One issue supporting speculative purchasing strongly in a panel shop is an urgent project request. The ideal supported is, “There should be enough components available to assemble one standard panel.”
Most major components can be acquired quickly. The caveat on acquisitions occurred strongly soon after the 2020 pandemic started. There were signs of material availability struggle pre-pandemic, but the manufacturing industry really began extended output delay within a year of the pandemic onset.
So, keeping with the original ideal, the MOQ was a bonus to the purchasing routine. Advantages of speculative purchasing:
- Keep ahead of potential part shortages.
- In the event an urgent project arrives, MOQ components will be available
- If the panel/project requires an over-sight design modification, ordering will be reduced.
My technique on purchasing is to round up MOQ if advantageous to the project and business. A disadvantage is if MOQ’s induce a project overrun.
Ex. 1: A project requires 10 Entrelec 2-tier terminal blocks for a single panel. The MOQ for the two-tier terminal blocks is fifty pieces. The best course of action is to check the project surplus shelves for availability to handle the project.
Ex. 2: A project has small panel count, for instance 4 panels of identical design, where the 2-tier terminal block count is 20 pieces per panel, giving a project requirement of eighty pieces. In this case, rounding up to two (2) MOQ’s would be project advantageous because taking from project surplus would be thirty (30) pieces. The tricky part follows:
- Administration requests the 2-tier terminal block to be maintained around 200 pieces.
- If surplus has only 75 pieces, the ordering for the project would be best at rounding up to two (2) MOQ’s, or 100 pieces, giving future flexibility with the component.
- Conversely, if surplus has 400 pieces, then pulling 80 from surplus would be preferred. For a business that does not keep stock, then keeping surplus at a smallish count would be preferred.
- Lastly, a change order may come in during assembly that the panel may be required to handle additional work load. To add another 16-point digital input or output module would require an additional 16 terminal blocks to handle the module. Then there may be interposing relays between the module and terminal blocks. The relays are more costly and if there are more than one relay manufacturer used across projects, relays may not be maintained at MOQ’s. Generally, components with a consistent use (e.g. DIN rail, terminal blocks, end caps, end stops, ground bars) are prime candidates for project surplus via MOQ’s.
A case regarding tracking MOQ’s occurred years ago with wire way. An estimate for wire way was generated for each project. Not watching for surplus eventually lead to having a large stock of various sizes. Wire way, while light, is also bulky even when boxed well. So for a while wire way was not purchased as wildly and the idea sprung up to order as needed. Suppliers do not cut wire way to meet project customer requirements. Since the wire way is a plastic type of material, it is easy to cut with an utility knife. If a project is large, then the designers will total the wireway and then request a purchase if surplus is not available.