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Manufacturing Cost Reduction

About the Client

In today’s highly competitive market, In which Cost of inputs are increasing rapidly, While Customers are reducing target prices day by day. It became evident that only cost effective Supply Chain can be a fittest to survive .Major Player in Garment industry was looking for manufacturing cost reduction techniques to maximize its profit. For this, clientengagedWazir to advise for reducing the cost of its manufacturing facility, for which Wazir analysed points such as raw material procurement, logistic inbound and outbound, warehouse and stores, manufacturing process and wastages, energy fuel and water, Information management, finance, human resource, sales and marketing.

Core objective of the study was to devise a corporate strategy for the client covering the following aspects regarding manufacturing cost reduction techniques,

Project Objectives

Core objectives of the Sourcing Strategy study was to cover-up the following aspects:

  1. Raw material procurement – Bulk buying, opportunity buying, partnership with vendors, E-procurement, buying from tax exempted areas, removing intermediates, EOQ etc
  2. Logistic inbound and outbound – Map routing, In transit damages, load ability, annual rate contract for transportation etc
  3. Warehouse and storage – Space, FIFO, Low inventory.
  4. Best in trade Men and Machine ratio for the product , with less indirects
  5. Productivity – Efficient utilization, less or no wastages in production process.
  6. Manufacturing process and wastages – Changeover control, multiskilling of operators, MinimumWIP , No buffer , Planned Buffer etc..
  7. Energy, Fuel and water – power utilization, fuel utilization control, water requirement and efficient use etc.
  8. Information Management – Easy and fast MIS system in organizations.
  9. HR modules – Absenteeism control, skilled labor recruitment and retention, low or zero attrition rate.
Deliverables
  1. We delivered the manufacturing cost reduction report covering the stated objectives.
  2. We submitted a manufacturing cost reductionstudy report covering:
    • Raw material procurement report with targets
    • Logistic inbound and outbound control report
    • Warehouse storage plan
    • Manufacturing and production process losses in terms of Value wastes , Productivity losses , etc..
    • Energy fuel and water consumptions and targets
    • HR reports
    • MIS report on all Supply chain results in terms of volume & Value
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