Where is the most expensive place to create scrap?

The further along the manufacturing process where scrap occurs, the more expensive that scrap is.  This is pretty obvious and intuitive.   If you scrap a product out at the beginning of the operation, your cost is essentially the raw material cost. The more value that is added to the product the higher the scrap cost. Scraping a product at the end of the operation is far more expensive than scrapping a product at the beginning.  While scrap incurred during any part of the manufacturing process is unacceptable, it makes sense that scrap elimination efforts should be prioritized by where the product is the most expensive to scrap.

The most expensive place to scrap a product is during shipping and handling, yet many businesses don’t include shipping and handling operations in their scrap reduction and lean manufacturing efforts. Packnet believes that packaging should be considered in all waste reduction and cost improvement efforts.