Procurement fundamentals key to prevent failure of fasteners

author

By: Vinitha Viswanathan -- Research Analyst, IMD

01 January, 2017

ARTICLE

Abstract:

This article highlights the recent rise in fasteners demand for MRO industry as failure of fasteners increased in recent years. It analyses the impact of fastener failure on the overall cost of operation and highlights the savingsopportunity in terms of operational time and money at various stages of maintenance/operation. In addition, this article emphasizes the need forprocurement decision as it plays an important role in optimizing equilibrium between safety and cost.

Fastener Overview

Fasteners are hardware, used for making non-permanent joints, and are made of materialssuch as aluminum, stainless steel alloys, titanium, plastics, and some super alloys such as nickel alloy, Inconel and Monel metals. The materialsare selected based on the application. Fasteners are broadly classified into threaded fasteners (account for more than 80percentof fasteners production worldwide) and non-threaded fasteners. Theyare used in various industries such as automotive industry, aerospace industry, MRO and construction, industrial machinery, fabricated metal products and others. Demand for fasteners has been high in durable goods manufacturing due to increased infrastructure projects and construction activities coupled with demand inthe MRO Industry.

Global demandforfasteners for the2011-2016period grew at a CAGR of 1percent. It is projected to have a compounded growth of 2.7percentfrom 2016to $80.2 billion in 2018. Increased manufacturing and maintenance activities, increased automotive and aerospace equipment output will stimulate the fastener demand in the coming years. Asia pacific will have the highest demand for standard fasteners in the coming years due to increase in demand for maintenance and repairs activities, increased construction activities and automotive industry growth. However, regions such as European UnionandNorth America will see comparatively higher demand for aerospace grade fasteners. MRO along with construction contributes around 26percentof fasteners demand. MRO’s attribution to fasteners demand is expected to rise. There has been a concern about the quality of fasteners and the failures associated with them, leading to more maintenance and repairs of fasteners. Failure of fasteners can have disastrous consequences based on the stage at which the failure is rectified.




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