Management Of Component Inventory In Gas Equipment Industry

With the more intense competition, more shortened life cycle andincreased expectation from customers, the companies can’t survive onlydepending on improving their own competitiveness. To be more competitivein the market, the companies must integrate the whole supply chain whichincluding customers and suppliers. The target is to improve competition of thewhole supply chain.The inventory management is one key issue during the whole supplierchain. It is related to all related departments. Excess inventory takes up alarge amount of money and it brings financial pressures. On the other hand,lower inventory will cause stock-out and low service level. Customers turn tothe competitors. Therefore, the reasonable inventory management becomesurgent and important.This study takes GCE Gas Control Equipment Co, Ltd as a case study, andanalyzes the current operation of the inventory control in GCE in threeaspects, namely inventory turnover rate, inventory cost per unit and ratio ofinventory to total assets. In order to improve the inventory management inGCE, three different solutions are proposed in this study.(1) Double-dimension classification is used for classifying the rawmaterials in GCE;(2) A performance management assessment system is introduced, basedon the analysis of the awareness of inventory control of the staff; (3) A joint inventory management model is developed to optimize theinventory control with the company.This study uses GCE as a case and combines industrial practices withmodern inventory management theory in supply chain. It is demonstrated thatthe solutions proposed have improved the efficiency of the inventorymanagement, and the overall supply chain competitiveness. Therefore, thisstudy can be used as a valuable reference for similar enterprises.