Saturday, November 11, 2006

Tool management system halves costs

Yorkshire Fittings, a leading manufacturer of fittings and valves, has more than halved its monthly tooling costs as a result of installing a Tool Management System from Burcas.

Yorkshire Fittings, a leading manufacturer of fittings and valves for the plumbing and HVAC industries, has more than halved its monthly tooling costs as a result of installing a tool management system from Burcas. The system which was installed two years ago, and holds in the region of 580 different tooling items, is providing significant benefits to the company in several ways as Purchasing Manager, Paul Connolley, explains; 'We have a busy factory and we use a significant amount of tooling stock every month. In order to avoid out-of-stock situations, which could potentially have caused delays, we used to hold an excess of tools - a position that was aggravated by the very long lead times for certain items.

This meant that it was very difficult to control the amount of tooling we were holding and also increased the costs of holding stock.

In addition the administration of raising tooling purchase orders added no value within the supply chain and was in fact an additional cost.

It was clear that we needed a tool management system to give us better control and flexibility - so we searched the market for potential suppliers, but only Burcas offered us a real solution.' The Burcas System consists of a series of metal cabinets, which are located close to where the tooling will be used; each of which contains a set of numbered drawers.

Each drawer is given a reference number, relating to a particular tool item, for example a drill bit of a particular size, and contains space for the required number of those items, which in the case of Yorkshire Fittings varies between five and one hundred, including safety stock.

Each week a Burcas representative arrives on site to check and replenish the tools in the cabinets.

The implementation at Yorkshire Fittings created a smooth change-over between the original arrangement and the new system, with the Burcas cabinets at first being filled with stock already held by Yorkshire Fittings and being replenished from that stock until it was exhausted, after which it was replaced by new stock from Burcas.

During this time Burcas provided a reporting facility, enabling Yorkshire Fittings to make a more accurate assessment of its real tooling usage, and this incremental improvement in stock holding has been continuing throughout the two years that the system has been in operation.

Paul concludes; 'The system is vendor managed, making it really simple for us to operate.

It provides stock replenishment within 24 hours if required, but more usually through the regular weekly visits from Burcas, who also hold duplicate stocks.

The system provides us with three major benefits; firstly it allows us to control our tooling - so releasing capital that was previously tied up in unnecessary stock, secondly it saves us administrative time, because we now have a single source supply for these items and it cuts out the need to raise purchase orders, and thirdly, we do not have to pay for tools until we use them.

So, using the Burcas system, we can be very lean with our tooling costs, while being confident that we will not suffer from delays due to stock-outs - all of which allows us to provide a better service to our factory and ultimately our customers.'