Why spare parts management matters more than ever in manufacturing

Best practices for managing spare parts more effectively

Managing spare parts effectively is not just about keeping inventory on hand. It is about making sure the right parts are available, easy to identify, and aligned with actual maintenance needs. For manufacturers, that means taking a more structured approach to how parts are prioritized, stocked, and reviewed over time. 

Prioritize parts based on criticality and consumption 

Not every spare part has the same impact on operations. Some components are essential to uptime and safety, while others are easier to replace or less urgent to keep in stock. One of the first steps in improving spare parts management is to separate critical parts from non-critical ones. 

A practical way to do this is by combining ABC and XYZ analysis. ABC analysis categorizes parts based on their consumption value, with A parts representing the highest-value items, B parts medium-value items, and C parts lower-value items. XYZ analysis looks at demand variability, with X parts showing stable demand, Y parts moderate variability, and Z parts unpredictable demand. 

Together, these two methods help manufacturers make better stocking decisions. For example, a part classified as AX may justify closer monitoring and tighter replenishment control because it is both high value and consistently used. A CZ part, on the other hand, may be a better candidate for ordering only when needed. This kind of categorization helps reduce both stockouts and unnecessary inventory.

Use data to set smarter inventory levels

Inventory levels should be based on more than habit or rough estimates. Maintenance history, failure frequency, lead times, and asset criticality should all influence how much stock is kept on hand. The goal is not to maximize inventory, but to align inventory with operational risk. 

One useful metric is the Spare Parts Investment Ratio, or SPIR, which compares the total value of spare parts inventory to the reproduction value of plant assets. This helps manufacturers assess whether their inventory investment is in line with industry practices and the needs of their operation. 

Deloitte identifies a SPIR of around 1.5% as a best-practice benchmark in Food and CPG. While the right target can vary depending on factors such as equipment age, production strategy, and supply chain conditions, SPIR remains a useful reference point for evaluating whether inventory levels are too high, too low, or appropriately balanced. 

Other spare parts KPIs to consider 

While SPIR is a useful benchmark, it is not the only indicator manufacturers can use to assess spare parts performance. Other KPIs can help teams better understand availability, responsiveness, and inventory reliability. 

• Stockout Rate: Measures how often a needed part is not available at the time of repair or maintenance. 
• Fill Rate: Shows how many part requests can be fulfilled immediately from stock. 
• Emergency Order Rate: Indicates how often parts must be sourced urgently due to poor planning or low availability. 
• Inventory Accuracy: Confirms whether system inventory matches what is actually available on the shelf. 
• Mean Time to Part Identification: Measures how quickly team members can find the right part during a breakdown. 

Standardize part information 

Spare parts are much harder to manage when descriptions, references, and specifications are inconsistent. Standardizing part numbers, equipment references, and naming conventions makes it easier to identify the correct part quickly and reduces the risk of duplicate stock, ordering errors, and delays. 

Better part data also improves coordination between maintenance, procurement, and operations. When everyone works from the same information, decisions become faster and more reliable.

Improve visibility across teams 

Spare parts management works best when team members can easily see what is in stock, what has been used, and what is linked to specific equipment. This visibility becomes especially important in the event of a breakdown, when maintenance teams need to identify the right part quickly in order to avoid longer delays. 

Without clear access to parts information, even a well-stocked inventory can be difficult to use efficiently. Better visibility helps team members find the part they need faster, supports procurement decisions, and reduces the risk of downtime caused by missing or incomplete information. 

As Alexis Popko, Premier Tech’s Parts Manager, puts it: 

“Spare parts management is not only about having parts on the shelf. It is about knowing which parts matter most, making them easy to identify, and helping maintenance teams act quickly when it counts.” 

Review and adjust regularly 

A spare parts strategy should evolve with the operation. Equipment ages, suppliers change, usage patterns shift, and maintenance priorities develop over time. Reviewing inventory regularly helps manufacturers keep stock levels aligned with actual needs rather than outdated assumptions. 

A more structured approach to spare parts management helps manufacturers reduce risk, improve responsiveness, and support more reliable operations. It also creates a stronger foundation for preventive maintenance, where parts demand becomes easier to anticipate and plan.