Relectric Supply was established in January 2003 and is a privately owned California Corporation, located in the heart of the Silicon Valley. Relectric Supply caters to the low and medium voltage electrical distribution and control markets. They offer electrical equipment that is new or reconditioned to original factory specifications.
Client Business Need
The company’s previous manufacturing facility in San Jose was located in a small industrial park. Sales increased dramatically and the company quickly outgrew its original facility and acquired a new location with over 60,000 square feet of warehouse and manufacturing space. This created a flow issue, with parts being cataloged when received, disassembled, refurbished and placed in racking for resale.
Phase 1 – Creation of a cellular manufacturing (U shaped) work cell for the reconditioning and test areas.
- Six work cells were designed allowing for two jobs to be worked on simultaneously
- Roll-away carts were introduced so that product can flow from the work station directly into the carts
- Work cells can accommodate both small and large jobs
- Cells have a ‘next pallet’ location, eliminating wasted time between jobs
Phase 2 – Creation of similar shaped work cells and an improved process flow, including the addition of a “water spider.”
- Value stream map of the current state and development of the future state and roadmap for improvements
- Analysis of “buy item” flow, reducing non value added activities/costs
- Development of the water spider concept in the receiving and buy process work areas to streamline work flow and maximize capacity
- Consolidation of the receiving area to streamline flow
- Introduction of FIFO racks to reduce motion and transportation wastes
- Introduction of roll away carts to improve ergonomics and simplify the “put away” process by eliminating the need to sort items twice
Introduction of these elements dramatically reduced the movement of materials, reduced lead times and costs, while increasing communication and quality. Specific results included:
- Increased sales by $250,000
- Increased staff by three direct labor workers
- Retained current clients and associated sales of $100,000
- Realized cost savings of $112,000
- Investment in Plant and Equipment of $8,500
- Investment in Information Systems of $50,000
- Investment in New Products & Processes of $15,000
- Costs Savings of $118,000 due to new processes introduced