Fastenal’s Post

Fun fact: Price does not always correlate with value. How is this possible? Total Cost of Ownership. Just because a pair of gloves costs $5 doesn't always mean it's value is worth $5. How do indirect costs influence your TCO? How can you reduce those costs? Take a look at this article. OR... reach out to me, and let's start saving your business big money!

Imagine this: A worker walks across the facility for gloves or a tool. No big deal, right? Now picture 300 workers doing this several times a day. That’s how 50,000 hours (or around $1,000,000 in production cost) can be lost annually. Enter Total Cost of Ownership Analysis (TCOA). By bringing in Lean experts, we can identify and eliminate non-value-added steps, transforming “business as usual” into “best-in-class.” Learn how understanding TCO can uncover hidden costs, boost efficiency, and increase agility. https://lnkd.in/gm3Qmb2K

What’s the real cost of fixing mistakes that shouldn’t happen in the first place?" Mistakes might feel like part of the process, but they’re costing businesses more than just labor. With Poka-Yoke, many errors can be eliminated entirely—saving time, materials, and throughput. Let’s break down the hidden costs: Imagine a company with 50 employees, where each worker encounters one simple mistake—like using the wrong part—once per shift. Each mistake takes 10 minutes to fix and results in material waste worth $10. Additionally, throughput is impacted, slowing the overall process. The True Cost of One Small Mistake: Labor Costs: ↳ Per shift: 10 minutes x 50 employees = 500 minutes (8.33 hours) lost. ↳ Per day: On a two-shift schedule, that’s 16.67 hours lost. ↳ Per week: 16.67 hours/day x 5 days = 83.35 hours. ↳ Per month: 333.4 hours. ↳ Per year: 4,000 hours x $25/hour = $100,000 annually in labor. Material Costs: ↳ Per shift: $10 material waste x 50 employees = $500. ↳ Per day: On a two-shift schedule, that’s $1,000 wasted daily. ↳ Per week: $1,000/day x 5 days = $5,000. ↳ Per month: $5,000/week x 4 weeks = $20,000. ↳ Per year: $20,000/month x 12 months = $240,000 annually in material waste. Throughput Loss: + If each mistake delays production by 10 minutes per employee, this reduces available time for productive work. For example: Daily throughput loss: 16.67 hours x average production output/hour. Over the year, this can result in thousands of units lost, depending on your process. Total Impact of Mistakes Per Year: ↳ Labor cost: $100,000 ↳ Material cost: $240,000 Throughput loss: Variable, but significant, depending on your production rate. ↳ Grand Total: At least $340,000 annually, just for one small mistake per worker per shift. Here’s how Poka-Yoke changes the game: Why Poka-Yoke Works: Prevention Over Correction: Stops errors before they happen, reducing labor, material waste, and downtime. ↳ Consistent Quality: Eliminates rework and ensures throughput isn’t disrupted by mistakes. ↳ Cost Efficiency: Saves both hard costs (materials and labor) and soft costs (lost throughput and customer dissatisfaction). ↳ Happier Teams: Reduces frustration for workers by creating reliable, mistake-proof processes. What’s the real cost of errors in your business? Poka-Yoke doesn’t just save time—it saves money, materials, and reputation. By designing error-proof systems, you’re protecting your bottom line while improving efficiency and quality. #LeanManufacturing #PokaYoke #MistakeProofing #ContinuousImprovement #QualityControl

𝙈𝙮 𝙛𝙚𝙬 𝙗𝙞𝙩𝙨 𝙤𝙣 𝙒𝙄𝙋 (𝙒𝙤𝙧𝙠 𝙞𝙣 𝙋𝙧𝙤𝙘𝙚𝙨𝙨) 𝙈𝙖𝙣𝙖𝙜𝙚𝙢𝙚𝙣𝙩 𝙞𝙣 𝙖 𝙥𝙧𝙤𝙘𝙚𝙨𝙨 𝙛𝙡𝙤𝙬 📦 Inventory for an accountant perspective can be an asset but in a perspective of Lean professional its an operational inefficiency - a waste so managing Work In Process (WIP) between workstations is crucial for maintaining efficiency and productivity. A well-managed WIP ensures a smooth flow of materials, reduces bottlenecks, and minimizes lead times. One of the most effective ways to control WIP is through the application of Time & Motion Study (TMS). 𝘏𝘦𝘳𝘦’𝘴 𝘩𝘰𝘸 𝘛𝘔𝘚 𝘤𝘢𝘯 𝘵𝘳𝘢𝘯𝘴𝘧𝘰𝘳𝘮 𝘞𝘐𝘗 𝘮𝘢𝘯𝘢𝘨𝘦𝘮𝘦𝘯𝘵 𝗕𝘆 𝗦𝘁𝗮𝗻𝗱𝗮𝗿𝗱 𝗪𝗼𝗿𝗸 𝗗𝗲𝗽𝗹𝗼𝘆𝗺𝗲𝗻𝘁 : This is deployed by maintaining 3 key elements in a work flow that are 𝗔) 𝗧𝗮𝗸𝘁 𝗧𝗶𝗺𝗲 🔹 The pace at which products must be completed to meet customer demand. 🔹Takt time is calculated by dividing the available production time by the customer demand. 𝗕) 𝗪𝗼𝗿𝗸 𝗦𝗲𝗾𝘂𝗲𝗻𝗰𝗲  🔹The specific order of operations that workers must follow to perform a task. 🔹Ensures tasks are completed in the most efficient and effective manner. 𝗖) 𝗦𝘁𝗮𝗻𝗱𝗮𝗿𝗱 𝗜𝗻𝘃𝗲𝗻𝘁𝗼𝗿𝘆 🔹The minimum amount of materials or parts needed to keep the process running smoothly. The TMS gives a consumption rate of upstream and downstream stations and can give an idea of maintaining minimum inventory by avoiding starve or blocked condition of any station. 🔹Prevents overproduction and excess inventory, aligning with Lean principles. #ProcessManagement #ManufacturingExcellence #TimeAndMotionStudy #WorkInProcess #OperationalEfficiency

Just finished the course “Cost Reduction Tips - How To Cut Costs And Maximize Profits” by Chris Croft Top 10 Things to Measure (and 10 Actions) to Cut Costs 💰 As they say, "you can't manage what you don't measure." 📏 When cutting costs, the first step is to understand where your money is going. 💸 This course outlines the 🔟 things to measure, and 🔟 actions to take. Measuring Your Costs 📊 1️⃣ Pareto Analysis 📊 Conduct a Pareto analysis to identify the top 20% of cost drivers that make up 80% of spend. Focus here for the biggest impact. 💰 2️⃣ Employee Productivity 👩💻 Measure output per employee, not just hours worked. Identify high and low performers. 3️⃣ Time Waste ⏱️ Measure time lost due to inefficiencies. This reveals opportunities to boost productivity. 4️⃣ "Hidden" Costs 💸 Track activities like meetings, IT support, and queues - they add hidden costs. 5️⃣ Resource Utilization 🏭 Measure utilization of expensive equipment, facilities, and personnel to optimize usage. 6️⃣ Subcontractor Costs 👷♂️ Subcontractors can be a hidden cost center - measure usage and value. 7️⃣ Pricing Effects 💰 Test pricing to find ways to increase prices without hurting demand. 8️⃣ Departmental Profitability 📈 Analyze each department's revenue generation, not just costs. 9️⃣ Investment Returns 💸 Measure the impact of investments to justify strategic spending. 🔟 Quality Failure Costs 🚫 Track the costs of poor quality, rework, lost business, etc. Taking Action 🔍 1️⃣ Measure First, Then Act 📏 Measure before and after to ensure desired results. 2️⃣ Focus on the Big Wins 💰 Concentrate on the top 20% of cost drivers. 3️⃣ Engage Employees 👥 Get input from all levels to drive engagement. 4️⃣ Strengthen HR 👨🔧 Ensure cost-cutting doesn't hurt morale. 5️⃣ Automate and Streamline 🤖 Use tech to optimize inefficient processes. 6️⃣ Renegotiate Contracts 📝 Use data to renegotiate with suppliers, vendors, customers. 7️⃣ Redeploy Resources 🔃 Shift underutilized resources to higher-value activities. 8️⃣ Invest Strategically 💹 Invest in areas that drive long-term efficiency. 9️⃣ Improve Quality 🔧 Use failure cost data to justify quality investments. 🔟 Monitor and Iterate 🔁 Continuously measure and refine your approach. This data-driven approach can drive sustainable cost savings without compromising your organization's long-term health and performance. 🏆 Check it out: https://lnkd.in/dAnd7uaA #costcontrol.

🚨 𝐀𝐫𝐞 𝐘𝐨𝐮 𝐒𝐭𝐫𝐮𝐠𝐠𝐥𝐢𝐧𝐠 𝐰𝐢𝐭𝐡 𝐈𝐧𝐯𝐞𝐧𝐭𝐨𝐫𝐲 𝐌𝐚𝐧𝐚𝐠𝐞𝐦𝐞𝐧𝐭? Many companies face significant challenges in managing their inventory effectively, leading to unnecessary costs and inefficiencies. Common issues include: 🔍 𝑲𝒆𝒚 𝑷𝒓𝒐𝒃𝒍𝒆𝒎𝒔: 🔸 𝐈𝐝𝐞𝐧𝐭𝐢𝐟𝐲𝐢𝐧𝐠 & 𝐑𝐞𝐦𝐨𝐯𝐢𝐧𝐠 𝐃𝐮𝐩𝐥𝐢𝐜𝐚𝐭𝐞𝐬: Most practitioners struggle with this. 🔸 𝐂𝐨𝐧𝐯𝐞𝐫𝐭𝐢𝐧𝐠 𝐟𝐫𝐨𝐦 𝐎𝐄𝐌 𝐭𝐨 𝐎𝐏𝐌 𝐨𝐫 𝐀𝐏𝐌 𝐒𝐮𝐩𝐩𝐥𝐢𝐞𝐫𝐬: This switch can yield significant savings. 🔸 𝐎𝐩𝐭𝐢𝐦𝐢𝐳𝐢𝐧𝐠 𝐒𝐭𝐨𝐜𝐤 𝐋𝐞𝐯𝐞𝐥𝐬 & 𝐑𝐞𝐩𝐥𝐞𝐧𝐢𝐬𝐡𝐦𝐞𝐧𝐭 𝐒𝐭𝐫𝐚𝐭𝐞𝐠𝐢𝐞𝐬: Essential for maintaining efficiency. 🔸 Reducing Stocking Locations: Where appropriate, to cut costs. 💡 𝑶𝒖𝒓 𝑺𝒐𝒍𝒖𝒕𝒊𝒐𝒏: Join our 3-day workshop in KL this September, titled "𝐌𝐑𝐎 𝐒𝐩𝐚𝐫𝐞𝐬 - 𝐎𝐩𝐭𝐢𝐦𝐢𝐳𝐞 𝐒𝐭𝐨𝐜𝐤 𝐋𝐞𝐯𝐞𝐥𝐬, 𝐚𝐧𝐝 𝐑𝐞𝐝𝐮𝐜𝐞 𝐈𝐧𝐯𝐞𝐧𝐭𝐨𝐫𝐲 𝐂𝐨𝐬𝐭𝐬." This practical, newly structured workshop includes: 🔹 In-depth case studies 🔹 Advanced software tools 🔹 Hands-on exercises These techniques will enable you to apply solutions immediately in your organization, leading to substantial cost reductions. 𝐈𝐟 𝐲𝐨𝐮 𝐰𝐚𝐧𝐭 𝐭𝐨 𝐥𝐞𝐚𝐫𝐧 𝐦𝐨𝐫𝐞, 𝐜𝐥𝐢𝐜𝐤 𝐭𝐡𝐢𝐬 𝐥𝐢𝐧𝐤 https://lnkd.in/gB9a6cKm. #InventoryManagement #MROSpares #StockOptimization #CostReduction #DataCleansing #DuplicateStock #OEMtoOPM #ReplenishmentStrategy #StockReduction #OperationalEfficiency #SupplyChainManagement #AssetManagement #WarehouseManagement #ProfessionalTraining #KLTraining #BusinessEfficiency

Is your manufacturing business constantly changing plans, chasing orders, and struggling with inefficiency? Our experience shows that even the most volatile operations can benefit from a Fixed Repeatable Schedule (FRS). It’s not about restricting flexibility, it’s about formalising the most efficient sequence of production while agreeing on clear rules and boundaries for when and how the plan can change. Discipline in a word! At Chasm, we help planners go from unsung heroes to key players in driving efficiency. Read more about how a #FRS can work for your operation with this short article written by our own Head of IT (and planner in a previous life) Aaron Murin-Heath. #wefixfactories #fixedrepeatableschedule #fixyourfactory #planningandscheduling

Stop spinning your wheels and start driving results! Our blog unpacks the power of process improvement planning – it’s the secret sauce to staying ahead today. https://hubs.li/Q02xNMkM0

Driving Financial Success through TPM: Cost Savings and ROI Total Productive Maintenance (TPM) is more than just a methodology—it’s a financial game-changer. By systematically improving equipment reliability, optimizing processes, and empowering teams, organizations can unlock substantial cost savings and achieve impressive ROI. Here’s how TPM delivers financial impact: 1.Reduced Downtime: Unplanned equipment failures are costly. TPM reduces downtime through proactive maintenance, translating to increased productivity and significant cost avoidance. 2.Lower Maintenance Costs: Shifting from reactive to preventive and predictive maintenance minimizes emergency repairs and extends equipment life, reducing capital expenditures. 3.Improved Quality: Stable equipment performance leads to consistent product quality, minimizing waste and rework costs. 4.Energy Efficiency: Properly maintained equipment consumes less energy, contributing to operational savings and sustainability goals. 5.Increased Output: Reliable machinery enables higher throughput with the same resources, enhancing revenue potential. ROI Spotlight: Organizations that implement TPM often achieve ROI within months to a few years. For example, an automotive parts manufacturer I worked with reduced downtime by 30% and cut maintenance costs by 20%, resulting in an ROI of 150% within the first year. TPM isn't just about maintenance; it’s a strategy for operational excellence and financial success. The true power of TPM lies in aligning technical improvements with organizational goals to create a resilient and cost-effective manufacturing system. #Manufacturing #TPM #LeanManufacturing #CostSavings #ROI #OperationalExcellence

Run Rate: Monitoring Your Processes for Optimal Performance https://lnkd.in/eyxYMeU7 #LEAN #ContinuousImprovement #SixSigma