Turning Spare Parts into a Strategic Asset

As supply chains strain and capital grows more expensive, the overlooked inventories sitting on factory shelves have become a frontline test of resilience. Dr Lukas Biedermann, COO and Co‑Founder of SPARETECH, sees the shift as fundamental.

“Spare parts have become a major capital and performance lever,” he says.

“Large manufacturing companies hold $169 million in spare parts inventory on average. At the same time, 18% of parts remain unused after five years, representing locked capital with no return,” he adds.

What is changing, he explains, is not just the data but the executive perspective.

“C‑level focus is shifting toward working capital and free cash flow. At the same time, global supply chain instability is increasing both the cost of stockouts and the tendency to overstock.”

Yet, companies cannot simply solve the problem by storing more.

“They cannot store all critical spare parts because of capital constraints, storage costs, and limited space. That’s why the industry is recognising that spare parts are not just a cost factor but a driver of both balance‑sheet performance and operational reliability.”

The turning point, Biedermann argues, comes when spare parts stop being treated as passive inventory and start being recognised as a core component of reliability.

“Spare parts management becomes a reliability issue the moment the right part cannot be found quickly,” he says. “In many cases, organisations do not find the required parts at all.”

In practice, that gap forces maintenance teams to improvise.

“Urgent requests are sent through mailing lists across factories when a spare part is needed. This directly delays maintenance because poor data quality and limited transparency across sites lead to longer mean time to repair, costly emergency purchases, and an increase in unplanned downtime,” Biedermann explains.

At that point, the boundary between supply chain and operations disappears — reliability becomes inseparable from spare parts data quality, cross‑site transparency, and fast access to critical materials.

“Reliability depends on fast and accurate access to the right spare parts, which in turn relies on global transparency and reliable spare parts data within ERP and asset management systems. If that foundation breaks down, maintenance performance breaks down as well.”

According to Biedermann, one of the most persistent barriers is visibility.

“The biggest challenge is transparency,” he says, citing the SPARETECH Global Survey 2026. “53% of manufacturing organisations lack global visibility into machinery and equipment spare parts across their factories.”

The consequence is predictable and costly.

“Without that visibility, duplicate purchases occur every day. Inventory continues to grow, often by double-digit percentages year over year, while no one is able to break the cycle.”

For Biedermann, this is not simply a tooling problem but a structural one.

“Sharing spare parts across sites and avoiding duplicate purchases can only be achieved through standardisation and by continuously ensuring that clean data enters the system. Without a strong data strategy across the asset lifecycle, every plant operates in isolation.”

The operational impact of this fragmentation is most visible in maintenance performance indicators.

“If companies lack visibility and spare parts cannot be located across sites, teams in isolated factories often reorder parts instead of using existing inventory,” Biedermann says.

“Given that 18% of purchased spare parts are never used, nearly one-fifth of all materials sitting in factories at any given time could potentially be utilised elsewhere.”

He adds that when transparency improves, the effect is immediate: parts can be located faster, cross-plant sourcing becomes possible, and mean time to repair can be reduced.

“Better visibility enables faster repair decisions, and faster repairs lead directly to higher uptime and improved asset reliability.”

Despite significant investment in predictive maintenance and digital transformation, many organisations still underestimate the importance of master data, notes Biedermann.

“Data quality is one of the biggest gaps we see today,” he says when asked whether companies are overlooking fundamentals.

He points to a structural mismatch between operational speed and administrative systems: “On average, creating a material takes nine minutes of net effort, but it can take up to two or three weeks of total cycle time before a new material number is issued in the ERP system. Maintainers cannot wait that long.”

The result is a culture of workarounds that erodes data integrity. “Teams often create free‑text orders simply to obtain the required part,” he explains — a shortcut that ensures critical information never enters the system.

Sparetech helps global manufacturers address these challenges from the ground up with an integrated MRO software solution that spans every step of spare parts management. It transforms the data foundation behind every decision, strengthens governance, and optimizes inventory, sourcing, and surplus monetization.

“It provides a foundational data backbone that helps manufacturing companies improve predictive maintenance, operations management, and spare parts procurement,” Biedermann says.

However, he is careful to emphasise that technology alone is not enough when companies attempt to standardise spare parts data across regions and plants.

“Deduplicating a global material master is never easy because the first step is deciding how to set up a governance model that can sustain a clean material master after the cleansing process is complete.”

Biedermann points out that success depends on structure before execution.

“Starting with policies and guidelines and thinking backwards from the desired end state is therefore a very good approach.”

Even the most technical steps require organisational clarity.

“Once data cleansing begins and duplicates are identified, it is crucial to define clear rules. For example, which material should be considered the leading material? Should a deletion flag be applied?

How should the work be distributed across different factories?”

Real-world implementations illustrate these principles clearly. At Nestlé, transformation results were driven by a combination of data, adoption, and transparency.

“There were three key success factors,” Biedermann explains.

The first was establishing a standardised data foundation: “We cleaned and enriched the data with original manufacturer information while identifying duplicates and obsolete materials.” The second was a user-centric rollout and adoption strategy: “Together with the Nestlé team, we implemented a strong train-the-trainer program across all global regions.”

Meanwhile, the third was creating global transparency across spare parts inventories, explained Biedermann.

The behavioural impact was as important as the technical one.

“By making spare part stocks visible across factories worldwide, Nestlé enabled teams to identify existing inventory, reduce duplicate purchases, and increase the use of material plant extensions rather than creating new materials.”

Artificial intelligence is often presented as the solution to industrial inefficiency, but Biedermann offers a more grounded view.

“The most recent industry survey we conducted shows that 99% of companies have not yet seen measurable success using AI for data cleansing alone,” he says.

Still, he sees clear value in embedding AI into structured workflows.

“Within our SPARETECH workflow solution, we have introduced Standardize, an AI feature that creates fully accurate, structured short descriptions within ERP length constraints, based on the  team’s defined rules, and translates those descriptions into multiple languages.”

The impact is practical rather than abstract.

“These translations are critical when printing labels for storerooms. This helps teams make better real-time decisions and prevents unnecessary spending on parts that are already available.”
Yet AI, he stresses, cannot replace governance.

“AI is certainly not the answer on its own. It is an accelerator, not the foundation.”

The real prerequisite lies elsewhere: “Success depends on having access to original manufacturer spare parts information that can be mapped to company-specific material master fields,” Biedermann says.

Without that, even the most advanced systems fail to deliver reliable outcomes.

Looking ahead, Dr Biedermann believes the gap between leading organisations and those still developing their capabilities will widen significantly. He highlights three capabilities as particularly important.

“The first is achieving full transparency across all plants and inventories. Today, only 47% of businesses report having this level of visibility in some form,” he says.

“The second is establishing a strong data foundation supported by global standards and robust master data governance processes.”

“The third is implementing standardised workflows that enable collaboration across sites and ensure data quality is maintained over time.”

He notes that these capabilities are not standalone improvements but are directly connected to financial and operational performance.

“These capabilities lead to lower spare parts inventory ratios, reduced maverick buying, and significantly lower levels of excess inventory. Ultimately, this improves free cash flow while helping organisations minimise downtime and operate more efficiently.”

Lukas Biedermann

Dr Lukas Biedermann is Co‑Founder and COO of SPARETECH, where he works to build a more efficient and collaborative ecosystem for industrial spare parts data. Before launching SPARETECH, he managed international automotive, aerospace, and manufacturing projects at Porsche Consulting, developing deep expertise in supply chain transformation, digitalisation, servitization, and CO₂ reduction. His academic work is also widely recognised: his 2018 dissertation on supply chain resilience has been downloaded more than 64,000 times.

Text: Nina Garlo-Melkas Photos: SPARETECH