SAP MRP Lot Sizing Cost Comparison Calculator
SAP offers several lot sizing procedures in the MRP 1 view: EX for lot-for-lot, FX for a fixed lot size, HB for replenish to maximum stock level, and the periodic procedures such as weekly or monthly lots. This calculator puts a euro or dollar figure on the choice for one material.
Your numbers
Total consumption per year for the material.
Buyer time, receiving, invoice matching and freight handling per order.
Standard or moving average price.
Capital, storage, insurance and obsolescence as a share of unit cost.
Lot size used with procedure FX (fixed lot size).
Used for lot-for-lot (EX): one order per bucket with demand.
Your results
Classic EOQ model with constant demand and instant replenishment. Real MRP runs use period demand, so treat the result as a starting point for the lot size procedure and rounding values.
Annual cost vs fixed lot size
Sweeps Fixed lot size in material master from 250 to 10000, holding your other inputs fixed.
Lot size review across your SAP materials
Optional: we can run this comparison on your exported MARC and consumption data and send back the materials with the biggest savings.
Optional. The tool and every export work without this. No spam.
How to use the calculator
Enter yearly demand, the real cost of raising one order, the unit cost and your carrying cost rate. Then enter the fixed lot size currently maintained in the material master (field Fixed lot size in MRP 1) and the number of planning buckets per year. The tool returns the EOQ, the annual cost at the EOQ, the annual cost at your fixed lot and an approximate cost for lot-for-lot. The chart sweeps the fixed lot size so you can see how flat or steep the penalty is around the optimum.
- Use a loaded order cost, not just the buyer's salary
- Carrying cost of 15 to 30 percent is typical for manufacturers
- Compare against the lot size currently in MARC
- Round the EOQ to a sensible pack size or rounding value
The formulas behind it
Holding cost per unit is unit cost times the carrying rate. EOQ is the square root of two times demand times order cost divided by holding cost. Annual cost for any lot Q is (demand / Q) times order cost plus (Q / 2) times holding cost. Lot-for-lot orders every bucket that has demand, so ordering cost is buckets times order cost, and average stock is about half of one bucket of demand. The EOQ curve is very flat near its minimum, so a lot 20 percent away from the optimum usually costs only a few percent more.
Reading the result in SAP terms
If lot-for-lot is far more expensive, the material is probably cheap and ordered often: consider FX, a periodic lot size or a longer interval in the planning calendar. If the fixed lot is much worse than the EOQ, update the fixed lot size and maintain a rounding value or minimum lot size so MRP proposals match supplier pack sizes. For expensive, low volume parts lot-for-lot is usually right because holding cost dominates. Check the result against supplier price breaks, which this model ignores.
Common mistakes
The most common error is using an order cost that is too low, which pushes lot sizes down and creates many small purchase orders. The second is ignoring minimum order quantities from the info record, which can force a larger lot than the EOQ. Also remember that MRP lot sizing acts on net requirements, not on a smooth annual rate, so lumpy demand can make a fixed lot leave excess stock after each receipt.
- Do not ignore supplier minimum order quantities
- Review lot sizes after price or demand changes
- Check scrap and rounding in the same pass
Frequently Asked Questions
Which SAP lot sizing procedure is best?
There is no single best option. Lot-for-lot (EX) suits expensive or erratic items, fixed lot size (FX) suits stable parts bought in pack sizes, and replenish to maximum (HB) suits consumables with reorder point planning. Use the cost comparison to support the choice per material group.
Where do I maintain the lot size in SAP?
In the material master, MRP 1 view (transaction MM02), field Lot size for the procedure, and Fixed lot size, Minimum lot size, Maximum lot size and Rounding value in the same view. These are stored at plant level in table MARC.
Is EOQ still relevant with MRP?
Yes as a guide. MRP calculates on net requirements by period, so EOQ will not match exactly, but it sets a sensible fixed lot or periodic interval and shows how costly extreme choices are.
What carrying cost rate should I use?
Add cost of capital, storage, handling, insurance and expected obsolescence, expressed as a percent of unit value per year. Many plants land between 15 and 30 percent. Use your finance team's number if they publish one.
If you want lot sizes reviewed across thousands of materials, Netray can run this analysis against your live SAP stock and consumption data, read-only.
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