Modern manufacturing businesses have one common problem which they share with almost all businesses. That problem is expense. Your mind may wander to think about the cost of product. Perhaps you think of the cost of logistics or the massive expense of delayed production. While those are all major financial stressors and are certainly worth significant effort to optimize, there is one cost which outweighs them all. The cost of payroll is often the most significant expense businesses face, and food manufacturers are no exception.
Reducing Cost Through Optimizing Resources
The best way for businesses to reduce the cost of their labor force is rarely by cutting payroll. It is much better for prudent businesspeople to make more efficient use of their existing employees. By making their work simpler and more efficient you can use their skills and abilities for more productive, revenue generating tasks.
This month’s story is focused on a customer who had a simple problem but no simple solutions. When they reached out, we knew exactly how we could help!
Sharing Space; the Good with the Bad.
Two of our customers are co-located in one warehouse. They inventory and produce their finished goods under one roof. One of the customers stores their material on plain wood pallets while the other uses a colored plastic pallet for easy identification. This helps the warehouse workers pull the correct product more reliably.
Imagine it, the warehouse bell rings signaling a driver has arrived. You answer the door and tell the driver to back into door two. Once they’ve backed in, you open your dock door, then the trailer door. Everything looks great! You unload the trailer, inspect the product, sign all the paperwork, and send the driver on their way.
One of the benefits of co-location is consolidation of deliveries. Both customers order from St. Charles Trading, Inc. and coordinate their PO’s to deliver on the same day. That saves time and money for all parties involved.
The product still needs to be sorted onto the appropriately colored pallets. As you close the dock door, you take a deep breath and prepare for the heavy lifting ahead.
The task at hand is not as simple as moving the received material into its appropriate location in the warehouse. You have inventory for multiple customers within the warehouse and you have developed a way to easily distinguish them by using colored pallets. One customer’s ingredients stay on the wooden pallets they arrive on, phew, no problems there.
On the other hand, the other customer’s ingredients are re-palletized by hand on to a colored plastic pallet at time of arrival and then put into inventory. Commence the sweat inducing, time consuming, expensive heavy lifting. What a pain!
How We Helped
Our customer reached out a few months ago to explain this problem and ask for our expertise in simplifying complex business processes. While they had been using this work-around for some time, something needed to change.
We brainstormed and asked ourselves plenty of questions. What if we could have the ingredients deliver on the colored plastic pallets, so our customer would only have to inventory the material when it arrived? What tools do we have at our disposal to help?
After a brief conversation with our warehouse manager and the creation of a new code in our inventory, we had a plan. Our customer was already ordering colored plastic pallets for use in their warehouse. On their next order they had them shipped to our warehouse instead. The pallets were assigned a special code in our internal system so they could be separated from inventory and stored for use on this customer’s future orders.
With every future order our warehouse would pull the ingredients needed and stack on the customer’s special colored plastic pallets. If they were ordering a full pallet of material, our pallet flipper could be used to switch out the wood pallet with a colored plastic pallet. Thankfully we already had the pallet flipper at our disposal.
Finding effective ways to reduce expenses often takes creativity. While the problem was simple, its solution was not. Working with St. Charles Trading, Inc. you’ll have access to out of the box thinkers who strive to leverage our talent and tools to increase the efficiency of our customers.
What problems can we solve for you?