A TD-ABC Model for the Computation of the Total Cost of Ownership of Spare Parts

Paulo Afonso, Orlando Durán

Research output: Chapter in Book/Report/Conference proceedingChapterpeer-review

Abstract

The costs of spare parts represent an important share of the operation and maintenance costs of capital goods. Spare parts may remain in depots and warehouses for long periods of time, and, many of them require logistics activities. There are several life-cycle cost estimation models for capital-intensive production systems however, commonly, they do not consider logistics costs adequately. Thus, to incorporate all these aspects into the computation of the cost of ownership of spare parts, a time-driven activity-based costing model is proposed in this paper. Furthermore, since the dynamics of spare parts management are based on the reliability of the components, the Weibull’s function is integrated into the model. An application is presented considering a logistics distribution center. The presented approach allowed the costs estimation besides the idle capacity estimation, two important information inputs in logistics management. The results show the usefulness of the proposed model. The opportunities for further research and applications are also discussed.

Original languageEnglish
Title of host publicationLecture Notes on Multidisciplinary Industrial Engineering
PublisherSpringer Nature
Pages173-182
Number of pages10
DOIs
StatePublished - 2020

Publication series

NameLecture Notes on Multidisciplinary Industrial Engineering
VolumePart F201
ISSN (Print)2522-5022
ISSN (Electronic)2522-5030

Keywords

  • Spare parts
  • Time-driven activity based costing
  • Total cost of ownership

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