SBS ebook: Making the case for standardization and consolidation
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Making the Case for Standardization and Consolidation A tool for improving manufacturing productivity
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SBS is a leading supplier of c-commodities and an expert in inventory management. One solution recommended by SBS is to take advantage of standardization and consolidation best practices. Read on to understand how SBS can help you implement a standardization and consolidation solution at your company that will minimize the number of different fasteners used, resulting in a reduction of part numbers, controlled inventory, reduced quality issues and overall lower costs for your business.
Transcript of SBS ebook: Making the case for standardization and consolidation
Making the Case for Standardization and Consolidation
A tool for improving manufacturing productivity
Purpose of this eBookIn a recent survey conducted by SBS, more than 80% of respondents indicated they experience difficulties or complications with the purchasing of their fasteners or c-commodities due to inventory shortages, quality issues, and excessive inventory, to name a few.
SBS is a leading supplier of c-commodities and an expert in inventory management. One solution recommended by SBS is to take advantage of standardization and consolidation best practices.
Read on to understand how SBS can help you implement a standardization and consolidation solution at your company that will minimize the number of different fasteners used, resulting in a reduction of part numbers, controlled inventory, reduced quality and obsolescence and overall lower costs for your business.
Do you often experience difficulties or complications with your fasteners or c-commodities?
Table of Contents Why Standardization and Consolidation?
What is Standardization and Consolidation?
BIG Cost savings potential
The Solution
A Case Study A large engine manufacturing firm
realizes the results of standardization and consolidation
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Why standardization and consolidation?
The Problem
The Resultspoor joint designexcessive product re-work inferior products Increased potential for obsolescence
“Any old screw will do...”
…AND
The Results
ExpensiveLong lead timesHard to find specialsAccounting and procurement nightmares
over-engineered fasteners
What is Standardization?
Process The selection of preferred
fastener designs
A commitment to convert existing parts to the preferred systems
Utilization of these same concepts in new designs
Analysis of all existing parts and conversion of special fasteners to standard parts
Results Shorter lead times
Lower per piece costs
A reduction of part numbers
Lower purchasing and administrative costs.
Reduce obsolescence
What is Consolidation?
Process
The analysis of the individual fasteners used in assembly and the evaluation of potentially replacing a troublesome, expensive part with a similar, less expensive, easy to find part.
Results Reduction in the
number of different fasteners or part numbers used
Shorter lead times
Lower per piece costs
Reduce obsolescence
BIG Results
Eliminate scheduling paperwork
Cost of inventory
Shipping costs
Material movement
Storage
Inspection (gauging and calibration costs)
Annual data input costs
Engineering changes
Cost savings of $5,000 per part per year
The SolutionAligning and partnering with a fastener expert to standardize
on parts to improve quality and productivity while reducing
overall fastening costs.
Standardization and Consolidation is NOT a clerical function
RequirementsManagement support
Engineering judgment
Purchasing know-how
Manufacturing knowledge
An understanding of manufacturing cost relationships
A case study
Vendor and Part Consolidation
Engine manufacturing firm
A leading engine manufacturing firm spent a disproportionate amount of time managing 50 suppliers of fasteners and c-commodities, and thousands of different part numbers.
Senior management targeted a reduction in the supply base for c-commodities from 50 to 1 and an overall revamp of their fasteners.
A Case Study
The ProblemDue to invalid information, the purchasing
department could not quote effectively
Supplier service issues such as missed quote deadlines, delayed deliveries, and unresponsive customer service
Excessive inventory costs due to unused inventory
Escalating per piece costs due to non-standard, difficult to find parts
A Case Study
The Standardization and Consolidation Plan
The Fastener Survey
a complete active part number list
a set of prints (or accurate description) for each active part
A review of each part for possible substitution
A Case Study
SBS assembled a team to develop:
The Standardization and Consolidation Plan
Part Review included:
A Case Study
Estimated annual usage on all parts Fastener size Fastener lengths Strength-grades-materials Head/drive styles Thread function and pitch Plantings/coatings Other unusual features Estimated annual usage on all parts A where-used list when available
The Fastener Survey
ResultsEliminated 20% part discrepancy
Lowered PPV while significantly reducing time spent managing fasteners
Exceeded target pricing goals
Reduced # of part numbers and inventory mix significantly
Developed transparent flow of information between customer and SBS resulting in improved customer service
Improved fastener quality and joint integrity
A Case Study
By eliminating a single part number, it is estimated that a large manufacturer can save $30,000-$50,000 over the life of the part in terms of inventory control, reporting and tracking.
Contact us Today! [email protected]
800-322-7878
About SBS
SBS is a full-service solutions provider of fasteners, vendor managed inventory (VMI) programs and c-class commodities. We manage the supply chain to lower costs, reduce inventory and streamline the supply base for our customers worldwide.Contact us Today!
800-322-7878
