Which lot sizing method in Material Requirements Planning (MRP) matches order quantity directly to demand?

The lot-for-lot (LFL) method in Material Requirements Planning (MRP) is designed to align order quantities directly with the actual demand for items. This method is particularly effective because it allows for flexibility in the production and procurement process, ensuring that inventory levels are kept at a minimum while meeting customer requirements accurately.

By using the LFL approach, a company produces or orders exactly what is needed for each time period without excess inventory, which helps reduce holding costs and the risk of obsolescence. This is especially beneficial in dynamic environments where demand can change frequently, as it allows organizations to respond effectively to changes without being burdened by surplus inventory.

The other options do not precisely match order quantity to demand in the same manner. For instance, periodic-order quantity schedules orders based on a fixed time period, which may not correspond perfectly to fluctuating demand, while the fixed-order quantity method works with predetermined lot sizes that may not be ideal for varying demand levels. Minimum order quantity ensures that orders meet a minimum threshold but does not guarantee alignment with specific demand. Thus, lot-for-lot is the method that most accurately reflects direct matching with demand.