| |August 202194. Historical consumption: Consumption is commonly expressed in terms of quantity (fast moving, average consumption, and slow moving) and value (high turnover, medium turnover, and low turnover).5. Cost: Unit cost is a key factor in the determination of the degree of monitoring and control required for inventory of spare parts, so they are classified as high cost, medium cost, and low cost.Key Aspects of Effective Spare Parts Management1. Stocking Criteria: This consists of guidelines on when to stock and when not to stock a part.2. Stock Levels: This decides how much to stock: minimum and maximum stock levels and reorder quantities. 3. Stockouts: This includes impact analysis and root cause analysis of stockouts followed by implementation of corrective measures.4. Stagnant Stocks: This includes root cause analysis, implementation of corrective measures and approach for reduction of existing stagnant stocks.5. Stock Review: This encompasses verification of correctness of stock levels, identification of potential stockouts & stagnant stocks, corrective actions for improvement of inventory composition, turnover, and availability. Inventory of spare parts for new products and discontinued products needs to be planned based on non-traditional approaches, industry expertise and technical projectionsNiranjan Ajgaonkar
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