FM service providers waste millions on poor management of spare parts

Jun 24, 2019 • Features • bybox • Parts Pricing and Logistics

ByBox, providers of smart locker technology and field service solutions, reveals that the management of spare parts in the facilities management (FM) sector is inefficient and costing the industry millions.

That’s the message from research conducted last month with the UK’s top FM service providers and consultants. Its findings can be found in a new white paper from ByBox ‘Is the management of spare parts the last hidden cost in the FM supply chain?’

There is no standardised way of getting spare parts to engineers and most FM firms use a variety of different distribution methods depending on the site, the spare, the location and the client. As a result, engineers spend more time looking for spare parts rather than fixing plant. More stock is usually ordered than needed and is often more costly due to purchasing models. The knock-on effect further reduces tight margins and customers’ SLAs are missed incurring penalties. But, many procurement departments within FM service providers often consider the problem too tough to tackle.

“We were surprised at how decentralised the FM industry is,” remarked Stuart Miller, co-founder and CEO, ByBox.“The commonality we found across the sector was the disruption caused by engineers purchasing their own stock. This behaviour - albeit born out of necessity – not only effects engineer efficiency but the entire supply chain, budgets and relationships with other departments such as procurement and finance. Better use of data and distribution methods, will improve SKU optimisation and engineer efficiency as well as streamline internal processes and reduce overheads.”

At a time when margins are under extreme pressure, how do FM service providers balance the need to reduce the cost of managing spare parts while improving performance and boosting productivity?

In its white paper, ByBox shares insights about the approach FM providers are taking to spare part management. The paper delves into some of the challenges involved and offers solutions to removing these hidden costs. These include:

Centralising procurement and distribution methods of M&E spares;
Greater reliability and proactivity from the supply chain to be able to source parts from one location before the day starts;
More standardisation of assets and parts within buildings including architects, specifiers andconstruction firms; stopping the installation of systems manufactured / maintained by one-man bands where any spares come from a single source supplier;

The ability to store more critical spares in a fixed location close to or on site;
Better use of CAFM systems to manage inventory at site level, improving the use of data to better forecast break fixes / predictive-based maintenance.

The white paper can be found by clicking here: