Inventory Life Cycle for Parts

▤ Summary

Today, the OEM replacement of parts is happening at an ever-increasing rate as technology allows for improvements in performance and longevity. New parts usually show up when a new demand is recorded by the transaction processing system. • If demand is low and we have many failed units in stock, wait to repair them until they will be needed. • Some failed parts will be too broken to fix, so we need to consider a yield rate with our repair orders. For example, if we have a 90% yield rate, then we will have to send 10 parts out for repair, on average, to get back 9 good ones.

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