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In the hospitality industry, well-managed maintenance, repair and operating (MRO) inventory can mean better service. Customer service is critical to keep guests coming back. Hotels, by their very nature, have many moving “parts.”  With hundreds (sometimes thousands) of guests moving about the property every day, facility managers need to keep the front of the house in perfect shape. That means that sparkling lobbies, freshly made guest rooms and enticing food areas must be apparent at all times. If a light bulb is burned out or batteries are missing from a TV remote, it needs to be addressed in a timely manner. If these simple supplies cannot be sourced quickly or are out of stock in the central storeroom, the guests will feel that their issues are not being taken care and most likely, will not return as a future customer. Keeping your property in excellent working order is not only more cost effective in the short term, but also helps ensure guest loyalty which translates into revenues.

Some issues that properties may experience in trying to manage their own stock room of MRO inventory might include:
• Uncontrolled spending
• Overstocking of seldom used parts
• Running out of stock of key parts and supplies
• Excessive labor activities, i.e., emergency runs to the local hardware store
• Poor asset utilization
• Inefficient ordering process
• High inventory carrying costs (too many slow-moving items)

Do you really know how much you have? Let’s take a look at surplus inventory. Let’s say that two years ago, you made a decision to convert all incandescent light bulbs in your facility to compact fluorescent light bulbs (CFLs). That’s great for your bottom line energy costs. But now what do you do with the 40 cases of incandescent bulbs in your stockroom? The average turnover of MRO inventory is a year or more, so at least half of it is commonly considered inactive. You might defend your “inactive” inventory as critical items with long lead times with sporadic usage, but when they are needed, guests can’t wait. It may be helpful to classify your MRO inventory items as critical, fast, slow or inactive. Inventories are typically driven by fear, not experience. Some people are afraid of the consequences of a stock-out, regardless of whether or not they actually experience stock-outs. This fear may help drive demand and excessive supplies. The key is to understand the needs of the facility, not the individuals, and use the facility’s requirements to generate demand and manage supply. Stockrooms are kept for convenience, but tend to be hoarded and piled up for that “just in case” moment in time. You may find parts and supplies in every nook and cranny, in desk drawers and unmarked cabinets in distant recesses of the facility. Even the best organized inventory can take valuable time to place orders, receive, put away, cycle count and issue. It may take upwards of 90 minutes to replenish an item depending on your system.

Inventory Solutions That Work For You
Well-managed inventory programs may be the most practical solution for saving time and keeping hotel maintenance supply costs in line. There are several types of programs available to suit the varying needs of a hospitality supply chain. These programs typically use turnkey web-based tracking software with bar coding technology to manage stock room inventory. Optional detailed usage reports can be provided to track supply costs. Here are two popular inventory solutions to help manage the everyday supply logistics for a typical hospitality environment:
• Vendor Managed Inventory Management System (VMI) - Outside supplier provides software, PC hardware, bar code labeling systems and training. With this automated system, the designated supplier schedules weekly, bi-monthly or monthly visits based on the needs of the hotel facility manager. The supplier analyzes the inventory usage and places orders for replenishment.based on current usage levels. Supplier orders, delivers and restocks items at each storeroom.
Key benefits of the Vendor Managed program may include:
1. Possible reduced staffing costs since the supplier is managing the stocking levels.
2. Storeroom inventory levels that can be mutually agreed upon
3. Time savings from reduced product searches and organized stockrooms
4. Cost savings on reduced rush shipment fees

• Customer Managed Inventory Management System (CMI). This self-managed approach uses the same processes and technology as the VMI system. Hotel facility management identifies key supply items, organizes stock rooms and reviews current usage reports to help understand the flow of inventory. Bins and shelves are labeled with bar codes to help track all movement in and out of the storage areas and provide detailed reporting. Hotel staff manages on-site inventory with scheduled replenishment from the supplier. Key benefits to the Customer -Managed inventory program may include:
1. Automated tracking that will allow your workers to focus on their jobs rather than trying to find what they need
2. Easier ordering of MRO materials
3. Reduced order processing costs
4. Automatic detailed and timely purchase order history reports Well-managed MRO inventory means better business.
No one knows that better than the Senior Buyer for a large hotel resort in Lake Tahoe, Nevada . The resort encompasses three properties with multiple restaurants, a casino, convention facilities and hotel towers – all open 24 hours a day, 365 days a year. The Buyer needs to make sure parts are available to keep dishwashers running and lights glowing. It’s an important part of customer service. Planning is essential. Since the facilities are in a mountainous region, it's not practical to hop in a car to get the needed items. The closest supplier source may be two hours away. One common pitfall that this particular resort was facing was a stockpiling of consumable and repair items. They did not have a program in place that would report out-of stock items. Therefore, facility employees did not trust the system and would hoard items in several locations to make sure it was readily available. To solve these problems, a VMI program was put into place. Inventory is now kept in five storerooms located in three locations on the properties: two for housekeeping, two for lighting and one as a central stockroom. The Buyer reports that hoarding is no longer an issue. They are also enjoying additional savings from quantity discounts and fewer rush order fees.

If you are considering moving to an automated inventory management program for your property, here are some key questions to help guide you through the decision-making process:
1) Are you always sending a staff member out to purchase random maintenance items? You may be surprised to learn how much time is being wasted
2) Is your staff “hoarding” supplies since it seems that the high-usage items are never on the shelf in the central storeroom? You may have excess dollars tied up in these types of items.
3) Does your storeroom contain many obsolete supplies that are taking up valuable space? A well-managed automated inventory program can help eliminate this issue.
4) Is your supplies usage documented using an inventory tracking system? Detailed reporting will help you document your true cost of MRO supplies.
5) Having trouble submitting a budget? A well-documented automated inventory program can help you track your ongoing MRO expenses. With growing pressure to add value to the bottom line, a smart inventory solution gives properties a competitive edge. Not only does it promise accurate and timely supply and new efficiencies, it can curb out-of-control costs, overstocks and waste. That means better guest service and loyalty for the long term.

Grainger is positioned to consistently supply the right product, to the right place, at the right time. Their integrated solutions will help improve efficiency, maximize productivity and reduce total cost by helping to minimize customers’ inventory investments, as well as the time and effort required procuring them. Focusing on reducing waste in MRO procurement practices can be beneficial and tangible for any organization. For more information, contact your Grainger representative or your local Grainger branch location. Visit www.grainger.com/inventory