Improving On-Time Delivery in a Metalworking SME Using Demand-Driven MRP and Simulation-Based Validation

Peruvian metalworking SMEs struggle to meet the 87.5 % on‑time delivery (OTD) benchmark, largely because existing material requirements planning systems fail under intermittent demand. This study closed that gap by integrating Demand‑Driven Material Requirements Planning (DDMRP) with Croston‑based forecasting and validating the approach through discrete‑event simulation. After mapping the current value stream, strategic inventory buffers were dimensioned from a 31‑month demand series for chassis tanks and embedded in an Arena model of the line. Compared with the baseline, the proposed system raised simulated OTD from 41.6 % to 94.0 % and cut average production lead time from 55.4 to 18.3 days, delivering an estimated annual net profit of US $73,894 against an investment of US $4,533. The work provides the first quantitative evidence of DDMRP’s effectiveness in the Peruvian metal‑mechanic sector, demonstrates its transferability to settings with high demand variability, and contributes a replicable procedure for practitioners seeking sustainable, low‑capital performance gains.