An Inventory policy framework for the low turnover spare parts

AbstractThe management of low turnover spare parts may be deemed as a huge challenge nowadays. Characteristics such as high purchase costs, long supply answer time, low turnover, irregular consumption and high risk of obsolescence, render the management by traditional methods difficult or even impossible. This study features a new method, practical and effective, for managing low turnover replacement parts. It makes use of a class of Markovian processes called Piecewise Deterministic Process. This is a novel approach and incorporates stock and order costs in an infinite horizon. The findings in this work can be applied in industries such as oil, steel, automobile, air and maritime, which features high storage costs of replacement items that have a low consumption rate, but are instrumental to the productive process. In this sense, decisions must be taken quickly, and often the analysis related to the management of replacement parts plays only a secondary role.
journal: Journal of LaTeX Templates

Edilson F. Arruda, Lino G. Marujo, Paula D. Elias, V.J.M. Ferreira Filho, \cortext[mycorrespondingauthor]Corresponding author

keywords:
Spare parts, Piecewise Deterministic Process, Low turnover inventory management
journal: Journal of LaTeX Templates
journal: Journal of LaTeX Templates

Highlights

  • 1.

    A new methodology to manage the low turnover spare parts inventory problem was provided.

  • 2.

    A class of piecewise deterministic Markov process was developed

  • 3.

    Random jumps were modelled by an algorithm based on stochastic dynamic programming.