Inventory management system development in automotive spare-part business

Abstract

To improve the inventory management system in spare-part business. The author studied how to improve inventory management in automotive spare-part business. Seven steps of inventory management system for this research are conducted to solve problems in ABC Company as poor storage space utilization, large number of stocks and high inventory costs. Warehouse management and inventory record system improvement are required for solving warehouse problems and more accuracy of stocks. Then, inventory policy is set to decide which part and when they should start to stocks. Trend of spare parts is another point to study trend of demand for demand forecasting. This research also presents how to select the suitable techniques for forecasting, and example of forecast demand in the next year. Optimal order quantity is also computed for appropriated replenishment order. Finally, dead stocks and sleeping stocks will be managed to improve storage space area and reduce inventory cost. From the proposed systems, the result for inventory management system involves total inventory costs reduction of the example spare parts around 64.7% from actual system with trends of spare part demands analysis and more storage space area is also benefit from the system.