Subscribe

Latest Blog Post

New Call-to-action

Increasing Productivity in Manufacturing: Optimizing the Cost of Raw Materials

Karine Simard
by Karine Simard on Oct 18, 2016 7:00:00 AM

Raw_Materiel.pngWhile raw materials are usually an easy target to cost reduction and optimization, you should look at the other  variables first: labor costs, factory layout, quality control, energy consumption and machine runtime. Go on, we'll wait.

Now that you have increased production, you are getting more parts out of your process. Therefore you must be using more raw materials than you were before!

shopfloor.jpg

Now it is time to use this argument as leverage in negotiating prices with your suppliers! Look at different suppliers carrying  the same product line or similar products. Even though pricing may be the main decision driver in the process, keep the following in mind because they are just as important.

  • Getting good technical support from the supplier will help you solve issues that you may run into with your product.
  • Credibility of the supplier. If you are using a well known supplier, it is easier to trust the product, there are fewer chances that the supplier will shut down and if they allow you to do it, you can use their name in your marketing to promote your product such that your customers know that you are using quality materials to make your product.
  • Lead times and delivery. You need to make some calculations here. If some suppliers have a lower cost than others, but require large batch orders, there is a cost associated with stocking inventory. Furthermore, if you are in the high tech industry, products change and evolve fast. So if you start holding large inventories there is a higher chance that you may get stuck with unusable product if it becomes obsolete at some point, say because new product is being released.
  • Shipping and customs. While some suppliers will boast much lower costs than their local competitors, include shipping and customs fees in your cost calculations. Often these will offset a large chunk of the savings.
  • Avoid changing and switching between suppliers all the time for lower prices. This does not create a good relationship with your supplier. I would not say don’t go out and shop for other prices, but before making the switch to a new supplier, make sure you discuss this with your current supplier. Often they will match your specs and price.

Don’t forget that the optimized production produces what the client needs, no more and no less. Beyond the cost of raw materials and the growing production runs, you should also aim to avoid overstocking finished products. With this in mind, you may want to negotiate agreements with your suppliers that commit to certain quantities of material purchased, but with deliveries in smaller batches. This could allow you to obtain better pricing.

Read more about optimizing productivity in our eBook: Optimizing the Productivity of Existing Equipment.

New Call-to-action

 
x

Subscribe to Robotiq's Blog

Leave a comment

Karine Simard
Written by Karine Simard
Karine is a journalism-school graduate turned marketer with a side-step in sales and the addition of an MBA to complete her understanding of business. She has documented, marketed and sold products in the high-tech industry, from power monitors to people counters, enterprise software and telecom testing solutions. She cares about team dynamics, marketing and generating quality leads for her teammates in sales. Her mission is to bring sales and marketing teams together into one happy revenue-generating machine.
Connect with the writer:

Related posts

Increasing Productivity in Manufacturing: Optimizing Energy Consumption

Another factor that you probably want to look at to improve your productivity is your energy consumption. Of course, some...

Karine Simard
By Karine Simard - September 29, 2016
Increasing Productivity in Manufacturing: Optimizing the Production Layout

Another key aspect to increasing productivity is making sure production flows smoothly. One of the many aspects ensuring this...

Karine Simard
By Karine Simard - September 21, 2016

Using 2 finger gripper attached to UR10 through ROS

Hello,We have a robot UR10 with a 2 finger gripper connected to the Robot controller through one of the USB port. We can manage to control the robot using the modern driver and ROS on another network...Read more

ROS Configuration for the C-Gripper

Hello,We have a problem with the communication with a robotiq gripper using ROS. I will explain the problem with more detail to check if you can help us.We have a robot UR10 with a C-model Gripper (2...Read more

How can I make a UR5 draw arcs and circles?

Hi!I want to make the UR5 make draw random lines, arcs and circles on a piece of paper. My approach for that so far was to generate the geometry in Processing (Java for creatives..) and send points...Read more

Improve cycle time when using the Robotiq Gripper

Hi Pros,In some applications where cycle time is critical, saving a few seconds here and there can be important. Here's a new program template that allows you to save a few tenths of seconds...Read more