Have you heard of the term SLOBs?
I don't mean slob, as in a person who is lazy and has low standards of cleanliness.
I mean SLOBs as in SLow and OBsolete inventory.
This is a term that is used to categorize inventory in order to target items for review or removal.
Here's the problem that I have with this: Slow and obsolete are not the same.
In fact, with spare parts inventory slow may well be a feature, not a problem.
As a practitioner in this field you will know that you stock spares that will not move frequently. In fact, it is often stated that something like 60% (or more) of spares don't move in three years.
We do this deliberately because of what I call the planning horizon.
What we should be really concerned with is excess and obsolete.
Unfortunately, EXOB or OBEX doesn't quite roll off the tongue!
When thinking about your EXOBs, what would you say is the primary cause that drives this unwanted inventory.
- Changes in your equipment needs?
- Vendor discontinued items?
- Planet merger or closures?
- Excess purchases?
No matter what the cause, ignoring the excess or obsolete inventory does not make it go away.
And doing nothing, does nothing.
However, if you are interested in taking action then please contact me to discuss how I can help you clear your EXOB and maximize the returns from any asset sale.
