Myth: no one can predict the future of parts demand many people think: People are not God, how can predict the future? Product failures are so random that no one can predict which products will fail and when. To this end, they are always "living in the moment" , never thinking about the future, and consider themselves a kind of Down to Earth "pragmatic" . In fact, this is a lazy people do not want to think of an excuse, is a pessimistic idea, we should never underestimate the repeatability of parts business, in seemingly random data, parts demand in accordance with a certain regularity repeated, demand forecasting is big data mining, which is the basis of our inventory planning. For example, cars and construction machinery equipment need regular maintenance, each maintenance needs to replace the oil and filter element is fixed, use to a certain time interval needs to be replaced, this is the certainty of demand, and so on, and so on and so forth. Strictly speaking, all demand forecasts are wrong, but a forecast is better than no forecast. No forecast means many forecasts, and every forecast is a balance of opportunity and risk. When the demand frequency of a part is high, it satisfies the characteristic of normal distribution, most of the values are concentrated near the mean value, so that the distribution has a good single peak, the further the demand is from the mean value, the lower the probability of occurrence. In this way, we can make an inventory plan according to the three-box inventory management model (from the purchasing and selling inventory system to the three-box inventory management model) , and evaluate the inventory quantity of each part by calculating the demand of the order cycle and the delivery time, and use the normal distribution curve to set up a certain safety inventory, in the middle of the analysis of inventory parts opportunities and risks, to find the best balance point. For those parts with high frequency and large quantities of demand, the uncertainty of demand is relatively small, the inventory turnover of parts is higher and the value created by storing such parts is higher; on the contrary, the greater the uncertainty of demand, the lower the accuracy of prediction, the larger the additional safety stock, the lower the inventory turnover, so save less or not. In short, companies must keep up with the times, clinging to past successes does not guarantee future success, forecasting parts demand is not only necessary, but also possible, and that's the beauty of big data. Enterprises should store more low unit price, sales volume of fast turnover parts, such parts prediction accuracy is high, once the shortage will lead to great complaints from users; similarly, enterprises should save or do not store high unit price, sales volume of slow turnover parts, such parts demand is low, forecasting accuracy is poor, it is easy to form a stagnant inventory, there is a shortage of goods also easy to get customer understanding, after all, the accessories business must help enterprises to make profits, otherwise the enterprise can not continuously invest to improve customer service, to meet customer demand can only be empty words. MISTAKE: If spare parts are kept for more than a few years, they will be sold sooner or later in the warehouses of many enterprises. Many spare parts have been stored for many years, and they have never been used for bad debts or discounts. Enterprises think that spare parts are kept in warehouses, so long as they are not lost and rusty, there is no risk, there's nothing to lose. That's a very wrong perception. First, the machinery industry's inventory holding cost is 25% of the amount of inventory held each year. This includes the cost of capital (interest) , the cost of services, the cost of space, the cost of risk (impairment or obsolescence) , the management system and other costs of purchasing inventory, unsold parts are worth 25% less each year. This is the hidden cost of parts inventory, but many enterprises ignored. Second, the risk of inventory stagnation rises rapidly after parts have been in stock for more than 6 months. Statistics show that for parts that have not been out of stock for 12 months, the probability of achieving sales after 24 months is only about 5% ! The longer the storage time, the greater the risk of dullness. Slow moving parts that have been in stock for more than two years are at great risk of dullness. Therefore, enterprises should take discount promotion and restocking activities every year as a necessary stop-loss measure, otherwise parts are likely to always "sleep" in the warehouse, seemingly no loss, actually occupies the enterprise's funds, shelves and Manpower (inventory and handling) . Product upgrades and diesel emissions increase, so that the risk of parts inventory further increase, "put a few years, sooner or later parts can be sold" , is a self-deception lies. Myth: good companies want to meet all the needs of their customers many bosses like to flaunt their service philosophy, to 100% to meet customer needs. To this end, they want to do the service to the extreme, shouting "even if the dull parts to meet customer needs. ". Machine sales have been very difficult to make profits, many enterprises and shouted the slogan of "Free Service" , if accessories do not make money, enterprises on what to survive? How do you get the most out of your service? In fact, smart inventory management is not about perfection, it's about balance, the balance between the spot rate of parts and the turnover rate of inventory, the balance between Customer satisfaction and return on investment, the balance between fast-moving parts and slow-moving parts, where a lot of dead stock is created by the pursuit of "perfection, " where all shortages end in excess; and all surpluses, which start with shortages, end up backfiring, more and more inventory, parts out of stock situation is getting more and more serious, enterprise loss is very big, customer complaint is bigger, completely lose-lose situation. Free is not the label of a good company. Sustainable is. In the event of a business failure, not only the employees of the business but also the customers who buy the products of the business will suffer the most. The business goal of a great company is to grow and become better and stronger with its users. If the company can't make a profit, it's all a fantasy.
