MDO SPARES ROI CALCULATOR

Maintenance, Repairs, & Operations typically accounts for 5-10% of a company's Cost of Goods Sold (COGS).

By focusing on accurate, complete, and standardized Spare Parts data, you can drive significant one-time and ongoing hard-dollar savings for your company.

Let’s find out exactly how much below, in just a few clicks.

Please only enter numbers (no letters or other characters) in each field provided below.

  • Reduce Procurement Costs
  • Reduce Inventory Costs
  • Increase Procurement and Maintenance Productivity
  • Report

Step 1 - 4

Reduce Procurement Costs

When Maintenance workers can’t easily find the critical spare part they need, they will often bypass the existing Procurement process by using Free-Text Spending. This process is exception-based, and almost always results in higher prices on the parts, expedited shipping costs, and many other significant negative impacts to an organization’s bottom line.

By cleansing, de-duplicating, enriching and standardizing your Spare Parts data, you can achieve major savings by dramatically reducing rogue Free Text spending.

Typical savings here is between 5% to 20%.

Free-Text Spend (Annually)

Total spend over 12 months for materials purchased via free-text.

Cost Reduction

Percentage savings by using negotiated prices, standard processes, and catalogued materials instead of free-text.

$
0 1%
50%
i Typical value ranges from 1-50%

Reduction In Procurement Costs

Estimated Saving

$

Step 2 - 4

Reduce Inventory Costs

Working capital costs will drop by reducing/eliminating duplicate materials (unidentified duplicates, etc). Procurement, warehousing, and readiness management costs will drop as well.

Total Stock value of Spare Parts

This figure should include all stock value to indirect materials (spare parts and operating supplies).

Estimate of Duplicates in Existing Stock

A taxonomy is a structured index of naming conventions for Spare Parts, important for doing spend analysis for better-negotiated volume pricing, as well as eliminating duplicates, and more easily finding needed spares. Companies with no taxonomy have typically have between 20-40% duplicates.

Target Level of Duplicates

It's very difficult to completely eliminate duplicates, so what percentage would you hope to achieve (5-10% is a good result/estimate).

Working Capital reduction

Let’s say you have 25% duplicates, and could reduce this number to < 5%. Of the 20% reduction, what %, could be removed from working capital (immediately or overtime) by use/consumption?

$
0 1%
50%
i Typical value ranges from 1-50%
0 1%
20%
i Typical value ranges from 1-20%
0 5%
100%
i Typical value ranges from 5-100%

Reduction in Inventory Costs

Estimated Saving

$

Step 3 - 4

Increase Procurement and Maintenance Productivity

MDO supports business rules and pre-built algorithms to standardize data set default values, for both single records and mass changes. Let’s look at improved efficiency/productivity due to this automation.

No of spare parts materials

Number of spare parts and operating supply materials in your ERP System.

No of Spare parts Materials created in the last year

Number of new spare parts materials created

Rate of change per annum

Typical % material master records that are changed per year.

Hourly Rate of Master Data Maintainer

Hourly cost/salary of a master data steward.

Reduction

 

0 1%
50%
i Typical value ranges from 1-50%
0 5%
50%
i Typical value ranges from 5-50%

Reduction In Increase Procurement and Maintenance Productivity

Estimated Saving

$