Company
President Dick Verbeek CPIM CIRM CSCP utilized his presentation at the
2008 APICS International Conference to illustrate one powerful
way to minimize costs and reduce the carbon footprint of a
supply chain. Utilizing the manufacture of a popular health supplement as an
example, his presentation summarized the results generated by proprietary
optimization software created by Performance Plus Consultants.
To initiate the process, Mr. Verbeek entered the dimensions of the physical product, and all shipping containers into the Optimizer software system. The system is unique in its approach to TOTAL supply chain optimization in that it may increase costs in one area in order to optimize the ENTIRE system.
"The optimizer increased packaging costs by recommending shipping containers that utilized extra corrugated packaging", noted Mr. Verbeek. "In this example, a small shipper , currently 2709 cm2 in area, should be replaced by one of different dimensions. The recommended shipper has the capacity to transport 16 individual bottles of product, and consumes 2750 cm2 of packaging material. The small shippers were packed into a larger container for transport across the country. On the surface, the recommendations would appear to be suboptimal. However, the increased packaging facilitates a massive 49% transportation efficiency gain. Given the high cost of diesel fuel, the net effect translates into a large net cost savings for the organization. As an extra bonus, the company can also realize a significant carbon footprint reduction by shipping less air and more product!"
The following table summarizes some of the key recommendations of the optimization process:
| Details | Current State | Recommendations |
| Shipper corrugated area | 2709 cm2 | 2750 cm2 |
| Capacity of shipper (bottles of product) | 16 | 16 |
| Large shipping container area | 44,748 cm2 | 47,356 cm2 |
| Capacity of shipping container (bottles of product) | 720 | 1024 |
| Number of Large Containers 43" trailer | 84 | 88 |
| 43" Trailer bottle capacity | 60,480 | 90,112 |
Redesigning product packaging is just one of many tactics that Performance Plus Consultants utilizes when searching for opportunities to reduce an organization's supply chain footprint. Readers of this article can contact Dick Verbeek via email to discuss other carbon footprint reduction methods and opportunities. (Dick.Verbeek@SupplyChainFootprint.com)
Attendees of the APICS Conference can download Mr. Verbeek's complete presentation, Challenging Carbon Footprint Paradigms, from the conference website www.softconference.com