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How to Improve the Shipping and Receiving Methods of Your Manufacturing Firm
Why shipping and receiving affects the entire process
A recent idea that reduced product weight by 60%, reduced fuel bills and reduced tire costs by 6%. With a fleet of over 100 vehicles, this is just one of five small project ideas to emerge from the High Impact Change Management program. Internal processes and practices are easy to create but difficult to actually change. Whether starting from scratch or overhauling an existing system, this general prompt list is a useful guide. Furnishing and designing becomes much easier when you have a map with a clear path marked out for you. Set as a 10 point list of general rules and implications, the idea is to help you think through the topic headings and support the thought process in an orderly set of steps. This method will help create an efficient system with minimal shocks and surprises that will inevitably manage all the changes. All quality systems benefit from thorough thinking through the job. Micro-managing this process now will save you a lot of money and time, and equipment selection will be much less risky.
design – Start with a design for the entire system or you will find yourself costing changes that rarely affect one small area of your business. Rule 1, therefore, don’t fuss over small bits of bad work because you’re likely to make things worse.
Traceability – If you don’t have the time to do it right in the first place, where are you going to find the time to do it right? Rule 2 – Think about how to get what you sent to your customer back to your supplier without bankrupting yourself in the process.
Handling – If you think handling and storage systems are expensive, wait until you foot the bill for labor, injuries, duplicates and damaged stock. Rule 3 – Design your operations to deal efficiently with puts. Everything in its place and a place for everything.. including a charging battery! (18 months ago, a few weeks after taking delivery of their new fork truck, a customer of mine let the battery run down. The truck cost around £38,000, a replacement battery only cost £5,000. Lost that too. Long time to sort things out).
Smallest unit of measurable cost – How much control do you want? Pallet size or pint size, do you sell bricks or diamonds? This is your report size for your monthly performance review and has a critical impact on how you interface with your supporting distribution and logistics work. Rule 4 – Collect the pennies and the pounds will take care of themselves
Storage – Including on-site or off-site stores, work in progress and what you expect suppliers and customers to hold for you. Never hold on to junk or old stock, get rid of it and use cash or space for more production. Rule 5 – Be sure of your operational space needs. These are your fixed overheads and if it doesn’t work, you will find these costs expensive and risky to deal with. Use other people’s overhead as a first low-cost option before committing yourself to a long-term lease. The fixed cost title is within reason!
Picking System – Typing is faster than walking so start with a thoughtful, functional list. Avoid simultaneous lifting of warehousing or production work. Make sure you have all your needs ready to choose your shelves. Keep stock identifiable by eye or scanning, both for picking and counting. Keep stock within easy reach of pickers or picking machinery. Rule 6 – Apply the Grand Prix Principle, the fastest stock movers get pole position!
Equipment – You will need it. Rule 7 – Treat your business like your children. Get the best and keep discipline and training a priority. If you think training is expensive, you certainly can’t afford ignorance!
Packaging – This requires that the product be properly identified up to its destination and no further. Make it like Christmas for the new owner but with Christmas paper. When it’s opened, it should have a magical Christmas cheer and should be protected from Santa’s little helpers and reindeer punches if the dishes are thrown down the chimney like Christmas. If you’re going to ship Christmas presents like Santa, make sure you have a good cross dock and marshalling system that makes counting and sorting quick. Rule 8 – Consider the journey from the shelf to the opening ceremony. You don’t want it back in pieces. Sending goods twice wastes resources and alerts customers to potential system problems.
packing – It is an operation and everything needs to flow hand in hand and with as few process interruptions as possible. If it is prepaid, quickly connect it to issue invoices or material notes or receipts. Rule 9 – Make packing as continuous and uninterrupted as possible as it minimizes errors due to distraction.
Minimum order values – Add the time required to turn over your product based on activity. Batch them in the smallest quantity that makes enough gross profit to pay for it, or whatever that quantity is that charges you the minimum, then consider Goodwill…or not! Rule 10 – Study your order book carefully and make sure the value you add covers your costs.
Bonus Idea – All systems should consider the environment. All systems should allow the workplace to remain tidy. Make sure your products are well protected but still easy to access. Products that have their own box or case should keep in mind the ongoing role and environment and better support maintenance and application ideas. Never miss an opportunity to tell a user what else you do, especially if it improves their day
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