Using Kanban to Cut Costs

Kanban to Cut CostsLooking for areas in your facility to cut down on wastes? Inventory is a great place to start.

Maintaining and storing large amounts of inventory and materials is a costly task, you need to not only purchase those extra items, but you need to take up valuable space in the facility for storage.  When you are able to reduce inventory, you are in turn also able to reduce costs. Utilizing and implementing a kanban system is a great tool to combat overproduction and identify bottlenecks, ultimately cutting costs for the organization.

Kanban systems use visual cues like cards or signs to signal production processes. Instead of forecasting and trying to estimate how much inventory you should produce, the kanban system ensures you only produce the amount of inventory that is demanded by the customer. Introducing kanban into the workplace is a relatively low-cost venture, but the savings of not producing unnecessary products and maintaining extra inventory are huge.

Another way that kanban cuts costs is by reducing logistical costs and wait times. When your employees do not have the materials to do their job, you lose money. When you have to pay extra to get the things you need to get your production moving along, you also spend extra money. Using kanban prevents both of these problems because it is all based on supply and demand. You should never again have to pay people to do nothing or pay extra for a rush delivery of supplies.

The systematic approach of kanban allows managers and workers to identify bottlenecks and areas in production that can be streamlined. When work is leveled out, companies can truly maximize both their time and resources in the manufacturing process.

Kanban is a system that saves time, saves money, reduces waste, and maintains and improves employee morale. If you have all of these things in place, continued success is sure to follow. The principles of kanban allow production to flow in an easier and more manageable way so there are fewer errors and less room for them in everyday processes.

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