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Maintenance Repairs and Operations Inventory Inventory is normally considered either for assembly or stocked for resale to other companies or organizations. However, there is also inventory that the business (manufacturing, retail, warehouse, etc.) will use. This is for maintenance repairs and operation.
Inventory control software will enable a business to develop a spreadsheet listing each maintenance repair and operation product, the machine(s) or operation(s) it supports, and the quantity of the product normally needed for a repair or maintenance activity.
Unlike inventory for resale, maintenance repairs and operations are an expense of doing business and are not an investment. Many organizations have too much inventory in their maintenance and repairs inventory. There should be a valid need or justification for stocking every one of the products carried in the maintenance and repairs inventory. Valid justifications would include:
1. The product cannot be obtained in the time period necessary to fill a need once the need has been determined.
2. The product must be purchased in a quantity greater than what is needed to fill a particular need.
3. The cost of carrying a product in inventory is less than the procurement cost.
Maintenance repair and operations inventory can be separated into three categories:
1. Continual use items are maintenance items as are other products that are repeatedly used.
2. Specific need inventory is not continually used, but these items are used on a regularly scheduled basis.
3. Emergency repair parts whose sporadic usage cannot be predicted. Often companies will have spare parts in stock for machinery that is no longer in service. When a piece of equipment is retired all the spares for the machine should be removed from the parts room. When a process is discontinued the replacement parts can be easily identified and removed from the maintenance repairs and operation inventory by referring to the spreadsheet listing. |