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Customer stock in repairable item systems

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Abstract

Many enterprises that use expensive capital goods outsource the process of spare parts supply and stocking to a maintenance-, repair-, and overhaul provider (MRO-provider). Because of the high value, these spare parts are stocked in repairable item systems, in which defective parts are repaired after removal from the machine and put back into stock. When setting inventory levels, the providers do not consider all of the spare parts that are stocked in the system because customers hold own stock to bridge the delivery time from the MRO-provider. As these spare parts are not property of the MRO-provider, the provider does not take them into account when planning inventory, incurring overstocking at the central depot. A model, which considers customer stock when determining depot inventory levels, is developed by extending the METRIC model with a heuristics. The heuristics calculates backorder levels according to the depot inventory levels as well as customer stock levels and allows for an inventory reduction. Using the proposed model, savings of depot inventory can be up to 100 %, while keeping the backorder level of part requests below a preset threshold.

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Acknowledgments

The results presented in this paper were developed in the research project dLP– dynamic LRU planning (03CL02H). dLP was part of the Aviation Cluster of the Metropolitan Region Hamburg funded by the German Federal Ministry of Education and Research (BMBF).

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Correspondence to Daniel Schneider.

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Schneider, D., Tracht, K., Meyer-Stender, M. et al. Customer stock in repairable item systems. Prod. Eng. Res. Devel. 10, 209–216 (2016). https://doi.org/10.1007/s11740-015-0654-3

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