Back in the late 1970’s and early 1980’s, American manufacturers started to embrace the concept of JIT (Just in Time). JIT promotes building only what you immediately need, as opposed to building larger quantities that would sit in stock until demand called for their use. The advantages of JIT were significant. Companies were able to reduce inventory across the board, which lead to much faster cycle times. Companies had less resources tied up in inventory and needed less facility space. Perhaps one of the biggest benefits of JIT was that scrap went down and quality went up. High WIP (work in process) and inventory hid defects. Once the WIP was reduced, scrap issues were immediately exposed and addressed. Another concept that was tied to JIT was “defect free” manufacturing.
Another idea that came about near the same time frame was “centers of excellence”. The concept was that no company could achieve excellence at everything, those that tried were sort of “jack of all trades but master of none”. As a result, many companies actually started contracting out more of their operations to manufacturing specialists and focused resources on their core competency.
By contracting out processes that were not part of their core competency, companies could reduce inventory further as well as reduce other overhead due to support systems required for these other operations. The JIT concept was still used with vendors as they were asked to supply parts on a weekly, daily or even hourly basis. Kanban systems were often used to “pull” parts from suppliers when needed. Excess inventory was reduced across the entire supply chain.
JIT manufacturing and “centers of excellence” can also include the packaging supplier. Many manufacturers products are large and require packaging that can take up a lot of space. Sometimes the packaging is sophisticated and may have several components such as custom foam inserts, specialty hardware and large custom containers. In fact creating the package system for each product is an assembly process in of itself.
Packnet addresses this issue by supplying kitted or pre-assembled packaging systems to its customers on a JIT basis. Customers can phone, fax or email in a pull ticket and Packnet will deliver the packaging systems on demand. Because Packnet is a packaging specialist, they are very good at assembling the system and have the base materials in stock. Packnet employs lean manufacturing methods in its own plant, and has very fast cycle times for most of its products. Most Customers who use this service can reduce the amount of space and inventory as well as experience labor savings. If you are interested in Packnet’s kitted packaging service, call us at 952-944-9124 for a free assessment and see how much inventory and money you can save.