Inventory optimization of spare parts for machinery production lines

This study focuses on developing an inventory management model for a make-to-order machine manufacturing business, with the aim of minimizing costs and preventing stock shortages of critical spare parts such as air filters and motor belts. The research addresses the challenges of balancing cost efficiency with stock availability in a spare parts inventory system. By creating a spreadsheet-based inventory management model for a make-to-order machine manufacturing business, by optimizing the Reorder Point (s) and Order-Up-To-Level (S) inventory policy using Grid Search and Golden Section Search. A simulation-based approach is used to evaluate different (s, S) combinations under varying demand and lead time scenarios, providing a practical solution that can be applied to real-world operations within the family business. The outcome of this study offers valuable insights into cost-effective spare parts management, ensuring the smooth operation of the production process while reducing excess inventory costs.