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Roy Strauss

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Incentive Systems – Can Make or Break Your Company

A properly designed and implemented employee incentive system is an excellent tool for optimizing employee productivity, improving facility throughput, and reducing staffing costs, but when done improperly can disrupt one’s business and have a negative impact on the business for a very long time. Keys to success include: proper communication; planning; benchmarking; fairness; anticipating and being prepared for objections; flexibility; and being able to resolve any disputes that occur. It is ess… Continue

Added by Roy Strauss on December 11, 2009 at 6:19pm — No Comments

Cycle Counting, Not Just For Inventory Accuracy and Security

Cycle counting in addition to improving inventory accuracy is also an excellent management tool for products of special interest, with specific characteristics, or for many different circumstances such as:

- Fast moving products or products in short supply that may require rationing or to be set aside for one’s best customers

- Products that are easily resold or have had previous inventory shrinkage

- Products that look similar to others or that can easily be mixed togeth

… Continue

Added by Roy Strauss on December 4, 2009 at 2:17pm — No Comments

Cross Docking To Save Time and Money

Cross docking is an excellent way to save money for warehousing and distribution companies when time is of the essence or the timing is just right. It allows items for customer orders to be transported from the receiving dock to the shipping dock door, the cross-docked product either to be shipped alone or added to an existing order. The key is that the product never leaves the dock area saving the time of transporting the receipt from the dock to the storage location and then picking the pro

… Continue

Added by Roy Strauss on November 17, 2009 at 11:02am — No Comments

Two Excellent Applications for Voice Recognition

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 (reverse logistics).

… Continue

Added by Roy Strauss on November 5, 2009 at 5:00pm — No Comments

Purchasing From a Poor Power Position

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

Added by Roy Strauss on October 12, 2009 at 6:00pm — No Comments

Product Mix vs. Customer Service vs. Profitability

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

Added by Roy Strauss on September 23, 2009 at 4:46pm — No Comments

Operational Vs. Marketing Growth Plans

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

Added by Roy Strauss on September 23, 2009 at 4:42pm — No Comments

Buying a Supply Chain Business

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

Added by Roy Strauss on September 23, 2009 at 4:19pm — No Comments

Lowering the Cost of Moving

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

Added by Roy Strauss on September 23, 2009 at 4:12pm — No Comments

Outsourcing Overseas, Do You Have Plan B?

We now know of many companies who have chosen to have their manufacturing done in Asia or South America who have been very disappointed by the results. Experiences include: the sample was perfect but the goods received were below standard; they were sure they could get it done in time (but they couldn’t); the chemical formulation was “almost” right; they were sorry but a huge order came in for their best customer so yours had to wait; we’re experiencing charge backs from customers because our la… Continue

Added by Roy Strauss on September 22, 2009 at 11:11am — 1 Comment

What Is The Optimal Ceiling Height For Your Operation?

Choosing the right ceiling height for a warehousing or manufacturing operation can have a significant impact on both short and long term costs. When initially comparing rents or the purchase price of a building, taller buildings with similar costs and square feet usually are a better bargain, but to determine the best option when comparing buildings with varying heights, foot prints and costs, both growth requirements and the type of business must be taken into consi… Continue

Added by Roy Strauss on September 22, 2009 at 11:03am — No Comments

Information Technology (IT) Gap Analysis

In the current age of technology it is very important to have the proper software and associated hardware to meet all business requirements. This software could include: ERP (Enterprise Resource Planning); WMS (Warehouse Management Systems); MRP (Material Requirements Planning); TMS (Transportation Management Systems); GTM (Global Trade Management); and other supply chain and operations management software. A gap analysis is performed to determine if and/or when current software should be modif… Continue

Added by Roy Strauss on September 22, 2009 at 10:57am — No Comments

Good Data = Good Profits

Very often when we begin a consulting project and we request key data required for project success, we’re told the data is not available, can we do the project without it? Reasons include: the data is in the system somewhere; corporate won’t allow us access to it; some of the data is in ERP, some in WMS, and some in other software; we haven’t the tools to extract it, etc. We know then that the company is not being run properly because the data we need to do the project is the data that should h… Continue

Added by Roy Strauss on September 22, 2009 at 10:55am — No Comments

How to Choose the Correct Warehouse Management Software (WMS)

There are now so many WMS packages presently available that one could literally spend years seeking out, reviewing, and then selecting the best solution. Keys to selecting the correct WMS package include: - Understanding your business’s operational requirements - Determining how future growth will impact business requirements both vertically and horizontally - Defining all needs both for present operations and any and all potential future requirements for your business, e.g.: • New and/or di… Continue

Added by Roy Strauss on September 22, 2009 at 10:52am — No Comments

The Real Costs of Excess Inventory and Poor Product Mix

Many companies stock numerous products that haven’t sold in a long time and have no hope of selling, without understanding the true costs and consequences. Plans are also in place for proper inventory stocking levels but many companies cannot stick to the plan (there are numerous reasons, too many to list here) and therefore store excess inventory in addition to non-saleable products. Often dead items and overstock account for 25% to 50% or more of total inventory and of storage space as well.… Continue

Added by Roy Strauss on September 22, 2009 at 10:46am — No Comments

New Products, Excess Inventory, and Other Controllable Problems

In company after company we’ve worked with over the years we’ve encountered numerous problems created by a lack of awareness between activities in the office and the resulting problems in the distribution or manufacturing center. Results have included poorer performance, increased operational costs and lower levels of customer service. Typical examples include:

1. New items being ordered and the DC/MC not being aware of their anticipated arrival and/or not having the information requir

… Continue

Added by Roy Strauss on September 14, 2009 at 6:34pm — No Comments

Contingency Based Planning

Company after company designs there new operation or determines how they will grow the operation based on a single number growth plan. In previous writings we’ve pointed out that all too often the growth plan is a marketing growth plan not an operational growth plan (which often will result in failure) but just as important is not planning for contingencies.

If a company determines they will grow 10% a year for 5 years that will be the number. What happens though when they have unexpec

… Continue

Added by Roy Strauss on September 4, 2009 at 11:30am — No Comments

The Real Importance of Selecting the Right Facility

As Supply Chain experts we often get calls from potential clients stating that they just leased or purchased new distribution and/or manufacturing space and need our assistance in designing their new operation. This is very disappointing as the building is part of the tool and is just as important in driving efficiency and reducing costs as process, equipment, and staff. Building size and shape, dock size and placement, column spacing, and ceiling heights not only will have a major impact on

… Continue

Added by Roy Strauss on September 1, 2009 at 6:05pm — No Comments

Slotting: Improve Warehousing Operations, Reduce Costs

Slotting is the strategic assignment of product to warehouse locations to improve operations and reduce costs. The goal is to assign locations in warehouse zones, within technologies, in location types, by product characteristics, or other requirements unique to a business, so product is stored, picked, replenished, and handled in the most efficient way optimizing facility throughput. First, zones must be assigned within a facility to gain strategic advantage, sequencing and proximity to the do… Continue

Added by Roy Strauss on June 22, 2009 at 11:00am — No Comments

Have You Ignored Your Responsibility to Manage Your Warehouse?

Well run profitable companies typically have top management determining company policies and then leading the effort to make sure that they are implemented. We are seeing more and more instances in which many levels of management are overlooking their obligation to manage, especially the warehousing component. Emphasis is typically put on strategic planning, marketing, sales, finance and information technology and warehousing operations drop to the wayside. It is the operations part of the busi… Continue

Added by Roy Strauss on June 5, 2009 at 2:38pm — No Comments

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