A meticulously planned and flawlessly executed MRO purchasing and management strategy is a thing of beauty. Not only does it keep costs low by eliminating off-contract buys and rush delivery charges, but it also streamlines MRO inventory management, lends insights into spare part usage, and enables predictive and scheduled maintenance that maximizes production time.
MRO inventory management solutions that illuminate all of a company’s spending on essential items, not directly included in the final product, should command more strategic consideration than businesses often devote. A proper purchasing strategy delivers meaningful benefits to manufacturing and retail organizations by implementing MRO inventory control that ensures that the right parts are available at the right time, while also minimizing costs and waste:
- Building strong relationships with dependable suppliers to secure better pricing, priority status, and more favorable delivery terms.
- Regularly scheduling MRO inventory management reviews and adjustments based on changing parts demands, production schedules, and market conditions.
- Shining a light into the MRO supply chain to track product lifecycles, forecast process changes, anticipate future needs, and prevent parts obsolescence.
- Right-sizing stocks through precise reorder points, usage tracking, centralized storage, and other MRO inventory control measures.
Unfortunately, few manufacturing and commercial businesses boast a fully optimized purchase/supply/MRO inventory management process. Most have suffered the pain of carrying too much stock or running out of critical spares at the most inopportune moment, but it is still an area that often gets put off or is undermanaged.
Too Little, Too Late
Having insufficient MRO inventory creates risk of prolonged downtime as you frantically search for and install a replacement valve, gauge, gasket, or other crucial part. As the clock ticks away your profits, you’ll also incur additional delivery fees, risk disappointing customers due to missed deadlines, and run up overtime and energy costs as you scramble to get back on schedule.
MRO inventory management solutions that include proper ordering scheduling and procedures enable robust historical data analysis, trend identification, and alignment of machine lubricants, replacement parts, and consumables usage with upcoming demand forecasts so specific parts and materials can be ordered for timely delivery and performance of preventative maintenance during scheduled down times.
Whosits and Whatsits Galore
Keeping too much stock comes with its own set of challenges that cost businesses not only money but other valuable resources such as usable space, management time, labor, and more:
- Slow-moving inventory or commonly known as SLOB, may sit on the shelf for years, crowding out other materials that play larger daily roles in your productivity or even precluding the expansion of production facilities that could contribute critical revenue.
- Cluttered warehouses and makeshift storage areas pose injury risks and make it difficult to get to and quickly find the parts, cleaners, pumps, and other parts needed to swiftly complete maintenance and repairs. Facilities lacking MRO inventory optimization and logical organization can expect to make panic purchases when improper storage makes components inaccessible.
- Technological advances, equipment replacement, and other eventualities can make parts in storage obsolete before they ever get into the game. This not only results in wasting the money used to buy these components but also the opportunity cost of using that cash for something more practical.
- Carrying costs rise in conjunction with the amount of inventory. The more your stock’s value increases, the higher your insurance premiums and the more labor required to manage and move it. Sensitive parts require dry, cool, and dust-free conditions, adding to energy costs.
Finding the Happy Medium
Striking the right balance requires specialized expertise and sophisticated MRO inventory management services to ensure timely, correct reordering and proper stock management. Min/max inventory levels no longer suffice as a one-size-fits-all solution.
SDI helps clients evolve into predictive, dynamic, and intuitive inventory management services enables inventory reduction of 20% or more while drastically reducing the risk of stockouts and maintaining higher service levels.
Zeus, SDI’s MRO inventory management system, consolidates all SKU information into a single data lake, simplifying information exchange and reducing the risk of errors. Its advanced data analytics, e-procurement and mobile apps, storeroom/warehouse technology, and inventory management modules, identifies opportunities for reducing excess inventory build-up. It identifies under-utilized parts, preventing obsolete inventory growth, and over-utilized parts, triggering root cause analysis for potential machine maintenance or employee training.
Ask SDI’s helpful team how our MRO ordering and vendor-managed inventory solution can consolidate your procurement operations and safeguard your business from supply chain disruption. Contact us for a demonstration.