Scrap Drum Solution Saves Foundry $30,466 Annually
Challenge
A foundry was facing production delays due to inconsistent availability of scrap material drums, and they were also paying premium prices for these drums.
Solution
The customer reached out to Martin Integrated Supply for help managing the drum supply. Although this task was outside the typical stockroom scope, Martin worked closely with the workers using the drums to determine the optimal quantity needed. They also opened the drum supply for bidding, allowing multiple vendors to quote prices for sale, delivery, and pick-up. Once a supplier was selected, a blanket PO was issued for 50 drums to be delivered every two weeks.
Results
The new process eliminated stock-outs, and the machine shop now has a reliable process for ordering extra drums when needed. Over eight months, the supply has remained consistent, preventing further production delays. Additionally, Martin secured a $22 savings per drum, leading to a total annual savings of $30,466 for the customer.
Key Takeaways
Consistent Supply and Improved Efficiency: By establishing a reliable drum supply process, Martin eliminated stock-outs, preventing production delays and ensuring continuous availability of scrap material drums.
Cost Savings Through Vendor Bidding: Opening the drum supply to competitive bidding reduced the price per drum by $22, resulting in an annual savings of $30,466 for the foundry.
Proactive Supply Management: Martin’s collaboration with workers and the blanket PO system provided a scalable, efficient approach for managing drum supply, allowing for extra orders when needed and supporting smoother production operations.