ADMI Slashes Idle Capital for Municipal Fleet
A major city’s fleet-parts inventory operation was responsible for obtaining and stocking parts for machinery ranging from lawn mowers to fire trucks. Due to frequent personnel turnover there were few, if any, parts inventory processes in place, resulting in increased downtime for city fleet vehicles. Because there is no sales or profit motive with a municipal fleet, equipment up-time is the principal objective.
ADMI provided on-site analysis and training services to the fleet department managers, utilizing ADMI Personnel Training and Inventory Management systems. Two ADMI Consultants made week-long onsite visits to the department.
ADMI reviewed the DMS ordering rules to ensure that needed items were available based on past demand. The parts team was advised to allow SKUs that qualified for phase-in to be changed from non-stock promotable status to stock status.
Among the processes installed were the following:
- Daily Stock Orders
- Data Accuracy
- Monthly Parts Purchase Reviews
- Physical security for the inventory
- Returns for unsold items to the fleet’s facing dealership
Returns of unused items proved to be a particular success. Fleet management expressed a desire to maintain their current inventory levels, however they saw a tangible, immediate benefit in returning unused Special-Order Parts. In only one month after return-process implementation, the result was a return of $3,100. Idle capital aged 24 months and over was reduced to $0.00.