Analysing improvement possibilities for use of dynamic base stock levels in spare parts inventory control, by Joke Bek (with Vanderlande Industries)
June 7, 2013
It is known that wear is a main driver for demand for spare parts. For items that wear out, an increasing demand rate is expected during the lifetime of the equipment. However, base stock levels for spare parts inventory point are usually kept at a constant level. This study analyzes the use of base stock levels that are adapted during the lifetime of a capital good. General insights are provided and a case study at Vanderlande Industries is conducted. It is found that the difference in demand during the lead time and the holding costs are the main drivers that determine whether it is attractive to adapt the base stock levels during the lifetime of a capital good.