Parts inventory management

The immediate availability of replacement parts for construction equipment greatly determines customer satisfaction and hence sales. To increase sales and profits, a large equipment manufacturer wanted to increase the availability of parts at their dealer-sites without increasing the total amount of costly inventory.

EpiX Analytics performed an involved statistical analysis of the dealers’ historic sales and inventory data to determine what factors mostly determine demand for parts. Those results were then used to build a comprehensive optimization model that was then used to optimize the dealers’ parts-availability, while balancing this with limiting the total inventory.

The parts inventory optimization system was delivered to the client along with documentation and training. Field data showed an increase in parts availability with essentially the same inventory levels as before.

The manufacturer continues to use the optimization system after 5 years and has also applied it to inventory problems in other areas of its international business.

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