BSL/BRP

[CTB]

I'm looking to increase my days supply for my faster moving part numbers and I'm wondering how far to go to avoid supplementing our inventory via daily orders so much, without creating an excess stock situation. Any thoughts?
Thanks.
CTB

[Mike Nicholes]

Trying to manipulate the stocking levels using only the BRP/BSL usually is sub-par. Try separate sourcing the fast moving parts (determine what is fast moving; YRSL >20, for instance) put these in a separate source and then use the per job field to put in the minimum amount you want to have on the shelf. The system will then, daily, continually order up to that amount. Conversly you can take the slower moving parts, in a separate source and do the same thing, limiting the stocking level using the ful bin field; min of 2 will never have less than 2.

Try and avoid getting too wild with multiple sources. Some advocates will use up to a hundred or more; it is not necessary.

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[johnny o]

You said ...
I'm looking to increase my days supply for my faster moving part numbers ...

WHY ?
How much of an increase ?


how many days supply do you have one these items now ?

why do you feel that you require an increase ?

How many days before resupply ?


Usually Fast moving items are already sustainable with a very low days supply ... as the warehouse usually stocks these items readily.

Unless you are buying at a discount why would you wish more days supply of tune up items and high turn over parts ?

[chartle]

CTB,

First of all, I guess I am one of the advocates Mr. Nicholes is talking about with one hundred sources. While our process uses almost 100 sources, we have NEVER advocated this in a typical dealership unless you have the ability to control that many, and I have yet to see a dealership that can with today's tools on the DMS.

My two cents:
I agree with Mr. Nicholes that you should set up some Source By Movement, separating out the faster moving items from the slower moving stock. This can easily be accomplished by setting up some Source By Movement Sources that will automatically manipulate the part number population based on the YRSL setups (SCS for ADP... 2322 Source Override in ReyRey) for example. You can contact WD&S at (800) 321-5312 and request an article I wrote on how to set up SBM from earlier this year.

Back to the subject at hand. I do agree with Johnny that your days supply settings on faster moving items should actually be lower that the slower moving parts as increasing the days supply on faster moving items, once isolated into their own source, will generate ROP/BSL levels that will allow you to actually lower the day supply setting. Unless your days supply setting is just too low to begin with in the single source, increasing the days supply for faster moving parts will only give you unnecessary depth....

I am against using per job and/or full bin settings unless there are conditions that warrant it such as:

Per Job - Spark Plugs for V8 should be Per Job of 8; Brake Rotors should be Per Job of 2.

Full Bin - Should only be used if there is a facilitation issue and you need to keep it under the computer generated BSL calculation.

Using Per Job or Full Bin to control stocking levels might look enticing at first, but our experience shows that managers rarely go back and make adjustments as parts history changes over the months... and by the way, the DMS system can and will adjust accordingly and that is what you pay the big bucks for.

Johnny is asking some great questions that you should consider as you begin to Source By Movement your inventory....

Chuck Hartle'

[96lt1ss]

With Reynolds I found using 2323 to do the different sources and set the number of days supply to keep on hand. With faster moving items it is set to keep 30-45 days worth and slower items are 10-15 days.Realize these numbers will need to be carefully evaluated as it can drastically overload you, the suggested stock order will help review the quanities until they are where you like them.

When you do this it's important to properly set the order pad and update codes. You have to set the update code to 2 if you don't want the price updates to mess with the modified sourcing.

[This message has been edited by 96lt1ss (edited 08-19-2005).]

[Gary J. Naples]

CTB,

First of all, if you haven't already done so, prior to changing your ROP/BSL settings you should make some calculations based on your order cycle--frequency of order, ship time, receiving/stocking time, etc. to determine a planned starting point. Even if you are on a daily order initially calulate using a weekly frequency.

All too often adjustments are made to days supply without consideration to these factors. Once you have a calculated days supply you can then manipulate it per movement source to find the optimum settings (no over stock and not running out of parts.)

Secondly, I'd have to agree with Chuck and Johnny o, having isolated the fast moving parts in to a separate source you would want to decrease the days supply, particularly with a daily order. But remember, in any case, before any adjustments, the key is having a good days supply starting point based on your order cycle.

Lastly, logically separate your inventory into as many sources as you think you can handle. Don't be afraid to try it. As a Parts Manager I utilized anywhere from 20 to 25 sources per car line. Multiple sources really give you a lot of flexability. Combined with a source by movement you can significantly improve your inventory performance.


Gary