January 15, 2020 Blog

Ways to Reduce Cost in Roll Forming Manufacturing Using ERP Systems

An ERP (Enterprise Resource Planning) is a system that is used for managing a business – usually a software or a package of several interconnected applications – which is used to increase the overall productivity of a company.

It helps to save, gather, manipulate and deduce data from different departments. ERPs optimize business processes by bringing together all the various sections of the company such as – sales, manufacturing, accounts, human resources and so on.

Each department is able to input and receive data, often in real time; as soon as the system is implemented. One major advantage of integrating an ERP system is the centralization of data. Millions of data can be found and organized in one accessible location.

This significantly increases the efficiency of workflow as there is no waiting time to collect any sort of information. As it is completely automated, no time is wasted due to manual input. With large amounts of information, the number of mistakes that can occur is also amplified; particularly human error.

All of this is greatly reduced with the integration of ERP software. It also often leads to increased collaboration among employees and improved transparency, giving them a sense of responsibility towards the company. Additionally, it allows you to examine the company’s performance by calculating the profitability, KPI, liquidity and other factors at any given time.

In short, integrating an ERP system is there to automate your whole business and provide a visual of the current scenario, analyze past data and an idea of how the business will shape up to be in the future. 

Here are a few ways how you can reduce the manufacturing cost of roll forming using ERP systems:


1. Reducing lag time from providers

Downtime is one of the major issues that result in decreased profits. The way to avoid this is by choosing an experienced partner who can decrease the downtime as much as possible. This in turn helps to manufacture less costly parts and allows the products to be shipped sooner.

The way to go about this is to make sure the downtime is being monitored closely. Records should be made for each session and logged in to the ERP system to keep track. After sufficient data is integrated into the system, by manipulating the data the root of certain downtimes can be identified. 

This is where a reliable and experienced partner comes in. A partner who has been involved in the business for a considerable amount of time are aware of ERPs and use it to facilitate organization, reduce the setup times and also improve speed runs. For example, if a supplier is inexperienced, they will more likely than not have inconsistent methods, an unorganized working space, and delays between jobs and so on.  Especially if the inexperienced supplier is to produce a complex part as it requires high levels of organizational skills. 


2. Using the right materials and tools

The bulk of the cost for manufacturing rolls is from the purchase of raw materials. This is further depended on:

I. The cost of the process vs. the amount of metal in the part

II. The type of metal used for the roll

III. Thickness of the metal used

IV. Amount of scrap produced during the process

V. Conditions of the metal market  

On average, a roll formed part is comprised of 50% to 70% raw material cost. If the material used is dense and costly (stainless steel, heavy bronze; for example), the cost of the raw material can hike up to as much as 85% of the total price.

This is where certain questions need to be posed.  What is the function of my roll? Does it need to have an attractive stainless steel finish or can I make do with one that is of average quality? Who will I be selling it to? For example, it would be quite pointless to produce a roll that is pleasing to the eye but will be used for underground infrastructure. Not only will it increase the production cost, the revenue generated will be low as well. The tools required to produce a roll varies with the type of roll being produced. 

An ERP that can keep track of the projects the rolls are being manufactured for and the target customers can decrease these unnecessary production costs and vastly increase the revenue. It can also have set templates for the most commonly produced rolls and hence it will allow you to keep the required tool in the plant beforehand.


3. Keeping it simple

The more intricate a roll is, the more time it requires to be setup. This is mainly because the complexity of the rolls produced depends on the number of times the rolls need to be loaded on the machine. A typical design requires around 12 to 16 forming passes however, in contrast; the most intricate ones can take up to more than 50 passes on the machine.

Calculating the time beforehand using an ERP module can significantly reduce the lag time. This can also predict the time taken for more complex designs to be produced so you can start preparing before the set time. 

In summary, the simpler you make your design with accordance with the client, the faster your rolls will be produced. 


4. Keeping track of the inventory

Often times, more than what is necessary is bought. For example, you require around 10 thousand tons of steel for an order of rolls. Your plant already has around 2 thousand left over steel from a previous order, but you end u p buying 10 thousand tons anyway. This not only increases cost, it also produces more scraps which in turn reduces your revenue.

 Keeping track of inventories is crucial when it comes to manufacturing. Using ERP modules, all departments of the company (sales, accounts and finance) can keep up with how much to buy or use with a lot of efficiency and miscommunications. 

Syncoria is a digital transformation firm based in Canada and is an official Odoo Ready Partner.

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