Design. Analyze. Optimize.

Mass optimization - Optimize your whole storage

When companies are expanding their processes also the need for more spare parts arises. As a result of this the amount of stock items in the CMS grows easily very large, and so does the storaging costs. Cutting down these costs without affecting production has proven to be a challenging task to most.

StockOptim software allows the effective optimization of a large stock item groups that provides information about the possible hidden problems among the items including larger than needed item amounts in the storage and risks coming from shortage situations.

Item optimization projects collect the history data of stock item usage from the storage CMS. In order to create approximate calculations based on the history data it should include a sufficient number of storage visits per each stock item. The possible flaws in the data are compensated by performing an overview for the optimization results. The overview is focused on the items that show in the optimization results that the current storage strategy (item reorder point and order size) does not fill the required service rate requirement (probability that the storage client gets all the needed spare parts from the storage).

Project goals:

  • Locating stock items that contain risks in their current storage strategies and to correct these strategies in a cost-optimal way
  • Locating stock items that has the potential to decrease their overall storing costs (lower stock levels, larger order sizes)

Project phases:

  1. Transferring stock item history data from storage database to Excel documents
  2. Optimizing stock item storage strategies in StockOptim software
  3. Reviewing the optimization results together with the storage personnel and concentrating on the possibly located problematic storage strategies
  4. Changing the problematic stock item storage strategies to the storage system

The reviewing process takes into account that the required service rate can be lowered with some items, or the service rate value calculated by StockOptim from the item usage data is too low compared to the reality, if:

  • Item is non-critical and it is considered acceptable that the storage cannot serve all the storage clients perfectly (if item ABC classification is used, it might be considered to lower the current classification)
  • Item is usually taken from the storage by a storage client as a larger amount as is needed, and some of the items are stored to some unofficial local storage that cannot be seen in the system (true service rate is higher that the calculated one)
  • Item is ordered from the suppliers in different and varying order sizes than what the official storage strategy requires as the 'order size' input (true service rate is higher than the calculated one)