To reduce the value of spare parts items held is the last of the 7 Actions for Inventory Reduction and is probably the most obvious, but perhaps because of that the most overlooked.
Most cost reduction actions are aimed at reducing the cost of an item for the obvious profit and loss impact. However, cost reductions also have an impact on working capital and the investment required for inventory.
The other six actions discussed in this series are aimed at reducing the quantity held in stock or the time for which it is held. Action #7 works on reducing the purchase cost and, therefore, the overall value held.
There is no reason why this approach would be different from a normal cost reduction exercise — it’s just that the initial starting point is different.
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