INDUSTRIAL ENGINEERING

Report No. :02

Date :June 2016

Authorised by :

TITLE Determining the storage capacity of MTS in Laminates.

AUTHOR Keabetswe Taukobong

OBJECTIVE

Increasing the storage capacity of all MTS.

Change the current safety stocks on SAP.

Reduce material handling.

Implement the ABC analysis.

Reduce the amount of glass being stored in pallets on

the loading bays.

Train operators on 3 leg A-frames and 4 leg A-frame.

Improve the knowledge of point loading.

SUMMARY OF WORK

The storage capacity of Laminates MTS has to be determined

in order to eliminate over production and under production.

The safety stocks of materials will be changed, and we will

know the accurate number of materials in the allocated A-

frame and allocated storage bin. This project will help us

eliminate things like double handling on glass.

Introduction

The storage capacity of MTS in Laminates is unknown. This makes it difficult

to distinguish the safety stock on SAP, to know how much of a certain material

should be produced. The aim of this project is to balance the systematic side

being SAP with the physical side being the distribution area.

Theory

Capacity is the maximum amount that can be contained. Utilizing the storage

capacity wisely in the distribution area can prevent storing glass on pallets in

loading bays and also breakages that may occur due to material handling.

Activity Based Costing or ABC analysis is a method of allocating overhead

and direct expenses related to the most important activities of the company

first. This means that high priority inventory or Class A is the class of inventory

that is required most often. This includes all the standards in Laminates and

other coated and non-coated materials. Therefore those materials are stored

in large quantities. Class B is the medium priority and Class C consists of all

the slow moving materials.

This technique ensures control over the costly items in which a large amount

of capital is invested, it helps in developing scientific method of controlling

inventories, ensures considerable reduction in the storage expenses and most

importantly helps maintaining enough safety stock.

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Experimental

Below are the stock covers of March the 14th 2016, of coated and non- coated

glass.

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Laminates non-coated stock covers 14.03.2016Material Number Material Description Stock Target Stock

1550 6.38 INTRUDERPRUFE NS 2440x2000 2428 52321638 6.38 INTRUDERPRUFE NS 2440x2134 1340 17421642 6.38 INTRUDERPRUFE NS 3210x2250 1095 1234

10351 6.38 INTRUDERPRUFE NS 3210x2440 509 11381645 6.38 INTRUDERPRUFE NS 2440x1830 723 778

25869 6.38 INTRUDERPRUFE NS 2700x2025 550 68828524 6.38 INTRUDERPRUFE NS 3210x2440 P 139 25726929 6.38 INTRUDERPRUFE NS 3660x2440 32 119

1801 6.38 C/V ARCTIC SNOW NS 2440x2000 161 63229940 6.38 INTRUDERPRUFE LOW E NS 3210x2250 374 339

1689 6.38 C/V COOL GREY NS 2440x2000 421 32615314 8.38 INTRUDERPRUFE NS 3210x2440 70 325

1707 6.38 C/V COOL BRONZE NS 2440x2000 896 3073228 8.38 INTRUDERPRUFE NS 3210x2250 275 3031821 6.38 C/V SHADOWLITE 25 NS 2440x2000 526 266

26604 8.38 INTRUDERPRUFE NS 3660x2440 489 224

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Laminates coated stovers 14.03.2016Material Number Material Description SP3 Laminates Durban Cape Town Average Sales

1542 6.38 S/S S10 SILVER NS 2440x2000 1633 214 71 88 12531599 6.38 S/S S10 BRONZE NS 2440x2000 959 207 100 95 7501776 6.38 S/V HL NEUTRAL NS 2440x2000 532 176 69 31 3611557 S/S S10 GREY NS 2440x2000 347 105 69 56 303

13344 S/V HL NEUTRAL NS 3210x2250 118 458 0 0 25030046 S/V HL NEUTRAL LOW E 3210x2250 182 60 0 36 220

1681 6.38 S/S S10 BLUE NS 2440x2000 285 63 49 48 15313971 S/V S10 SILVER NS 3210x2250 147 8 0 26 14113923 8.38 S/V HL NEUTRAL NS 3210x2250 0 165 0 79 12513750 6.38 S/V HL NEUTRAL NS 3210x2440 0 90 0 37 12015489 6.38 S/S S10 SILVER NS 3210x2440 0 76 0 43 10620712 S/V HL GREY NS 3210x2250 0 94 0 19 8415498 6.38 S/S S10 BRONZE NS 3210x2440 288 1 9 22 5217333 6.38 S/V HL SERENE GREEN NS 3210x2250 0 109 0 0 36

Results

The distribution area was evaluated to see how many storage bins are there

for MTS and how many A-frames are allocated for them.

Some legs of A-frames were not being utilised which actually results in

less A-frames being used.

Materials were not correctly stored in terms of the point loading rule.

Refer annexure 1.

Operators don’t know which glass size goes onto which A-frame.

20 A-frames were being utilised for all the MTS excluding the standards which

are material number: 1550, 1638, 1645 and 3964.

There are 3 storage bins allocated only for MTS which are OABA01, 0ABA02

and 0ABA03.

Below is the number of A-frames which were utilized in the storage bins.

Table 1

Storage Bin Number of A-frames being used

0ABA01 7

0ABA02 7

0ABA03 6

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Discussion

ABC analysis at this stage is used. All the material that has high target stock

or average sales will be our first priority.

Standards

Class A

Class B

Class C

One thing that has to be considered as well is the size of glass and the type of

A-frame.

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Laminates non-coated stock covers 14.03.2016Material Number Material Description Stock Target Stock

1550 6.38 INTRUDERPRUFE NS 2440x2000 2428 52321638 6.38 INTRUDERPRUFE NS 2440x2134 1340 17421642 6.38 INTRUDERPRUFE NS 3210x2250 1095 1234

10351 6.38 INTRUDERPRUFE NS 3210x2440 509 11381645 6.38 INTRUDERPRUFE NS 2440x1830 723 778

25869 6.38 INTRUDERPRUFE NS 2700x2025 550 68828524 6.38 INTRUDERPRUFE NS 3210x2440 P 139 25726929 6.38 INTRUDERPRUFE NS 3660x2440 32 119

1801 6.38 C/V ARCTIC SNOW NS 2440x2000 161 63229940 6.38 INTRUDERPRUFE LOW E NS 3210x2250 374 339

1689 6.38 C/V COOL GREY NS 2440x2000 421 32615314 8.38 INTRUDERPRUFE NS 3210x2440 70 325

1707 6.38 C/V COOL BRONZE NS 2440x2000 896 3073228 8.38 INTRUDERPRUFE NS 3210x2250 275 3031821 6.38 C/V SHADOWLITE 25 NS 2440x2000 526 266

26604 8.38 INTRUDERPRUFE NS 3660x2440 489 224

Laminates coated stock covers 14.03.2016Material Number Material Description SP3 Laminates Durban Cape Town Average Sales

1542 6.38 S/S S10 SILVER NS 2440x2000 1633 214 71 88 12531599 6.38 S/S S10 BRONZE NS 2440x2000 959 207 100 95 7501776 6.38 S/V HL NEUTRAL NS 2440x2000 532 176 69 31 3611557 6.38 S/S S10 GREY NS 2440x2000 347 105 69 56 303

13344 6.38 S/V HL NEUTRAL NS 3210x2250 118 458 0 0 25030046 6.38 S/V HL NEUTRAL LOW E 3210x2250 182 60 0 36 220

1681 6.38 S/S S10 BLUE NS 2440X2000 285 63 49 48 15313971 6.38 S/S S10 SILVER NS 3210X2250 147 8 0 26 14113923 8.38 S/V HL NEUTRAL NS 3210x2250 0 165 0 79 12513750 6.38 S/V HL NEUTRAL NS 3210x2440 0 90 0 37 12015489 6.38 S/S S10 SILVER NS 3210x2440 0 76 0 43 10620712 S/V HL GREY NS 3210x2250 0 94 0 19 8415498 6.38 S/S S10 BRONZE NS 3210x2440 288 1 9 22 5217333 6.38 S/V HL SERENE GREEN NS 3210x2250 0 109 0 0 36

There are two types of A-frames in the distribution area, a 4 leg A-frame and 3

leg A-frame. Only the width 3210, 3660, 3300 goes onto a 4 leg A-frame, and

2440, 2700, 2650 goes onto a 3 leg.

After using this technique and sorting out the material, the number of A-

frames increased from 20 to 23. Refer to annexure 2.

Table 2

Storage bin Number of A-

frames

Number of 3

leg A-frames

Number of 4

leg A-frame

0ABA01 7 1 6

0ABA02 8 2 6

0ABA03 8 5 3

Below is the length of the A-frames on all the storage bins, and how many

sheets one A-frame can occupy including spacers. All these materials will be

in packs of 20.

Now more materials can be stored and space usage can be used wisely.

Other materials which are on Class C category will be transferred to plant

1100; all the materials that require paper will also be papered and be

transferred immediately.

Annexure 3: New safety stocks.

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Storage Bin Number Length of the A-frame(mm) Number of sheets in 1 A-frame Number of A-frames0ABA01 2320 280 70ABA02 730 80 80ABA03 1270 160 8

Conclusion

Stock covers contain certain disadvantages like not being accurately correct

on what may happen in the future. Therefore it is advisable to have an

alternative plan.

Physical inventory management is a checking the inventory on a weekly,

monthly, quarterly or yearly basis. This will help us keep accurate inventory

records.

In the distribution area, it is done on a weekly basis. This is also done to know

quickly which material moved from Class C to Class B or from Class A to

Class B, this is done by pasting colour code labels on pack slips or pack ID’s.

If a material moved from Class A to Class B then there is no need to allocate

too much space for it.

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Recommendation

A one point lesson should be done, in order to let operators know

which size of glass goes on which A-frame. Refer to annexure 2.

Safety stocks should be changed since we now have determined the

capacity of all the A-frames.

A standard operating procedure for point loading should be revised

with the operators in order to eliminate glass breaking on the edges or

glass being on hold due to edge quality.

All glass which cracked should immediately be removed from good

glass to the cutting table.

Stock Coordinators should always ensure that pack slips or pack ID’s

are not torn on glass.

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