Improvement of Spare Part Inventory System for Process Machine

Abstract

Abstract

This research is aimed to study the improvement of a spare part inventory management system which is tested by the case study manufacturing plant. It was found that the plant has encountered high costs of spare part inventory storage due to massive storage of the inventories. In this research, the author has applied “Multi-criteria Inventory Analysis” method to divide the spare parts into groups by considering their priority of equipment and spare part liaised with movement of the spare parts, also separated the unused spared part from the groups. Then perform the cost risk ratio analysis and effectiveness of spare part storage. Lastly, inventory policies are presented for each group, divided by their moving priority. The result illustrated that this spare part inventory management study is able to reduce 19.8 percent of the annual cost of inventory spare part storage, increase inventory turnover from 63% to 81%. Otherwise, it can reduce machine downtime from part fail average to 0.85%