Determining the Optimal Spare Management Forecasting Technique for a Ship Maintenance and Repair Services Company

Strategic spare inventory management is an essential factor for a maintenance service company, specifically on ship care maintenance. An optimized spare inventory management does not only minimize the sleeping cash on the stagnant spares taking shelf spaces but also minimizes the delays on maintenance execution, thus, improving service performance quality. Company A has delivered and has been providing the maintenance and repair of four (4) fast patrol boats over the last five (5) years owned by Client 1. The current ending contract left unused spare parts which are quite problematic due to their volume and value if the contract will not be renewed. Optimistically, project extension for another five (5) years has motivated the researcher to determine the optimal spare management forecasting technique among many to be used by Company A. The company currently utilizes a Naïve forecasting technique for its spare management reported quarterly. This study, to determine the optimal forecasting technique, will utilize the last 48-month demand data (2020-2023). Spares of machinery and equipment are treated under ABC-XYZ Analysis to classify by which safe to keep units (SKU) falls under what category. Category AX is the focus of the study where the three (3) most valuable in terms of spare market price and well demanded spare part undergone four (4) different forecasting techniques. Among the techniques used were the Holt-Winter Approach, Moving Average Technique and Basic Exponential Smoothing Technique. Also, Naïve forecasting technique currently used by Company A is presented as the benchmark. The accuracy of this forecasting technique is compared by the forecasts’ Mean Square Error (MSE) and the total value of Spares 1, 2 and 3.