Requirements for spare parts management

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This post was last edited by Black gold on 2010-8-10 16:08. Spare Parts Management ● Concepts of Equipment, Spare Parts, and Materials A. Equipment: Machines, containers, and other mechanical devices that are manufactured through processing, composed of various materials and components designed to perform functions such as production, power generation, transportation, storage, delivery, and research. (With independent functions) Equipment is a major component of a company’s fixed assets, and its value is gradually transferred to the products through depreciation. Assets resulting from zero-based setup and technical renovation projects are classified as equipment. B. Spare parts: *Components, parts, or elements of finished equipment, which can be divided into production spare parts and maintenance spare parts. Production spare parts refer to those components that come into direct contact with production materials and directly affect their shape or performance ； Maintenance spare parts refer to the components that constitute the main part of a device and are necessary for it to function. The service life of the former is related to production volume, whereas that of the latter is mainly determined by factors such as use and maintenance. The value of spare parts is allocated to production costs and expenses in one go; for those with a higher value, it can also be amortized over time to balance the monthly production costs, provided that the amortization is completed within the same fiscal year. C. Materials: refer to the raw materials required to complete construction and installation work, as well as spare parts, accessories, finished products, semi-finished products, etc., other than the equipment itself that has undergone industrial processing. Such as steel, wires and cables, ordinary valves, pipe fittings, non-disposable filling oils, packing materials, etc. Its consumption method is the same as that of spare parts, with it also being allocated to production costs and expenses in a one-time basis. ● The main aspects of spare parts management include: technical management, planning management, warehouse management, and economic management. A. Technical management: collection, drafting, and organization of spare parts drawings; preparation of spare parts catalogs; compilation of spare parts lists; forecasting of spare parts consumption; and determination of appropriate spare parts inventory levels and storage methods. Forms of inventory: finished product inventory, semi-finished product inventory, raw material or component inventory, paired (set) inventory, and spare part inventory. Several types of quotas: consumption quota (basis), physical inventory quota (result), and capital reserve quota (requirement). Principles for determining the consumption quota: 1. Based on the design life of the parts ； 2. Determined based on the actual consumption statistics of the parts. Principles for determining the quota for physical reserves: 1. Based on the consumption quota ； 2、Spare parts delivery time ； 3. Make adjustments using the optimal ordering quantity (higher quantities result in lower unit prices). Achieve the lowest total cost of spare parts (= manufacturing cost + holding cost) without affecting production. B. Plan management: This includes plans for purchased spare parts, spare parts supplied internally, raw materials, and the repair of spare parts. These plans are prepared on a monthly, quarterly, and annual basis, and the quality of these plans directly affects the efficiency of capital utilization. Long-cycle spare parts are generally also long-life spare parts, and are submitted through annual plans ； The production of spare parts is generally directly related to output; their consumption follows a good linear relationship with production levels. The same holds true for parts that are prone to wear and breakdown. It is easy to keep track of such items, and reports can be submitted on a quarterly basis to enable bulk purchasing ； The monthly plan is the foundation, focusing on maintenance parts with additional items for occasional urgent needs. When managing plans, the ABC management method can also be applied: focus on the key aspects while taking care of the less important ones. When classifying spare parts into categories A, B, and C, the following factors are given priority: 1. The importance in ensuring maintenance and production ； 2. Difficulty of processing and length of delivery time ； 3. The amount of capital occupied. Category A: High importance, difficult to process, long lead times, critical spare parts; spare parts with low inventory levels but high capital requirements. Generally, such spare parts account for over 60% of the inventory funds, while the various items in stock make up around 10%. Category B: Accounts for about 25% of the inventory capital, with inventory items making up around 30%. Category C: Accounts for 10% to 20% of the inventory capital and about 60% of the inventory items. C. Computer-aided management of spare parts: Several requirements: 1. Sound systems and well-organized processes ； 2. Sufficient hardware facilities, warehouse conditions, staff competence, and computer application skills ； 3. The coding of spare parts: The coding is of utmost importance as it has a significant impact on the system. An extra digit can increase the number of search results by 10 times, while a missing digit may lead to incomplete information; in some cases, different spare parts might end up having the same code ； 4. There is a software system that is in line with existing processes and is stable and reliable. D. Key technical and economic indicators for spare parts management: Spare parts consumption indicators: Spare parts consumption per thousand yuan of output value or per unit of product. Spare parts inventory indicators: Average inventory for the period, spare parts reserve per 100 yuan of fixed assets, and capital utilization rate (inventory cost/original value of equipment * 100%). Spare parts funding indicators: Inventory turnover rate (annual consumption/annual inventory * 100%), and days of spare parts funding turnover: (initial inventory + final inventory)/spare parts consumption during the period * 360 (days)