Corrugated Paper Warehouse Management - Loss Control

The loss of raw paper is the key to reducing costs

The base paper accounts for about 60% to 80% of the cost of the carton, depending on the added value of the carton product. For example, the base paper of the profiled box accounts for approximately 60% of the product cost, and the base paper for the drawn board accounts for approximately 80% or more of the cost of the board.

Calculated at 70%, a 1% reduction in base paper consumption means an increase of 0.7% profit, which equals an increase of 7,000 yuan in profits per million turnover. For a carton enterprise with an annual output of 50 million, 1% of the base paper will lose a profit of 23.5 million yuan. This is a pretty amazing number. This is also why domestic and foreign carton companies have focused on reducing the loss of raw paper.

Source of raw paper loss

The loss of base paper comes from internal departments of the company:

Improper raw paper purchase: No paper or width required, unneeded paper or width but inventory, it will cause waste.

The loss of raw paper stocks: improper procurement of raw paper will cause excessive inventory, resulting in inventory loss, such as the original paper surface damage, scrap and so on.

Cardboard production losses: Paper loss from the corrugating machine can occur every time the paper is changed. Controlling the number of paper changes is an effective way to reduce the loss of raw paper.

Loss in the carton forming section: Excess inventory of semi-finished products (WIP) or stagnant semi-finished products is the main cause of paper loss.

Complete inventory loss: To meet the requirements of Just in time delivery, finished inventory is essential. However, inventory occupies land, accounts for money, accounts for employees, may be lost, and may no longer be needed by customers.

The sum of the above losses is the total loss of the base paper. Accurately monitoring the loss of each department is a prerequisite for reducing losses. As a business executive, can you accurately know the daily loss of various departments?

The loss of raw paper is related to the internal departments of the company. This is a systematic project. It is necessary to proceed from the overall situation, and it is not only necessary to optimize locally. Personally, I believe that the key to reducing the loss of raw paper lies in the management of paper storage.

Figure 1 shows the basic paper warehouse management workflow, from the purchase of raw paper to the storage of paper rolls, and the export of paper rolls and scraps. From a process perspective, companies may be similar.

The key is two things:

Managed to each roll of paper. Each roll of paper has a “life” cycle: roll-in and roll-out, and roll-in and roll-out until it runs out. The roll-in storage is related to the purchase order and the delivery is related to the production lot number or period. Once this relationship is established, you can trace the source of the raw paper loss and find ways to reduce the loss of the base paper.

Management of residual volumes. There is a very high probability that a roll of corrugating machines in a roll-out warehouse cannot be used up. The registration of the remaining unfilled rolls (which also means the registration of the base paper used in the work order) is extremely important for tracking the source of the raw paper loss.

These two aspects are the differences between foreign and domestic, Guangdong and the mainland carton factory in the original paper warehouse management. Some domestic carton factories do not regard the management of each roll of paper, and believe that the workload of the warehouse staff is increased. For warehousing, the workload has increased. However, the workload will be greatly reduced for inventory management, inventory counting, and tracking of paper loss. Both abroad, the salary of the staff is much higher than the domestic case, the foreign carton factory is managed to each roll of paper. The proportion of base paper in carton costs is significantly higher than that of one or two warehouse workers. In fact, this is a problem of management concept.

Solve the problem of management concepts, the next step is to manage the method of each roll of paper, you can use different methods and technologies, such as:

From the original handwritten roll number to the base paper label, then attach the label to the roll;

Use computer to generate paper roll number and bar code, print the paper label, and then manually put the label on the paper roll; or you can ask the paper supply supplier to pre-tag the label to the paper roll.

Using the latest radio frequency identification (RFID), the computer generates electronic tags, and then manually attach the tags to the paper roll.

to sum up

The difference between different ways and techniques is how to generate a roll label. Different paper label labels have a great influence on the later work, that is, the inventory checking, the out-of-stock and the volume of scraps, and the accuracy of the data. Figures 2 and 3 show the methods and technologies used by foreign carton factories.

The key to reduce the loss of raw paper lies in the storage and management of the base paper. The key to original paper storage management lies in the ability to manage the first roll of base paper and the management of the remaining rolls, or to “refining” the existing base paper stocks.

In addition, since the first roll of raw paper has a "life" cycle, into and out of storage, storage and storage of the remaining roll until the end of the use. The relationship between the base paper and purchase order, the relationship between the base paper and the production batch number or time period Can establish and save, you can trace the source of the paper loss, from which to find ways to reduce the loss of the original paper.

Remember: Every 1% reduction in base paper consumption means an increase of 0.7% profit, which equals a profit increase of 7,000 yuan per million turnover.

(author/Wang Ming)
<Corrugated carton> June 2005 issue