Supply Chain Services
What is the "Supply Chain"?
The Supply Chain is the set
of organizations and activities involved in moving your raw materials from your
supplier’s supplier, through your value added activity, and on to your
customer’s customer. It encompasses all of the packaging systems and material movement along the way.
Why is the Supply Chain Important?
In today’s globalized world, efficient product distribution is the single most important factor in controlling costs. Thus, a company that optimizes their supply chain stands to reap a much higher return on investment than their competitor who might focus on optimizing materials or manufacturing costs. In 2012, the GDP for the
United States was recorded at a total of $15.65 trillion. Over the past few years an estimated average
of 9% of the United States market value of all officially recognized final
goods and service is allocated to costs relating to logistics. To put this in perspective, 9% of $15.65 is $1.41
trillion spent solely on logistical costs.
As shown in the chart, the
majority of costs relating to logistics are from transportation, warehousing,
and inventory carrying. In addition, these costs are highly influenced by package efficiency and cube utilization of the systems.
How is the Supply Chain Optimized?
One of the quickest and easiest ways to reduce supply chain costs is to eliminate wasted space often found in product packaging, storage, and transportation systems. A thorough analysis starts with evaluating the product’s packaging and unitized loads for opportunities.
Based on a study performed in conjunction with a well-known manufacturer of printers, potential savings of up to $5 million per year was estimated simply by improving the cube utilization of the system and shipping 12 extra units per pallet. Breaking down the costs, approximately 30% were from materials and 70% were due to transportation and storage (logistics costs).
How Can Westpak Help With Supply Chain?
Westpak assists clients in all areas of supply chain optimization regardless of the type of product and/or package system being utilized or proposed. Westpak begins with a clear understanding of the client’s requirements and goals. Westpak’s engineers have thorough knowledge and experience with industry recognized tests designed to simulate the distribution environment a product encounters in transit. Evaluation of unitized loads such as pallets, crates, and shipping containers would focus on how space is utilized.