how a manufacturing company should reduce production cost (3)

How a manufacturing company should reduce production cost

It’s true that we likely never stop searching for a better solution to reduce our production cost while basic rules and techniques have been not applied. We have listed out here several of them that manufacturing companies should make use of

how a manufacturing company should reduce production cost (3)

Process Optimization

Cost-cutting programs should always start with a thorough research and analysis on the entire manufacturing process. Such approach will give you a general view on your cost-consuming machines and then help you have a thorough insight to draw your own cost-cutting map in both directions – cutting waste and improving proficiency. It will be much easier for your to decide which stage should be cut out while which part of the process is working under its inherent potential.

For example, in a garment factory of a clothing manufacturer where LEAN manufacturing system has been applied, time, labor and machines are all optimized. The consecutive stages will be conducted by the proper machines arranged accordingly. That allows semi-products move one by one through stages. It also allows a good worker use more than one machine to conduct several consecutive stages. The number of worker per machine can be reduced. That minimizes the wasted time in waiting and moving between different stages too.

7 Action should be taken constantly for workforce streamlining

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Periodically check the status of your workforce optimization seems to be essential in this case. Basically, there are 2 groups of methods named minimize the scale of workforce while maximize their performance.

  • Enhance to proficiency of the workforce
  1. Place the right person at the right position
  2. Make sure that the performance of each person increases gradually
  3. Check if their demand of improving the capability has been met properly
  • Cutting waste of inefficient labor
  1. Balancing your workforce with the real labor demand is a great source of cost-saving
  2. Eliminate the percentage of idle labor in your workforce to cutting waste
  3. Change if your current workforce is not really suitable with your manufacturing system
  4. Replace inefficient labors by machines or technology if possible

Surprising gift from the minimization of energy consumption

In many factories, for example garment factories of a clothing manufacturer energy consumption always presents a majority part of manufacturing cost. If possible, sell your old machine and replace with a modern model which consumes less power. Running slower is also a good idea of saving energy in case that it’s not a sacrifice of customer’s interest. In many case of automatic production systems, it’s obvious that machines will be still running and consuming power when they are waiting for their turn in a programmed process. Rearrange and program them again can, therefore, save your money waisted in inefficiently energy used.
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Never underestimate the cost of inventory

A long period of inventory storage usually comes along with a bigger cost and risk. For example, a clothing manufacturer will face a very big risk of too much inventory if their product can no sell very well in each season. Fashion always change when a next season come and there seem to be no chance for a model to sell well when a season passes. Whenever applied, a nimble production will, therefore, always be able to help you minimize those cost & risk and a responsive manufacturing operation would be a very rewarding investment.

Above are 3 basic but very common measurements that should be taken in every manufacturing factories. and they are all gained from our own experience of more than 85 years working in textile manufacturing industry too. Hope that they also work well in your case and bring you a surprising about of benefit.

(Source: Thygesen Textile Vietnam)

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