We optimize your supply chain

Incoming transports

Do you know the amount of your freight costs? And do you know which transport service providers cause them? How often do you run a freight tender? These are the questions we ask our customers in the initial discussions. Freight costs are often a little-noticed cost block, but they hold great potential for optimization and are the first step towards process optimization in logistics. It is also important to consider all freight costs, i.e. inbound and outbound shipments, together. This is the only way to identify potential synergies. With a freight tender, we help our customers to save an average of one fifth of their freight costs.

Goods receipt

Undefined delivery windows, truck jams in front of the goods receiving area and resulting downtimes that cause unplanned additional costs – we often observe that successful yard management is a challenge for our customers. This also creates an uneven distribution of work volume in the goods receiving area. If several trucks are ready for unloading at the same time, this can cause an overload of employees in the goods receiving department. Overwork and dissatisfaction are the result. Often, inadequate incoming goods inspection is also the problem: Incorrect deliveries are not immediately noticed. Inefficient processes and inadequate planning in the incoming goods department can therefore drive up costs unnecessarily, be it personnel costs or indirect costs for technical equipment. If you want to optimize your incoming goods department, should take a closer look at the above mentioned processes.

Empties handling and pallet exchange are also very error-prone, especially if there is no data basis. If no empties account is kept with suppliers, this can result in high costs because evidence is missing or differences are not tracked.

Storage

Some companies struggle with identifying the appropriate storage or rack type. Incorrectly dimensioned storage locations for example can result in too much space being tied up or make it inevitable to repack goods using smaller containers. These problems can be avoided by the correct choice of storage space dimensioning. In addition, aspects such as the possibility of FIFO (First In First Out) retrieval or the ergonomics of the storage and picking equipment must also be taken into account.

Inventory management in the warehouse

A well-known problem in the own warehouse are high inventories and high storage ranges. But sometimes less is more. After all, holding a lot of stock ties up a lot of capital and storage space and increases the sales risk. Above a certain inventory level, process-related disruptions can also occur, resulting in long and inefficient routes.

The small selection of free storage locations also leads to avoidably long process times, not to mention efficient storage strategies that should be based on regular order structure analyses. Another consequence of an excessively high stock level can be reaching one's own capacity limits. The resulting question that companies often ask themselves in such a situation is: buy or rent more warehouse space? Or is it possible to reduce the space requirements and create space in the already existing warehouse areas by optimizing the inventory?

Through a detailed analysis of the data structure, we can help you uncover your potential for optimizing inventories and implement this while maintaining at least the same level of delivery reliability.

By the way:

High inventories are often a sign of (dispositive) problems. Especially in times of crisis, as recently caused by the pandemic, when disruptions in the supply chain inevitably reduce a company's own inventories, such problems hit a company even more. A frequently occurring phenomenon is unplanned overstocking (buffer stock). This results in the typical non-movers.

Technical implementation

Outdated or non-existent technical aids for picking (scanners, barcodes, etc.) often make picking processes less efficient and more prone to errors. Last but not least, the lack of clearly defined storage locations (e.g. in block warehouses) can lead to a high search effort during the picking process. In the area of (fine) picking, replenishment of the picking locations with varying frequency is necessary, depending on the article specification and picking strategy. If this replenishment process is insufficiently controlled, a delay in the process can occur due to a lack of material. This results in a so-called bottleneck.

Error rate

Do not underestimate the high error rate in the picking area: non-standardized processes frequently lead to picking errors. An example: The employee already pre-posts processes, although he has not yet physically completed them. The traceability of which steps have already been completed and which are still open can no longer be guaranteed.

Internal transport

Let's talk about ants, forklifts or pallet trucks: Many companies have no or little knowledge of the utilization of their industrial trucks. Without regular productivity measurements, it is not clear whether this is too high or too low. When utilization is low, unnecessary costs are incurred for both owned and rented industrial trucks, as maintenance, repair as well as rent are fixed costs that exist regardless of equipment utilization.

Often, improvements could also be achieved by using other industrial trucks that are better suited to on-site conditions. In the case of inefficient intralogistics flows of goods, employees may not be able to supply machines with new production materials in time, which in the worst case can lead to machine downtime and unproductive time for production employees. Consequently, intralogistics contributes to high machine utilization and thus to value creation.

Generally speaking, it is advisable to analyze an employee's so-called effective circles: How high is the proportion of his or her value-creating activities? And how much time does he spend on non-productive activities? It is not uncommon for production employees to also take on logistical activities such as material provision, handling empties, waste disposal, etc.).

Shipping

Similar to the goods receipt department, the processes in the shipping area, also called outgoing goods, suffer from the consequences of inadequate yard management. A lack of delivery notification leads to congestion in shipping or goods issue, makes planning more difficult and thus the timely provision of shipping documents, which ultimately affects the delivery performance. In addition, a lot of space can be tied up in goods receiving because it is not clear when which truck will arrive. As a result, many shipments have to be staged. With fixed delivery times, it is possible to plan the pickups and thus the provision of goods more precisely, which means that less space is required.

Packaging management

Packaging management also plays an important role here. Packaging costs are an often underestimated type of logistics cost. In this area, there is often a high diversity of variants, which in this form drive up packaging costs: On the one hand, the large number of different types means that more space than necessary is taken up by packaging materials. On the other hand, the procurement costs also increase and, in addition, fewer advantages can be exploited in purchasing due to higher purchase quantities of the same types of packaging.

Outgoing transports

Freight costs generally account for the second-largest share of logistics costs. Consequently, this cost block holds great potential for optimization. As former projects have shown, companies are often not aware of the amount of their freight costs or transport costs and do not conduct regular freight tenders. With successful transport cost management, we help our customers generate savings in the double-digit range. Determine the savings potential of your freight costs with our Freight-Check!

To our Freight Services

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We're looking forward to learn more about your company and the challenges you're facing or processes you'd like to improve. Contact us for an initial call.

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