Many companies who use bar code technology are still plagued with excessive writing and/or data entry. This happens when many different types of information must be captured for each item during receiving and supplying vendors only bar code item numbers and/or descriptions and no other fields, or there are numerous potential next steps in the receiving process and they must be identified on the fly. These situations can occur whether for new receipts or returns.

Application 1: a

… Continue

Supply Chain Experts motto is that you are only as good as your weakest link, weak supply chain links have cost Boeing, the worlds largest airline manufacturer, billions of dollars and caused years of delays in their Dreamliner program. Today, as Boeing's new 787 Dreamliner program is progressing toward its first delivery, the jet maker is still working to repair its weak supply-chain links.

At the same time, overall jet sales for the year are way down. As of May 2009 the Boeing web site report… Continue

http://www.scholzandassociates.com/blog/2009/10/how-have-things-changed.aspx

Under some circumstances it is the seller not the buyer who has the advantage in a buy/sell relationship, (seller has a monopoly, resources to make products are always in short supply, demand fluctuates causing temporary short supply, etc.) The largest customers, oldest customers or those with personal relationships with the vendor usually get favorable treatment potentially hurting your competitive position.

When in a poor power position there are several things one can do to gain the favor of… Continue

Is a disconnect between purchasing and accounting impacting your supply chain scorecard?

One of the easiest ways to damage a buyer/seller relationship and not even know it’s happening is to toss an invoice over the wall to accounting and assume terms will be met. Payment terms are oftentimes stretched to preserve short-term cash reserves; sometimes breach of contract occurs beca

… Continue

To “Make” or “Buy”?

This subject is haunting many firms these days. Outsourcing problems include: Lack of flexibility, competing for (far away) resources, protecting proprietary information, challenges with different measurement systems, association with questionable business practices, lack of visibility into external environment factors at point of production, cost of freight, potential loss of competen

… Continue

Most companies that we visit have to cope with determining which products to stock to keep their customers happy and what would happen to both their competitive position and profits if they did not stock all items their customers could possibly want. What we often see when we visit those companies is distribution centers in which over 50% of their space is filled with products that sell poorly and overstock on most of those products as well.

We can calculate the cost of the extra warehouse spac… Continue

When most companies prepare their growth plans, the plan is conceived by the marketing staff or company ownership without consulting with the operational staff or determining the company’s operational capabilities. The growth plan is memorialized and goals are set. It was not determined if and how well those goals can be achieved, or what resources are required vs. those available to be able to achieve them. The plan usually is a percentage number and does not consider contingencies for better o… Continue

If you are buying a business it is important to benchmark key variables to determine the true value of the business. These include inventory, space, equipment, staff, and technology.

Inventory typically includes slow moving items and overstock which adds to space, staff, and equipment costs and reduces productivity. The real value of the inventory is that of the faster selling items in proper quantities.

Space is usually valued by the cost of the property or of the lease. Space also should be… Continue

When moving a distribution or manufacturing center to a new location, one can significantly reduce costs. The less “stuff” moved, the lower the total cost will be. Ideally, one will sell and ship as many units as possible from the old facility so that product will not have to be moved. It may even pay to have a “pre-move sale” especially for most costly items to move such as heavy items or those requiring special handling during the move. As you get closer to the move date you will therefore wan… Continue