Manufacturers are
always looking for techniques to reduce their cost. Here are five of them that
will help the manufacturers reduce cost irrespective of their sector.
The primary step would
be to assess their process and do on internal audit. Only when the big picture
is at view, methods can be implemented to reduce the costs.
Cost
reduction in Production Process
Energy
Efficiency
Most of the time
without our notice we tend to waste a lot of electricity. Implementing sensors
that would stop the machines immediately after usage can reduce quite a lot of
cost. Replacing energy guzzling machinery with those consuming less energy can
save up to 10% of the cost. Usage of alternative energy sources like solar energy
which is the cheapest source of energy can cut down operating cost
significantly.
Fixed
Cost Reduction
Machinery for a
manufacturing industry is very important, but only a few machinery are constantly used. Hence, owning the machinery that is used passively wouldn't be
feasible; renting/leasing such machinery can reduce the fixed cost. Using
automation in production process can decrease the labor cost abundantly. Outsourcing
advertising, marketing and sales could also help in cost reduction.
Overhead
Cost Reduction
Maintaining inventory
by not over producing and recycling/selling the wastage or scrap of the raw
material can always free up and manage the factory space and reduce wastage. At
times, outsourcing supply can reduce the business space, risk, staff,
maintenance of vehicles. Buying raw materials at bulk and sharing it with
another manufacturer can reduce the material and inventory space. Intercom and
internet calling, conferencing and video calling meetings can help reduce
administrative cost.
Reduction
in Labour Costs
Usage of technology for
the manufacturing process like implementing sensors and automation, robotics
can drop down as the number of labors drops as the automation requires less
human interference and is more accurate. Using part time workers and free
lancers can eliminate the idle time of laborers. Implementing methods to
increase efficiency; comfortable positive workplace, eliminating overtime as it
reduces efficiency, training employees, getting to know the employees, re-skilling of the employees rather than assigning them monotonous task can help
the manufacturer make optimum use of the labor force.
Customer Related Cost Reduction
Technology can help the
manufacturer cut down the cost in every stage of the manufacturing process and
also at marketing. Using technology for marketing, advertising and promoting of
goods can reduce cost abundantly. Designing products digitally 3D print of the
product would help the manufacturer in better understanding of customer needs and
can reduce correction and reproduction.
To know how Industries have used SolutionBuggy to implement cost reduction process with help from industry experts login to SolutionBuggy
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