Optimization Strategy

Context

The project was developed for an American company that operates in Europe from 2 plants, one of them in Spain, from which most of Europe and the USA are served.

The perimeter of the project included all the secondary packaging: 4.4 million euros in boxes, with a total of 198 references, plus returnable pallets, strips, film and seal.

The first challenge was to agree on the functionality of the box: in marketing it was considered a tool to achieve push sales, in warehouses it was considered a way to provide support and resistance to palletizing. The consensus was obtained with a rather logistical definition: product transport unit.

The project has been carried out by Ahead until its full operational implementation, 100% successful.

Project:

The company had increased spending on corrugated cardboard in the last 3 years, where 80% of spending corresponded to 21% of total references, with a concentration of 90% in one supplier.

Opportunities were identified throughout the distribution and product management process, as well as by analyzing the supplier market. The following is a description of the actions grouped according to type of action and the savings obtained:

Concrete examples:

1. Standardization:

We identify boxes with margins up to 2 centimeters high without product, standardized to cover the maximum heights of similar products. When investigating the reason, we were able to verify that the folding of the product followed different parameters according to the production shift. A lack of homogeneity in the production process generated the same products with different sizes, artificially increased the primary packaging references and caused problems in the resistance of the boxes. The gap of up to 2 cm caused deformations and demands for product replacement.

Box in the production line, with 2 cm from the top of the product pile to the flap. More product or less cardboard?

Deformation due to the gap. Poor presentation of the packaging.

2. Redesign of the pallet:

Once the primary and secondary packaging had been optimized, Ahead proposed redefining the distribution of the boxes on the pallet to eliminate gaps in palletizing, gaps estimated at an average of 4.8% of the volume transported.

Results:

1. Standardization:

Savings of 85% were obtained:

  • less primary packaging surface
  • reduction of the size of the boxes

In total, the subset of shares obtained a total saving of more than 350 thousand euros.

2. Redesign of the palletization:

The product load on the pallet and truck was maximized, with a consequent total saving of between 140 thousand euros in a conservative scenario.

Analytics and consulting with concrete results

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