Setting optimal inventory policy for mold spare components in a medical device production facility

Abstract

Inadequate inventory management policies utilized by the maintenance facility of a manufacturing plant result in the lack of spare components needed to carry out essential repairs on molds used in injection molding operations, thereby reducing the plant's effective production capacity. Thus, molds need to be run for longer periods to produce the same quantities of finished products, exposing them to a higher rate of wear and tear, ultimately incurring higher maintenance costs, utility costs and repair costs. This research creates a framework for properly categorizing the spare components based on their characteristics and applying relevant inventory models to each category to derive the inventory control parameters of reorder quantity, safety stock level and reorder point. Spare component inventory will be categorized by usage rates and their criticality to mold repairs while critical inventory parameters of safety stock, reorder point and reorder quantity are set to ensure a 97.5% service level while reducing total inventory costs by 9.1% or by $38.7K per year.