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Essential Techniques to Manage Machine Parts Inventory

There are many ways to manage a machine parts inventory. For example, Sawtooth diagrams, bill of materials, optimal economic order quantity are few methods in inventory control that are familiar and proven. Without these techniques, companies will find it difficult to manage the inventory in huge volumes and cause a delay in shipments. This article discusses several techniques that are essential to manage the machine parts inventory, especially in this competitive market.

Sawtooth Diagrams

A proven method for maintaining spare parts inventory is to maintain a balanced inventory volume. A sawtooth chart can help examine how it can be reduced or replenished over time. The Y-axis of the chart shows the inventory level. The X-axis shows time. The lines that connect to form a “sawtooth” show the steady decrease in inventory over time. Each peak shows the maximum inventory level. The length between each peak shows the time it will take to deliver. To achieve outstanding forecast, the minimum and maximum inventories for each part must first be known.

Bill of Materials and Economic Order Quantity

It is a formula for making a finished product that is helpful for future use. By keeping BOM up to date to avoid inventory discrepancies and to plan for errors or maintenance. The economic order quantity helps to order and calculate how much inventory to order given a specific production, preferred lead time, and other variables. Therefore, this formula can determine the number of spare parts needed to order or reorder.


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Loh Choon Song Kelvin, DPSM
Kelvin Loh Choon Song has substantive years of experience in the logistics industry, and specifically in managing inventory control. He holds a WSQ Diploma in Warehouse Services and is a member of the Singapore Institute of Purchasing and Materials Management (SIPMM). Kelvin completed the Diploma in Procurement and Supply Management (DPSM) course on March 2021 at SIPMM Institute.
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