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Multi-Echelon Inventory Management Definition

June 26 spkhadmin

Multi-Echelon Inventory ManagementA multi-echelon inventory management system occurs when multiple storerooms are part of a spare parts inventory management and supply system.

For example, where a company on a large site has a central storeroom and then one or more satellite storerooms that are located closer to the operational activity.

Another example: When a company has a central storeroom that acts as a supplier to storerooms at multiple locations.

A Multi-echelon Inventory Management System Complicates things

This approach to inventory management complicates stock level decision-making. This is because the items held at all locations must be taken into account.

Multi-echelon systems provide a number of opportunities for reducing inventory holdings. However, they also present issues that need to be managed.
 
 
 


For information on our spare parts management online training please visit our Pro Level page.


 
 
 
Posted by: Phillip Slater
 

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