FinanceAugust 18, 2021

8 Best Practices for Managing Spare Parts Inventory

Best Practices for Managing Spare Parts

Managing and forecasting spare parts inventory to support industrial operations is both mission critical and yet exceptionally challenging for most companies. Inventory and supply chain teams deal with extreme complexity:

  • Massive part catalogs
  • Complex networks of facilities, storerooms, warehouses, and DCs
  • Multiple types of part consumptionPart substitution logic
  • Repair vs. Buy New decisions
  • Multiple vendors and suppliers

Common forecasting methods that work well for finished goods are often ineffective when applied to spare parts, as demand for spare parts and materials is often highly intermittent and erratic. This makes forecasting spare parts difficult. Our Software delivers a cloud inventory platform that automates forecasting while applying advanced analytics to derive trends, patterns, and probabilities from even the most intermittent of demand sets. Vanguard’s advanced-analytic tool set includes Croston’s intermittent demand model, as well as more advanced Monte Carlo simulations for probability modeling. All of this is packaged in a cloud network environment to help users improve margins, service levels, and MRO optimization, while reducing stockouts and net carrying costs to achieve the lowest possible total cost of ownership (TCO). With Predictive Planning™ for forecasting spare parts, organizations gain:

  • Maximum forecast accuracy
  • Improved intra-company and value-chain partner collaboration
  • Reduced stock-outsReduced safety stock
  • Improved service level, revenues, and customer satisfaction
  • Increased procurement efficiency

Download our solutions brochure to follow these eight best practices for managing spare parts inventory and you will be on your way to optimizing your inventory, forecasting spare parts, minimizing your operational and financial risk, and maximizing your return on assets.

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