Optimizing the purchasing of packaging material : a case project for Company X
Hennum, Jonas (2022)
Hennum, Jonas
2022
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Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-202202102315
https://urn.fi/URN:NBN:fi:amk-202202102315
Tiivistelmä
The thesis topic was chosen because of the potential impact findings could have in terms of saving waste for the company and the environment. The research was conducted through a case project at Company X’s premises. The thesis aimed at finding optimized order quantities and frequencies of packaging material and improve processes to achieve lower costs and inventory levels. This was found by investigating a determined focus group of articles and finding the economic order quantity of these, as well as implementing variables found in the research. The effect old packaging material has in production was investigated. Product research and slot optimization was researched to find ways to decrease inventory levels and deal with higher inventory levels. There is one version of the report for internal use and one public version. Confidential information was modified, censored or removed in the public version of the report.
Previous research has shown that there are some limitations to the theories presented, and that ordering smaller amounts generally gives a more lean and JIT approach. Ordering smaller batches generates less waste. Using the economic order quantity formula, reorder point formula and minimum/maximum stock formulas has limitations such as not considering changing demand from time to time and variables in costs based on order quantities. The research conducted in this thesis project collected quantitative and qualitative data. Theories and concepts from previous research were used as secondary research data to support the case project. An interview was conducted with ten warehouse workers to find qualitative data. Measurements and numbers from the ERP system were utilized to find quantitative data.
The major findings confirmed the theory that ordering smaller batches gives potential for waste saved and lowered inventory levels. Age of packaging material for seasonal products affect the efficiency percentage a lot, by decreasing when material gets older. There is a lot of stock that is marked for discarding. Nonactive stock could be discarded to lower inventory levels. Implications of the research includes limitations of theories, and possibilities to implement recommendations due to practicality. The significance of the thesis is saving waste in form of money, time, and environmental aspects. Freeing up space in the warehouse would enable stopping the usage of an external warehouse, and possibly improve employee satisfaction when processes are more streamlined and optimized.
Previous research has shown that there are some limitations to the theories presented, and that ordering smaller amounts generally gives a more lean and JIT approach. Ordering smaller batches generates less waste. Using the economic order quantity formula, reorder point formula and minimum/maximum stock formulas has limitations such as not considering changing demand from time to time and variables in costs based on order quantities. The research conducted in this thesis project collected quantitative and qualitative data. Theories and concepts from previous research were used as secondary research data to support the case project. An interview was conducted with ten warehouse workers to find qualitative data. Measurements and numbers from the ERP system were utilized to find quantitative data.
The major findings confirmed the theory that ordering smaller batches gives potential for waste saved and lowered inventory levels. Age of packaging material for seasonal products affect the efficiency percentage a lot, by decreasing when material gets older. There is a lot of stock that is marked for discarding. Nonactive stock could be discarded to lower inventory levels. Implications of the research includes limitations of theories, and possibilities to implement recommendations due to practicality. The significance of the thesis is saving waste in form of money, time, and environmental aspects. Freeing up space in the warehouse would enable stopping the usage of an external warehouse, and possibly improve employee satisfaction when processes are more streamlined and optimized.