When you look at everything you need to keep your small business running, it’s easy to forget the little things: extension cords, ladders, paper towels, power tools, storage equipment, hard hats, gloves, etc. All of this goes into the category of MRO — that is Maintenance, Repairs, and Operations. Here’s why having an MRO strategy is essential!
According to Logistics Management, these mundane items can make up a significant part of a company’s expenses, but without a solid MRO procurement strategy, half the time they are never available when needed. This leads to spot-buying. And with 26% of companies admitting they are not prepared with a standing MRO strategy, and 30% of facilities not being proactive in that realm, it’s no wonder that the cost of MRO spending is rising — global MRO spending is expected to increase by 46% by 2026.
It’s something that small and midsize companies need to be aware of — and their ability to pivot helps them be the most adept at adopting a sound MRO optimization. When you're working on a relatively small scale, suddenly needing to overnight ship a necessary part to yourself or ordering from a random vendor without shopping around may not seem like high-priority issues to tackle. Similarly sitting on a few extra materials might elicit a “big deal?” response, as you will probably get around to using them in the future.
But as you scale up and grow, you realistically can't afford to have unnecessary expenditures. By minimising your spend on excess, and focusing on what you need right now, you can use the cost savings to grow other areas of your business at a greater rate. And being able to shed unnecessary expenditures ultimately makes your business more agile. You’ll have more time and money to shift from one direction to the next, based on trends, market needs, resources — and even emergencies.
So what does a good MRO strategy involve? Following best practices doesn’t have to be expensive! Partnering with the right supplier can help with selecting the right products, managing a lean but useful inventory, and being aware of innovations on the market. And all of that will help make your business more efficient, whether it’s better cost control, improved performance, increased supplier involvement, or great operating margins.
For more information on how Vallen Canada can assist your small or medium business, check out our Small/Medium Business page!