Reduction of the order time by half

Railway Engineering

Process optimization
Lead time
Warehouse management

It is not always easy to optimally balance the purchase of spare parts and the financial burden on the warehouse. At Paul Advisory, we are able to cope with such a challenge. A rail vehicle repair facility was dealing with the problem of long lead times for spare parts, a disproportionate volume of work in progress and high inventory levels. Analyzing the situation in more detail, we defined the supporting production, categorized the parts to be purchased, and planned the parts purchasing process to minimize the time and cost of the process.

The problem the customer faced

  • Long lead times for spare parts (3-9 months)

How he solved it

  • Ordered parts in advance for stock

The consequences for him

  • Large amount of finance tied up in the warehouse
  • Extremely long repair times (75 days on average)
  • Overcrowding of production areas with work in progress

After analysing the situation, we implemented the following measures

  • We divided the material ordering process into three areas, each of which is managed in a different way
  • From the analysis of the previous period, we have defined a core production which accounts for 80% of orders
  • For the carrier production, we have set the ordering of materials in advance so that they arrive within 14 days of the order's arrival

The implemented changes have brought the following improvements:

  • Reduction of the average lead time from 75 to 30 days
  • Decrease in work in progress from 9.5M CZK to 2.5M CZK
  • Decrease from 120 pallet places for work in progress to 40 pallet places
  • Clearing and making production more accessible

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