AUTOMATIC PART RESUPPLY

By Dr. David M. Anderson, P.E., CMC
Build-to-Order Consulting
www.build-to-order-consulting.com
Copyright 2017 by David M. Anderson

See article on Inventory Reduction

Kanban

    The illustration below shows two rows of part bins which are set up for resupply by the two-bin kanban system.1  Initial assembly starts with all bins full of parts. When the part bin nearest the worker is depleted, the full bin behind moves forward, as shown by the empty space in the illustration. The empty part bin then is returned to its "source," which could be the machine that made the part, a sub-assembly workstation that assembled the part, or a supplier. The source fills the bin and returns it to this assembly workstation behind its counterpart which is now dispensing parts.

    The beauty of Kanban part resupply is that the system ensures an uninterrupted supply of parts without forecasts or complicated ordering procedures. The number of parts in a bin is based on the highest expected usage rate and the longest resupply time. The size of the bins are determined by the bin quantity and size of the parts. For large parts, some companies use two-truck kanbans, in which parts are drawn from one truck trailer while the other trailer goes back to the supplier for more parts. Alternate systems include kanban squares for larger parts and a two-card system where the cards travel (or are faxed) back to the source instead of the bins. Electronic equivalents are also possible.

    In order for Kanban systems to work, there must be enough room to dispense all parts at the points of use. This, again, emphasis the importance of part standardization.

Breadtruck Resupply

    The "lowest hanging fruit" in material logistics is the breadtruck delivery system for small, inexpensive parts. Instead of counting on sales forecasts to trigger an MRP system to generate purchase orders, all the small, inexpensive parts can be made available in bins at all the points of use. A local supplier is contracted to simply keep the bins full and bill the company monthly for what has been used, much like the way bread is resupplied by the breadtruck in a small market.

    All the MRP/purchasing expense is eliminated and this type of delivery can assure a constant supply of parts, thus avoiding work stoppages. Being off the forecast/MRP system, the supply of these parts can be assured for "forecast-less" operations such as Build-to-Order. Typical parts suitable for breadtruck deliveries are fasteners, resistors, capacitors, and almost any small, inexpensive part.

    As companies become more agile, they may include slightly more expensive and slightly larger parts into the breadtruck system. The more expensive parts may incur some inventory carrying cost, but that should be outweighed by savings in purchasing, materials overhead, expediting, and avoiding work stoppages.

Criteria for Breadtruck Deliveries:

C A reliable supplier can be contracted. Many suppliers welcome such business and want to perform well, since they usually get all the business for their categories of parts and raw materials.

C Parts can be distributed at all points of use. Of course, part standardization helps here

C Parts are small enough and cheap enough so that sufficient parts will always be on hand. Bin count can be set high enough to preclude any chance of ever running out.

C Parts are not likely to go obsolete or deteriorate while waiting to be used.

C The breadtruck parts are not so "attractive" as to create a significant pilferage problem, since, generally, companies do not correlate part consumption with product sales. However, making breadtruck parts freely available for R&D prototypes and factory improvements may encourage innovation.

C Manual reorders are not anticipated to occur. The supplier should be in a continuous improvement mode and be constantly adjusting bin count to correspond to prevailing demand. The factory could alert the supplier about any anticipated "spikes" in demand.

     Automatic resupply techniques are taught in the context of build-to-order and mass customization through Dr. Anderson's in-house seminars and implemented through his leading-edge consulting.

References

1. David M. Anderson, "Build-to-Order & Mass Customization, the Ultimate Supply Chain and Lean Manufacturing Strategy for Low-Cost On-Demand Production without Forecasts or Inventory," (2004, 520 pages, CIM Press,1-805-924-0200; www.build-to-order-consulting.com/books.htm); Chapter 7, "Spontaneous Supply Chain."

      Dr. Anderson is a California-based consultant specializing in training and consulting on build-to-order, mass customization, lean/flow production, design for manufacturability, and cost reduction. He is the author of  "Build-to-Order & Mass Customization, The Ultimate Supply Chain Management and Lean Manufacturing Strategy for Low-Cost On-Demand Production without Forecasts or Inventory" (2008, 512 pages; CIM Press, 1-805-924-0200, www.build-to-order-consulting.com/books.htm) and "Design for Manufacturability & Concurrent Engineering; How to Design for Low Cost, Design in High Quality, Design for Lean Manufacture, and Design Quickly for Fast Production" (2008, 448 pages; CIM Press, 1-805-924-0200; www.design4manufacturability.com/books.htm).  He can be reached at (805) 924-0100 or anderson@build-to-order-consulting.com; web-site: www.build-to-order-consulting.com.

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