Cost Cutting Tips for Manufacturers
Posted July 23, 2013 & filed under Job Search, References
It’s the end all question of a manufacturers existence: how to cut costs without reducing the quality of products. And after production costs have been reduced it’s on to the next task: how to cut more costs while still maintaining product quality.
Recently, Lean manufacturing, Overall Equipment Effectiveness (OEE), and Six Sigma have been the go-to methodologies for manufacturing facilities to cut costs, resources, and time without killing the quality of their end products. But are there any ways to increase cost cutting measures after you have implemented new methodologies?
The following are 10 cost cutting tips for manufacturers to reduce their facility costs without drastically changing everyday operations:
1) Properly seal HVAC ducts
The amount of hot and cold air wasted during bouts of extreme temperatures can add up to staggering costs for manufacturers. Investing in sealing off HVAC ducts can lead to big saving during the summer and winter months.
2) Paint the rooftop white
It may seem like an arbitrary bit of advice at first, but if you are one of the many manufacturing facilities that has a black rooftop you are wasting money on increased cooling methods. Having a black rooftop increases the internal temperature of buildings (due to direct sunlight and the color black’s retention of heat), making them harder to cool. When combined with tip #1, this can save you big bucks each year.
3) Invest in a baler
What is your method of eliminating cardboard waste? If you are still disposing of it in a dumpster, resulting in numerous hauling costs, you could be investing that money in a baler. By utilizing baler pick up routes you will eliminate haul charges and payoff this investment in no time.
4) Build a water reservoir
All that rain water that pours down on manufacturing facilities doesn’t have to go to waste. Instead, building a water reservoir will contain it for later use, reducing the costs of your water consumption. Collected water can be used to clean facilities or pumped into eye washes and chemical showers in case of an emergency.
5) Install solar panels
The benefits of solar panels are as clear as day. Although they are a costly investment, the benefits of photovoltaic cells eventually wipe away their installation costs and then some. Government tax breaks and reduced heating and electric costs beat out piles of unpaid utility bills any day.
6) Evaluate facility space
Are you efficiently utilizing the space of your facility to the best of your ability? Try cutting down on and consolidating unused space, which could then be sublet for a bit of extra revenue at no cost to your operations.
7) Use SaaS solutions
If you own multiple facilities, each equipped with several computer terminals, you are probably spending a bundle on software packages and licenses. By implementing SaaS solutions hosted on the cloud you can link multiple terminals at every facility under a single software license.
8) Monitor your energy consumption
Where and at what time of day does your facility consume the most amount of energy? You can monitor your consumption of utility services by employing software systems that link your equipment to a central server. With some careful analysis of peak energy times you will be able to shut down underused devices and cut corners without cutting production.
9) Retaining top talent
Employees are one of the most important factors in cutting costs, which is why retaining top talent is an important step in saving money. Long term highly skilled workers not only eliminate burdensome training costs but often work more efficiently than new hires.
10) Reward systems
Finally, rewarding employees for cutting costs through innovation and efficiency will encourage them to get creative in their everyday tasks. These rewards can be anything from cash bonuses to time off.
By Kevin Withers
