planned and unplanned presentation (1)
TRANSCRIPT
Get Out From Under Your OverheadEfficiency, Simplicity and
Consolidate
Reducing Timeand
Lowering Total Cost in the Business Supplies Procurement Process
Reduce Overhead by Minimizing Purchases Orders
In an increasingly competitive global environment, organizations must innovate to find opportunities to improve their productivity and reduce total cost.
Initiatives that consider all aspects of process improvement and purchase order reduction will find the greatest level of success in improving efficiency.
AMERICAN’S SOLUTION
More Than A Business Solution. Your Partner.
AMERICAN INK SOLUTIONS INC.
AMERICAN MAILING SOLUTIONS INC.AMERICAN PRINTING SOLUTIONS INC.
AMERICAN SHIPPING SOLUTIONS INC.
Direct and Indirect Materials used to support the…
What is ORAD?
…of activities in a business enterprise.
Origination
Replication
Administration
Distribution
Controlling the Flow of Communication
Recognizing Indirect Materials (ORAD) purchase behaviorsand the cost of the Planned and Unplanned
Strategies for Saving –
– Supplier Consolidation– Product Standardization– Inventory Reduction / Workplace Organization
Discussion Topics
Cross Referencing
You Face Many Challenges Daily…
Technical Support
Production Line Issues
Repair PartsEmployee Satisfaction
Cash FlowFreight Ordering
ProductivityImprovements
Budget Cuts
Hard to Find Item
Inventory Level
Supplier out of Stock
Inventory
Delivery TimesAvailability
Most Unplanned Purchases Are Non-Routine
Less Than 5 Times Per Year: A search every time you purchase
Research Results
80%
60%
40%
20%
0%
100%
Unique itemspurchased Year 1
Items repurchasedin Year 2
% of unique items
70-75% Of Unplanned Purchases Are Unique, One-Time Purchases
Process Costs Can Be More Than Price of Product
The Opportunity For Savings Is In The Process
$117 $100100%
80%
60%
40%
20%
0%
Process Cost
Process Costs$100
Inventory
Selection and ordering
Receipt and payment
Price of Product$17
Meeting Unplanned Needs Can be a Long and Costly Process
Managing a crowded supply chain is expensive
All ORADpurchases
All Suppliers
Maximize E-channels
CONTINUUM• Complex, fast-changing environment• Adoption is difficult• Engage different e-channels: one size does not fit
all purchasing situations
INTEGRATEDERP SYSTEM
ELECTRONICMARKETPLACE
EDI INTERNET
FIELDNAMES:SupplierID Supplier PartID ItemDescription UN/SPSCCode UnitPrice
005103494-t 1AH87 "RatchetAdapterFor3/8InchDrive1-5/16InchesLength" 27111700 0.00005103494-t 1AM25 "PushbuttonRoundHeadRatchetFor1/2InchDriveChrome16InchesLength" 27111700 0.00005103494-t 1AN88 "StandardSocket6Point1Inch1-9/16InchLength" 27111700 0.00005103494-t 1APC4 "AdjustableHookSpannerWrench3/4InchTo2InchDiameterCapacity6-3/8InchLength" 27111700 0.00005103494-t 1ARX6 "Workmaster&174;Wall ScraperHardwoodHandle3InchFlexibleBlade" 27111500 0.00005103494-t 1ATC0 "Professional&153;PuttyKnifeNylonHandle1-1/2InchStiff Blade" 27112600 0.00005103494-t 1ATC1 "Professional&153;PuttyKnifeNylonHandle1-1/2InchFlexibleBlade" 27112600 0.00005103494-t 1A033 "HidLampBallast HighPressureSodium60Hertz-40DegFOr-40DegCMinimumStartingTemperature1-3/4Inche 39111800 0.00005103494-t 1A375 "LaminatedSteel Padlock1MasterlockModel KeyedDifferent1-3/4InchX7/8InchBodySize" 46171500 0.00005103494-t 1A376 "LaminatedSteel Padlock3MasterlockModel KeyedDifferent1-1/2InchX3/4InchBodySize" 46171500 0.00005103494-t 1A693 "TimeDelayFuseFrn-RSeries250VoltsAc125VoltsDc10Amps" 30212000 0.00005103494-t 1A695 "TimeDelayFuseFrn-RSeries250VoltsAc125VoltsDc15Amps" 30212000 0.00005103494-t 1A697 "TimeDelayFuseFrn-RSeries250VoltsAc125VoltsDc25Amps" 30212000 0.00005103494-t 1A698 "TimeDelayFuseFrn-RSeries250VoltsAc125VoltsDc30Amps" 30212000 0.00005103494-t 1A703 "TimeDelayFuseFrs-RSeries600VoltsAc300VoltsDc15Amps" 30212000 0.00005103494-t 1A823 "Curvette&174;SwitchOn/Off RedPopUpWithOn-Off SinglePoleSingleThrow2Connections0.47InchX1.07Inch 30211900 0.00005103494-t 1A839 "HardwoodHandleWithThreadedHardwoodTipForBrushes15/16Inch" 47131600 0.00005103494-t 1A843 "Un-FlaggedBlackTampicoFloorBrushForMediumGeneralPurposeSweepingApplications 24Inches" 47131600 0.00005103494-t 1A868 "StandardCableTie7.5InchLengthBlack500PerPackage" 30212100 0.00005103494-t 1A949 "Medical PowerBarNoSwitch/PilotLightWhiteHousing4Outlets6FeetCord9-7/8InchesX2InchesX1-3/4Inches 30211700 0.00005103494-t 1CF46 "Ultra-Wipe&153;WhiteMediumDutyWiper13InchesX13Inches50PerBag16BagsPerCase" 47131500 0.00
• Visibility to purchase data across locations
• Universal pricing• Ease of migration from Internet to
procurement software
Vendor Consolidation Benefits
Supplier Selection Considerations
• Experience• Product Breadth and Availability• Resources• Technology• Measurable Results• Continuous Improvement Focus• Win-Win Relationship
Steps to Vendor Consolidation
• Review impact of consolidating critical commodities
• Suppliers become key partners• Share goals• Harness resources company-wide• Scheduled supplier reviews
Product Standardization
Benefits of Product Standardization
• Increases volume discount due to leveraged buy
• Greater control of purchasing• Reduces inventory• Reduces training• Increases compliance
Inventory Reduction / Organization
Studies Show That 70-75%Of Unplanned PurchasesAre Unique, One-TimePurchases
Lack of organization in work area creates clutter and limits work space.
Too much time is spentlooking for and replenishing supplies that are neededfrequently
Inventory Reduction / Organization
Effective workplace organizationsimplifies your environment, reduceswaste and non-value activity, whileimproving quality and safety.
This process can increase morale,create positive impressions oncustomers, and increase efficiency.
Not only will employees feel betterabout where they work, the effect oncontinuous improvement can lead toless waste, higher quality andimproved work cycle times
Inventory Reduction Benefits
• Just-in-time purchasing• Free up your space and capital• Increase internal efficiencies• Focus on your core business• Cost of money
Consolidate!
Suppliers
Products
Inventory
Get Started Saving Time And Money!
c:: Determine who is responsible for planned and unplannedORAD purchases
c:: Document the purchasing & sourcing process
c:: Identify planned vs. unplanned items and categories
c:: Quantify current spend and potential to consolidate
c:: Determine on-hand inventory values, locations, etc.
c:: Assess condition of product information data and identify potential technology solutions
Thank You!