A demand–supply interference technique for modeling Spare parts inventory policy

Abstract

This paper proposes a methodology for the evaluation of probability of in-stock of a spare parts procurement policy in a manufacturing industry. The methodology is based on the demand -supply interference, similar to the stress -strength interference principle generally used in reliability engineering literature. The paper also proposes a methodology to develop a spare parts procurement policy in order to satisfy the specified target probability of in-stock. Numerical examples are also presented to illustrate the proposed methods.