Materials Management
Never too little and never too much.
Spare parts are items that should only be held in stock in the exact quantity you require. Not too much because spare parts are subject to ageing and wear. This reduces their usability. Leading to a waste of money. Too little is also undesirable. This leads to longer downtime than strictly necessary and substantial loss of production.
The decision to hold spare parts in stock or not is based on a criticality analysis (risk analysis). The organisation's target business drivers on the one hand and the plant failure patterns on the other hand are used to identify high-risk areas in the plant. Next, one can decide to hold a stock of the components that are associated with the high-risk areas of the plant. Or negotiate good agreements with suppliers to limit the delivery lead time.
Materials Management: determine objectively what needs to be held in stock and manage the stock holding to both minimise unplanned downtime and inventory costs.
