Segmentation Survey of a Surplus Inventory in an Operational Mining Site Located in West Africa



A gold mine located in West Africa would like to sell its surplus materials. The asset has been in production for a decade and an excess inventory has built up over time. Attempts to sell the surplus have been unsuccessful for the past five years. It is urgent to find a solution. This inventory is particularly challenging as it contains 50,000 items across 4,500 references.



Methodology




In such cases the best approach is to start with a segmentation survey. This one consists in having a closer look at the materials to assess their physical condition.

1- Items that are in bad condition and not repairable shall be sent for disposal. This prevents spending time, energy, and losing reputation on items that would never find a buyer.

2- Items that are in good condition shall be immediately published. There are different avenues that could yield results within a reasonable time.

3- Items that are in bad condition and are repairable shall be assessed for either bulk sale or refurbishment.



Results





The surplus is spread across different locations within the mining site. It makes it challenging to survey, manage, and monitor. The survey results indicate that the surplus is mainly composed of spare parts, which can be valuable for maintenance and repair operations: 47% of the parts are in sellable condition and 4.5% are returned to the active inventory.

The inadequate storage conditions for some parts may pose a risk to their quality and usability: 7% of the parts are classified refurbishable. Moreover, the survey reveals that some items have an expired shelf life, which may render them useless or even dangerous when used. It is critical to dispose of these items and ensure that only usable and safe parts are kept in the surplus inventory: 2.5% of the parts are declared scrap.

The remaining parts (39%) are difficult to classify as there is a misalignment between the surplus list and the physical inventory of the surplus containers.



Recommendations and conclusions




The following recommendations are made:

1- Initiate selling of the parts in good condition.

2- Attempt a bulk sale of refurbishable items.

3- Implement a comprehensive surplus management plan with a central location for the surplus materials to gain efficiency.

4- Improve the storage conditions to ensure that the parts are readily available and in good condition when needed.

In summary, the segmentation survey provides valuable insights into the surplus inventory. It is a must-do before attempting to sell the excess materials: it enables focusing on the sellable items and achieving results in the best conditions possible. Addressing the issues identified in the survey can lead to a more efficient and effective surplus management plan.


If you need assistance with your surplus materials, contact us at sales@bdgrs.com.
Location: West Africa

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