Production Planning: A Practical Guide for Small Manufacturers

Egor Domnin · 2026-02-04 · Production Planning

Learn what production planning is, see batch production examples, and discover how to connect planning with inventory and scheduling.

Production Planning: A Practical Guide for Small Manufacturers

Production planning answers three basic questions: what to make, how much to make, and when to make it. Get these answers wrong, and you end up with unhappy customers, wasted materials, or cash tied up in inventory you don't need.

For small manufacturers—whether you're making cosmetics, food products, paints, or craft goods—production planning doesn't require complex software or a dedicated team. It requires thinking ahead, understanding your capacity, and connecting your plans to your inventory.

This guide covers how production planning works, the different approaches you can take, and how to build a simple production plan that actually helps you run your business.

What Is Production Planning?

Production planning is the process of deciding what products to manufacture, in what quantities, and over what time period. It's the bridge between customer demand and shop floor activity.

A production plan typically covers a specific period—a week, month, or quarter—and outlines which products to make, the quantities needed, and the materials required. For manufacturers who make products in batches, like food producers or cosmetics makers, the plan specifies which batches to run and when.

Manufacturing planning isn't just for large factories. Any business that transforms raw materials into finished goods benefits from thinking ahead about production. The alternative—reacting day by day—leads to rushed orders, stockouts, and inefficient use of materials and time.

Production Planning vs Production Scheduling

These terms are related but not the same.

Production planning is strategic. It determines what you'll produce over a period and ensures you have the resources to do it. Planning answers "what" and "how much."

Production scheduling is tactical. It assigns specific dates, times, and resources to each production task. A production schedule answers "when" and "who."

Think of planning as deciding you'll make 500 jars of face cream this month. Scheduling is deciding you'll make the first batch of 100 jars on Tuesday using mixer #2, with Sarah running the line.

In larger operations, the master production schedule (MPS) serves as the central document connecting demand forecasts to actual production. It breaks down the production plan into specific time periods and quantities. For small manufacturers, your production plan and schedule might be the same document—and that's fine.

Production Planning and Control

Production planning and control are two halves of the same process.

Planning sets the direction: what to produce, quantities, timing, materials needed.

Control monitors execution: is production on track? Are we using materials as expected? Do we need to adjust?

Without control, a plan is just a wish. Without planning, control has nothing to measure against.

For small manufacturers, production planning and control often happens informally—you check progress, notice when something's off, and adjust. The goal is to make this visible and consistent rather than relying on memory. Even a simple checklist or spreadsheet that tracks planned vs. actual production counts as production control.

Types of Production Planning

The right planning approach depends on how you manufacture. Here are the three main types:

Job Production

One-off or custom products made to specific customer requirements. Each job is unique—custom furniture, bespoke machinery, commissioned artwork.

Planning focus: Individual job requirements, material sourcing per order, skilled labor availability.

Batch Production

Groups of identical products made together before switching to another product. Common in food, cosmetics, pharmaceuticals, paints, and craft manufacturing.

Planning focus: Batch sizes, changeover time between products, material quantities per batch, equipment scheduling.

Flow (Continuous) Production

Products move continuously through the production line with minimal interruption. Used for high-volume standardized products—beverages, chemicals, paper.

Planning focus: Line balancing, continuous material supply, minimal downtime.

Most small-to-medium manufacturers use batch production. You make a batch of Product A, then switch to Product B. Your production planning centers on deciding which batches to run, in what order, and ensuring materials are ready for each.

The Production Planning Process: 5 Steps

Here's a practical approach to production planning that works for small manufacturers:

Step 1: Forecast Demand

Start with how much you need to produce. Look at existing orders, historical sales, seasonal patterns, and any upcoming promotions or events.

For make-to-order businesses, your orders are your forecast. For make-to-stock, you're predicting what will sell. Either way, you need a number to plan against.

Step 2: Check Materials and Inventory

Before committing to production, verify you have—or can get—the materials needed. This means checking your bill of materials (BOM) for each product and comparing against current inventory.

If you're planning to make 200 jars of moisturizer and each jar needs 50ml of base oil, you need 10 liters of base oil. Do you have it? If not, can your supplier deliver in time?

Step 3: Calculate Capacity

Can you actually produce what you're planning? Consider equipment availability and throughput, labor hours available, workspace constraints, and time needed for changeovers between products.

If your mixer handles 50 liters per batch and takes 2 hours per batch, you can run 4 batches in an 8-hour day—that's 200 liters maximum.

Step 4: Create the Production Schedule

Now assign specific dates and resources. Decide which products to make on which days, sequence batches to minimize changeover time, and assign equipment and people.

How to make a production schedule that works: start with your constraints (equipment, key personnel), schedule your largest or most urgent orders first, then fill in around them.

Step 5: Monitor and Adjust

No plan survives contact with reality unchanged. Track actual production against plan, note variances, and adjust. If a batch takes longer than expected or yields less than planned, update your schedule.

This is where production control happens. Regular check-ins—daily for busy operations, weekly for smaller ones—keep plans relevant.

Production Plan Example

Here's a production plan sample for a small cosmetics manufacturer planning one month of batch production:

Company: Natural Beauty Co. Period: March 2026 Products: Face Cream, Body Lotion, Hand Balm

Total production: 1,550 units Equipment: 1 mixer, 1 filling line Staff: 2 people

This example of production planning and control shows: - What to make and when - Quantities per batch and total - Materials needed per period - Capacity assumptions (equipment, staff)

The control side would track actual vs. planned: Did we make 200 jars in Week 1? Did we use 8kg of base as planned or more?

Production Planning and Inventory Control

Production planning and inventory control are deeply connected. You can't plan production without knowing what materials you have, and production directly affects your inventory levels.

Here's how they connect:

Before production: Check raw material inventory against BOM requirements. Reserve or order materials needed.

During production: Track material consumption. Note any variances from expected quantities.

After production: Subtract used materials from raw material inventory. Add finished goods to product inventory.

This is inventory production planning in action—your production decisions drive inventory movements, and inventory availability constrains what you can produce.

Problems happen when these aren't connected: - Planning production without checking inventory → discover mid-batch you're out of a key material - Not updating inventory after production → stock counts drift, reordering fails - No visibility into reserved materials → accidentally use materials allocated to another order

For batch manufacturers dealing with expiration dates, the connection is even more critical. Production planning should consider which material batches to use (FIFO—first in, first out) and track which raw material batches went into which finished products (traceability).

Benefits of Production Planning

Why invest time in production planning and control? The benefits compound:

Less waste. When you plan quantities based on actual demand, you don't overproduce. Materials don't expire waiting to be used. Products don't sit unsold.

Better cash flow. You buy materials when needed, not "just in case." Less money tied up in excess inventory. More predictable spending.

On-time delivery. When you know your capacity and schedule realistically, you commit to delivery dates you can actually meet. Fewer rush orders and disappointed customers.

Lower production costs. Efficient sequencing reduces changeover time. Buying materials in planned quantities may get better pricing. Less overtime from poor planning.

Traceability. When production is planned and tracked, you know what went into each batch. Essential for quality issues, recalls, or customer questions.

Production Planning Software and Tools

You don't need expensive software to plan production—but the right tools help as you grow.

Spreadsheets (Excel, Google Sheets)

Good for: Simple operations, few products, one person managing production.

Limitations: Manual material calculations, no real-time inventory link, version control issues with multiple users.

A basic spreadsheet can handle production planning if you're making a handful of products and manually update inventory. Many manufacturers start here.

Dedicated Production Planning Software

Good for: Multiple products, BOMs/recipes, inventory integration, team access.

Production planning software connects your recipes to your inventory. When you create a production order, it automatically calculates material requirements, checks stock, and updates inventory when production completes.

Production scheduling software adds calendar views, resource allocation, and capacity planning. Some tools combine both.

When to upgrade from spreadsheets: - You're spending 30+ minutes daily on manual inventory updates - Multiple people need to access and update production info - You need traceability for compliance or quality control - Errors from manual data entry are causing problems

Production planning tools range from simple and affordable to complex enterprise systems. For small manufacturers, look for software that handles BOMs/recipes, connects to inventory, and doesn't require months of implementation.

Frequently Asked Questions

What is production planning and scheduling?

Production planning determines what to produce and in what quantities over a period. Production scheduling assigns specific dates, times, and resources to execute the plan. Planning is strategic; scheduling is tactical.

How do I create a simple production plan?

Start with demand (orders or forecasts), check you have materials, confirm capacity, then write down what you'll produce each day or week. Track actual vs. planned. Adjust as needed.

What's the difference between production planning and control?

Planning decides what to do. Control monitors whether it's happening as planned and makes adjustments. They work together—control without planning has no target; planning without control has no feedback.

What is a master production schedule?

A master production schedule (MPS) is the central document showing what finished products to make, in what quantities, and when. It's typically more detailed than a high-level production plan and drives material requirements planning.

How to make a production schedule for manufacturing?

List your production orders or planned batches. Assign each to a specific date considering equipment availability and changeover time. Check material availability for each. Sequence to minimize changeovers where possible. Build in buffer time for unexpected issues.

Tags: Production Planning, Scheduling, Manufacturing