6 Easy Steps to Reduce Supply Chain Waste
While most logistics firms have implemented a comprehensive waste and recycling program, significant cost saving opportunities still exist. By analyzing the supply chain, additional savings can be found by identifying where waste is occurring and then working on how it can be designed out of the process.
With companies now often measured on their environmental performance as well as their financial capabilities, it’s more important than ever to make sure that your waste management operations are as sustainable as they can possibly be. In this article, we look at the six steps you can take to reduce supply chain waste and make a real impact on your business.
1. Engage Your Customers
While it might seem like the end of the process, rather than the beginning, any waste elimination effort must not diminish your customer’s satisfaction. It’s important to engage your customers from the start and get them involved in your process improvement initiative to help ensure they have a positive experience.
Customers can be a valuable source of inspiration for process improvement whether it be through direct feedback or through customer surveys that can provide direct competitor comparisons for valuable market insight.
2. Review Operations for Unnecessary Procedures
Your own workforce will be able to provide valuable feedback into wasteful practices within your internal operations. Employees can be asked to assess the efficiency of each part of the supply chain, or highlight areas of concern. Practices can then be prioritized by how wasteful they are and by the ROI that can be achieved by implementing the change.
3. Review Delivery Procedures
When looked at individually, a broken pallet or a bulk delivery wrapped in excessive packaging may look to be incidental to operational costs. However, when these issues are multiplied over the entire operation and the course of time, these wastes can easily run into five figure annual expenses. Excessive packaging costs your operations twice, since it takes staff longer to break the goods apart, as well as increasing your disposal costs.
Key areas for review include pallet loss and breakage, ratio of defective parts, and time and waste materials generated breaking down bulk deliveries.
4. Involve Your Suppliers
Suppliers should also be very keen to assist in your supply chain waste review, since it often will lead to an increase in business for them if they can successfully resolve your issues.
Common areas that you can discuss with suppliers to reduce product waste are:
- Ratio of defective parts
- Recyclability, weight and volume of packaging materials
- Packaging take-back options
- Bulk order and packaging quantities, to reduce the need to dismantle and repackage product
5. Review Returns Handling
While an accommodating returns policy greatly increases customer satisfaction, it requires efficient management of those items when they come back to your facilities to prevent them from becoming a costly waste product. Mapping the return path will highlight if any products are being sent unnecessarily to trash, when instead they could be repackaged for sale or identified as defective and returned to suppliers.
In some instances, certain returned materials may require secure destruction via a certified contractor, with production of the necessary documents of destruction.
6. Conduct Audits and Establish Reduction Targets
Once you’ve completed these waste minimization practices, set up regular audits in order to ensure that standards are upheld. Once the inefficiencies have been identified, it becomes a relatively easy process to monitor the processes and make small further improvements where necessary.
Create template reports to enable those who are monitoring performance to be able to check that operations remain within the established ranges. Then once you’re consistently achieving the goals set, you can set new targets to make the supply chain even more efficient and less wasteful.
Build Waste Reduction Into Your Supply Chain with NWA
National Waste Associates (NWA) has years of experience providing practical, low cost waste management solutions to the logistics industry. We are able to apply this experience to provide your business with best practice guidance that we have seen can generate proven savings in the real world. Click on this link to learn more.
Our expert team looks at your operations holistically, and provides solutions that are tailored right down to the individual location. This diligent approach provides the greatest savings in the fastest time, prioritizing the areas of the business that are costing you the most.
At the same time, we’ll also recommend how to streamline your waste operations so you’ll have the lowest carbon footprint, and the maximum value is extracted from all resources consumed.
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