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Dependent demand refers to the demand for items that is directly derived from or dependent upon the demand for another item, usually a finished product. In other words, the requirement for component parts, subassemblies, and raw materials is determined by the production schedule of the final product. Unlike independent demand items, whose demand is influenced by market conditions and customer preferences, dependent demand items are calculated based on the structure of the product and the quantity of finished goods to be produced. For example, if a company manufactures 1,000 bicycles, and each bicycle requires two wheels, one frame, one handlebar, and one seat, the demand for wheels, frames, handlebars, and seats is dependent on the demand for bicycles. Thus, dependent demand is not forecasted independently but computed from the master production schedule and product design data. In material management, dependent demand plays a critical role in planning and controlling inventories. Since the demand for components is directly linked to the production plan, accurate coordination between production scheduling and materials planning is essential. This is where Material Requirements Planning (MRP) systems become highly relevant. MRP is a systematic approach designed ___ ___ __________ ___ __________ ___.
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