ImageIn manufacturing, a common trend today is lean manufacturing (removing waste out of the production process). Most companies that are utilizing lean manufacturing have been doing so since 2009 due to the economic downturn in the United States. These companies have found themselves at an impasse when finding more opportunities to eliminate waste and cut cost in their process. Turning to the supply chain is a relevant option for these companies at this point, starting with major suppliers.

Manufacturers should work with their key suppliers to determine options for cost savings that have a long term impact. Key suppliers would work with their manufacturer to find a way to supply them by finding cost savings within their product, optimizing how the manufacturer and supplier’s systems work in tandem to supply their manufacturer, and looking at the most effective and efficient way to ship the needed material to the manufacturer.

Both the manufacturer and supplier should work together as a team to find these cost saving options. It can be from light-weighting a plastic bottle that still has enough structural integrity to protect the product to setting up min/max levels for replenishment of goods and reducing overruns and inventory. This is nothing new for most manufacturers but looking for those opportunities that can continuously feed the bottom line with strong savings year after year is something that most manufacturers do not look for and should.

S. Hunt, CEO of Empowered Strategy:  A Consulting Group, LLC

Empowered Strategy: A Consulting Group, LLC is a management consulting company that partners with small and mid-size businesses and non-profits in developing strategies to tackle critical challenges, implementation of new plans/processes, increase growth and revenue, and strengthen current systems. We help companies develop the best plan that is customized and suitable for them and their industry to garner success.  Find us at www.empowered-strategy.com.

 

 

 

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