Storeroom and Spare Parts Management

Unlocking the Hidden Cash Flow in Your Organization

Imagine not have the right spare parts to make a repair, or maybe you don’t have to imagine it.  It has already happened.   Now imagine having to go through the storeroom and throw out $300,000 worth of parts because they were obsolete.  Once again, you may not have to imagine it.

These two scenarios play out every day in storerooms across the world.  It is an unfortunate situation as the organization is not getting the value from the upfront capital of the spare parts or the on-going expense of operating the storeroom.  This translated into reducing profitability for any organization.

Storeroom and spare parts management play a vital role in any maintenance / reliability program, but often times are not paid the attention that they deserve.  This lack of attention jeopardizes not only them maintenance / reliability program, but also the long-term viability of the organization.

Issues in the Storeroom

There are numerous issues in all storerooms, that organizations need to overcome every day;

• Parts aren’t where they are supposed to
• The right parts are never in stock
• There are parts in the storeroom that haven’t been used in 20 years

Many of the issues stem from one cause, poor data.   Everything in the storeroom operates on data, whether it is determining the stocking strategy, re-order quantities, or what equipment the parts belong to.

Without proper data, many of the decisions made, are made on intuition.  This is what causes over/under stocking and a high level of obsolesces.

Why Organizations Struggle With Storeroom & Spare Parts Management

Storerooms and spare parts management always seem to be an issue in most organizations.  This may be the case when the storeroom is owned by someone else other than maintenance, such as logistics or procurement, which does not have the same outlook as the maintenance team would have.

On the flip side, the storeroom may be owned by maintenance, and the knowledge of logistics and procurement may not be as strong as what is required.

What is required to have a successful storeroom is a partnership between all parties.  Maintenance, procurement, and logistics, all working together to ensure the maximum value is delivered to the organization.

The Impact of Your Operation

Properly operating your storeroom and managing your spare parts will ensure that you are able to avoid the common issues found in many storerooms.   In many storerooms, you will find;

• 30% of stock will not be used
• 8% of stock is duplicates
• 25% of your maintenance staff’s time is spent looking for spares

Overcoming these issues is not an easy task.   It takes time and focus on driving improvements in the storeroom.  Over the course of the next 5 weeks, I will be focusing the blog on storeroom & spare parts management.  The posts will be covering;

1. The Storeroom Layout
2. The Spare Parts Data
3. The Stocking Strategy
4. The Inner Workings of a Storeroom
5. Storeroom Optimization
6. Assessing Your Storeroom

If you have any requests or specific issues you would like addressed in this series, please let me know at info@eruditio.com

Remember, to find success, you must first solve the problem, then achieve the implementation of the solution, and finally sustain winning results.

I’m James Kovacevic
Eruditio, LLC
Where Education Meets Application
Follow @EruditioLLC