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Smart Power Blog

4 Creative Ways to Increase Supply Chain Uptime and Reduce Costs

Posted by Ryan Lynch on Feb 15, 2019 3:22:00 PM

Reduce supply chain costMany companies are so caught up in maintaining supply chain uptime that they end up unwittingly sabotaging their productivity in the long run. Ironic, right? How does this happen?  

It’s simple. Business often tend to neglect their forklifts and the batteries that power them, figuring they’ll fit service in when they aren’t quite so busy. Often, that downtime doesn’t come soon enough—which means a lot of scurrying to find a solution when all that neglect takes a toll and shortens the life of the forklift or the battery.  

Here are some tips to help you squeeze every single dollar out of your forklift by lowering costs and increasing productivity. Read on to find out how your company could be missing out on more than a million dollars in savings each year! 

1. Maintain batteries properly 

If you ask most operations or productions managers how long their forklift batteries last, they’ll tell you five years. And, yes—that’s how long a properly maintained battery will last. Unfortunately, the vast majority start deteriorating rapidly around three years and few make it the full five years. That means you may pay $5,000 or more for a battery, expecting to get five years out of it, but you only get 60 percent of that lifespan before you have to replace it again.  

That’s the bad news. The good news is that a properly maintained battery can get the full five years. The number one battery killer is bad charging habits, which can be easily remedied with a little knowledge and planning. It’s also important to ensure your maintenance personnel understand batteries: knowing how and when they should be watered, as well as how to check for acid and make acid adjustments.  You could even say that a proper maintenance schedule turns the battery into an ATM machine. 

2. Convert from LP to Electric Forklifts 

Propane, the traditional method of powering forklifts, is often unwieldy, inefficient, and expensive—but companies are sometimes hesitant to convert despite the fact that electric forklifts are much easier to power up and the costs are much lower. Let’s crunch some numbers to see just how much you could be saving.   

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For example, propane runs for an eight-hour shift and costs $24 per tank. While the cost of electricity varies based on your charge per kilowatt hour, it typically averages about $3 for those same eight hours.  

So, if you’re running 100 forklifts, you’d save $2,400 on just one shift. If you run two shifts for 261 work days, that adds up to $1.1 million in savings in fuel costs for just one year.  

But that’s not the only way to save. Companies often dedicate significant warehouse space to battery storage and electric power allows much of that space to be freed up for inventory or other needs. Electric power can also eliminate propane cages, as well as cranes to swap out the batteries from storage, which creates a much safer work environment and reduces injuries. Using opportunity and fast charge technology, battery changes are not required, reducing the need for dedicated personnel to swap propane or batteries, often a big cost for large, high velocity facilities.   

3. Weigh the Total Cost of Ownership 

We hate to be the bearer of bad news, but the upfront cost of a forklift—while substantial—is only a fraction of its total lifetime cost—typically 30% or less. You’ll also need to consider the costs of wear and tear, fuel type and consumption, safety features, and environmental impact.  

For example, if you’re buying a car for yourself, you don’t just look at costs and buy the cheapest one available. You consider things like independent reviews, ratings, and safety records to judge which one will have the lowest total cost to fit your needs. You may decide that it’s more worthwhile to pick a car that’s more expensive but has a stellar rating that shows it needs few repairs over its lifetime as opposed to a cheaper car that has a reputation for needing replacement parts frequently. You’re looking at total costs by calculating which car will get you to work on time every day with no hassle instead of looking at only the price you’d pay to buy the car. 

You should be looking at your supply chain uptime through the same lens. 

4. Consider New Ways of Saving Costs  

We get it. Change is hard. You not only have to make sure change is worthwhile, you have to convince everyone else at your business to get onboard as well. Companies are often reluctant to consider a new way of doing things or research a new technology because what they’ve always done seems to be working fine, even if it’s not optimizing costs, making your facility more efficient, or wasting operators’ time.    

But resistance to change can really stymy cost savings, not to mention make you less competitive. If you have too much on your plate, then consider calling in experts to help you assess your needs and make recommendations. A strategic approach can save you a lot of money and will allow your company to refocus on your core business. 

 

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Topics: Fleet Management, Forklift Maintenance, Uptime

 

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