9 Aircraft Parts Inventory Mistakes and How You Can Fix Them


Inventory planning is an art form. Done correctly, it can save your business big bucks and valuable time. Done wrong, – aircraft parts being purchased and not meeting projected rotations – the inventory goes from being an asset to becoming a liability.

This short guide to aircraft parts inventory planning will examine all the crucial mistakes that can occur, and how to set your business up for success with proper aircraft inventory operations management.

1. Your Employees Are Not Sufficiently Qualified

Nothing causes monetary leakage quite as much as disorganization in your warehouses. If your employees are not properly trained and qualified inventory management specialists, working within standard parameters using appropriate inventory management software, you can say goodbye to millions of dollars. s.

Storing different categories, such as aircraft parts, components, consumables, chemicals, lubricants, and retables, calls for different methods and conditions. Unnecessary damage can be avoided when you know how to keep each item. Aircaft inventory specialists with proper background and knowledge can maintain optimal storage conditions.

Overstocking and understocking are also lethal for your business. Buying aircraft parts and planning aircraft inventory are two different things that require two different skill sets and therefore should be taken care of by separate departments. A buyer’s objective is to purchase, while a planner’s objective is to achieve your materials-in-stock goals.

Hire people with the right experience, hold managers accountable for their department, separate your aircraft parts buying and planning activities, and make sure you train your staff initially and periodically.

If your employees are not qualified aircraft parts inventory management specialists, you can say goodbye to up to millions of dollars.

2. Too Many Part Numbers All Over the Place

Aircraft parts stock accumulation is something that happens naturally over time. We know that. Ideally, this situation must be decreased to a minimum, using strategic tools. Usually, you can spot a problem when there’s a scramble while filling lower-volume items, or when 20% of your high-usage PNs no longer account for 80% of your demanded items.

Having no stocking policy is also a problematic issue. Your specialists must facilitate a control-focused procedure for stocking each item in a specific warehouse or station.

When procurement departments overshadow planners, part number levels are not tracked, and the stacks will start piling up. A smart inventory planning policy will enforce your buyers to supply a reason for stocking an item and diminish clutter.

3. You Do Not Invest in Your Vendors

One of the biggest mistakes inventory mistakes is not nurturing the relationships with vendors. In every procurement-based business, 20% of the suppliers account for 80% of the growth. You must identify those ‘growth engines’ and do your best to establish mutual trust with each and every one of them. You need these vendors. Moreover, their performance is a direct result of how your operation is running.

AOG is stressful, we know. However, creating more stress by demanding, micro-managing, and being aggressive with your vendors will not solve the problem. It will widen the gap and earn you a dissatisfied, disloyal supplier.

Start developing effective communication skills by keeping the channels open, sharing your business goals, and discussing problems as they arise. It is the best way to ensure mutual success.

Meet with your top aircraft parts vendors quarterly and present them with a performance review. Talk with your dedicated Account Manager often, not only when there is an issue or crisis. Make sure your employees create an open, solution-oriented dialogue with all vendors.

Meet with your top aircraft parts vendors quarterly and present them with a performance review.

4. You Do Not Measure Your Performance

It’s not hard to detect a downward trend. Your business performance is decreasing, and it is, most likely, due to the fact that your aircraft parts inventory is managed poorly.

No matter if it’s the speed your aircraft inventory moves through the various delivery stages that causes this issue, or if it is your customers’ satisfaction – your inventory management has a key role in your business’s future. And it all starts with measuring your turns and efficiency.

Incorporate mandatory tracking of fill rates and inventory turns. Your Material Managers should know these numbers. Make sure you track fill rates daily, monthly and quarterly. Inventory-turn tracking frequency differs according to your operations. After you have sufficient stats, it’s time to delve into the insights and draw conclusions; is your aircraft parts inventory serving the demands your business receives? Or are you putting your focus on the wrong items?

Look at the current consumption patterns; what is being sold and when, the quantity you distribute per item, per client, etc. Once you have all the accurate stats, it is easier to foresee what next year will look like. There WILL be deviations, but as long as your predictions are based on real data, you should not be off target.

Track fill rates & turns; is your aircraft parts inventory serving the demands your business receives? Or are you putting your focus on the wrong items?

5. No Aircraft Part is the Same

We mentioned this point earlier. Different part numbers require different storage conditions. Not all items are consumed in the same quantity or rate. It is wrong practice to handle C items like they were A items.

The best way to set correct goals for each part number is to implement an ABC analysis, manage each material differently, and to use safety time as a key parameter in your aircraft inventory planning (rather than safety stock).

Most organizations utilize safety stock (an additional quantity of an item held in inventory in order to reduce the risk that the item will be out of stock) as a key component in their inventory planning. However, this can be ‘hit and miss’ when markets shift and technology progresses.

While safety stock is used to provide a buffer for demand variation, safety time provides a buffer for delivery and lead time variation. When you use safety time as the leading indicator, you bring in aircraft parts inventory prior to the time it is actually needed.

When safety time is used, the average inventory is one-half the replenishment quantity plus the remaining existing inventory on-hand when the replenishment quantity is delivered. As a result, you carry much lower safety inventory quantities.

An excellent strategy to improve inventory performance and turnover is to use safety time on slower-moving B and C items. This practice provides a level of safety coverage late in the replenishment cycle when stockouts are more likely to occur.

6. You Are Not Using Automation Tools

Are you still tracking inventory manually? Researchers found that for every 300 characters, a data entry operator makes one error. And because you probably carry hundreds of thousands of stock items, this can cause a major headache. Automated processes increase efficiency, improve accuracy, and are scalable to company growth.

Using an Excel file is slow, inaccurate, and does not allow multiple users to access it simultaneously. By automating your inventory management, you will be able to see how your employees track various items across numerous locations, all while monitoring orders and shipments for those items.

If you don’t already have one, implement an ERP system, automate routine tasks, and significantly reduce mistakes and waste.

As your business grows, the complexity of your aircraft parts inventory system also increases. Having a scalable system will help ensure a smooth transition. Automating now can help mitigate any issues in the future. Why waste time and money solving future problems when you can prevent them now?

Once your aircraft inventory is automated, you can integrate it with the ePlane platform and automatically receive RFQs from leading airlines, thanks to the revolutionary ePlane Autopilot.

Automate your aircraft parts inventory system and see how your employees track various items across numerous locations.

7. You Do Not Count Your Inventory Often Enough

Sure, your team checks inventory levels every so often, but do they count EVERYTHING periodically? Counting your entire inventory is crucial to the calculation of one of the most important financial indicators for your business – Cost of Goods Sold (COGS). COGS can account for up to a third of your total expenses. So yes – it can make or break your business.

We know that this can delay the work, however, if you check one section per day, you won’t have to shut down the entire operation.

Counting your entire aircraft parts inventory is crucial to the calculation of the Cost of Goods Sold (COGS).

8. Your Internal Communication is Failing

If your managers are used to operating in silos – it can be lethal to your aircraft parts inventory management.

For example, if your Procurement Manager has separate goals from those of your Maintenance Manager, your business will have to endure either overstocking or insufficient supply.

Each and every one of your department managers must operate together as a single, cohesive unit. Set weekly syncs, make sure everyone is in the loop, and encourage open communication channels at all times.

9. Your Shelves Are Disorganized

Order vs. Chaos. Such an important factor in life. And when dealing with aircraft parts inventories, it can save your business. How much time, on average, does it take your warehouse workers to find a part number? We encourage you to time them. Can you imagine how much money you can save if you diminish this time to a minimum?

When you implement structured storing systems inside your aircraft parts warehouses, productivity will increase. Use pre-draw kits for routine check-ups at an arm’s reach, store highly-used expendables closer to the technicians, and keep no-go MEL rotables in a quick-to-access space.

And most importantly: lose the clutter! Your aircraft spare parts array does not have to be all-encompassing. You do not need thousands of items from the same unique PN. For better control over your aircraft inventory, you need to define and categorize airplane spare parts. What can be labeled ‘critical’ and must be on-hand? Which PNs are negligible and can be ordered upon request?

Summing Everything Up

The quickest way you can run your business into the ground is by not adapting and updating procedures. 

Have you been doing the same thing for 20 years? If so, most chances are you are managing your aircraft parts inventory inefficiently.  Whether you own a two-man shop or a 1,200+ person repair station, we advise you to use these nine guidelines as a framework. They will help identify pitfalls and build a management process that will keep customers satisfied, vendors communicating and employees engaged – all which result in a better-run, profitable business.

Have you developed your own inventory management strategy? Email us! We would love to hear more about it.

Don’t have an account yet? Join ePlane now.