Why your expansion plan needs supply chain modeling

A supply chain analysis can lead to better decision-making and more efficient capital expenditures. Here are some specific questions to answer related to your supply chain.


A supply chain analysis can lead to better decision-making and more efficient capital expenditures. Here are some specific questions to answer related to your supply chain. Courtesy: StellarAs the food processing industry continues to flourish, many manufacturers are faced with the need to increase capacity. Whether it's adding a new process line, building an additional plant or expanding an existing facility, conducting a supply chain analysis in partnership with your design team can lead to better decision-making and more efficient capital expenditures.

Supply chain is one of the first factors to consider in your expansion plan. If you're planning to move production of a specific product to another location, there is a supply chain network cost associated with that. How will you manage increased inventory requirements and costs? Have you considered increased transportation costs? If you want to build a new greenfield project to accommodate increased production needs, you'll first need to look at your supply chain and the factors that will impact the location. With multiple plants and multiple distribution centers impacting thousands of customers, your expansion plan gets complex pretty quick.

Strengthening your supply chain
Step one of any plant expansion plan is determining what will produce a stronger supply chain network for your plant in the long haul. While cost is an issue, it's also about your supply chain network's responsiveness, service levels and the overall effect on your processing operations. Here are some specific questions to answer related to your supply chain:

  • Where are my suppliers?
  • How am I buying from my suppliers?
  • What sized lots do I have?
  • What are my minimum order quantities?
  • Once I've made my materials, where do I stock them to provide a certain level of material to my customers?
  • Which products do I stock? Where do I stock them?
  • Do I stock everything? Can I do that?
  • Which product do I push out most to customers?
  • Which products do I hold at central or district warehouses? Regional warehouses? How much do I hold?

Spreadsheets can model some of these effects and costs, but the data stops at what happens within the four walls of the plant. And while answers to these questions may solve some supply chain issues, you'll want to bring in your food plant design experts to address broader issues of space requirements and budget implications. Models are only as good as the data that goes into them, and when used together, these two pieces of input can help you make the best choice for the long-term success of your company.

Jason Duff has more than 23 years of experience in the design, analysis and improvement of operations, systems and facilities.This article originally appeared on Stellar Food for Thoughts. Stellar is a CFE content partner. Edited by Joy Chang, digital project manager, CFE Media, jchang@cfemedia.com

No comments
The Top Plant program honors outstanding manufacturing facilities in North America. View the 2015 Top Plant.
The Product of the Year program recognizes products newly released in the manufacturing industries.
The Engineering Leaders Under 40 program identifies and gives recognition to young engineers who...
Safety for 18 years, warehouse maintenance tips, Ethernet and the IIoT, GAMS 2016 recap
2016 Engineering Leaders Under 40; Future vision: Where is manufacturing headed?; Electrical distribution, redefined
Strategic outsourcing delivers efficiency; Sleeve bearing clearance; Causes of water hammer; Improve air quality; Maintenance safety; GAMS preview
SCADA at the junction, Managing risk through maintenance, Moving at the speed of data
Safety at every angle, Big Data's impact on operations, bridging the skills gap
The digital oilfield: Utilizing Big Data can yield big savings; Virtualization a real solution; Tracking SIS performance
Applying network redundancy; Overcoming loop tuning challenges; PID control and networks
Driving motor efficiency; Preventing arc flash in mission critical facilities; Integrating alternative power and existing electrical systems
Package boilers; Natural gas infrared heating; Thermal treasure; Standby generation; Natural gas supports green efforts

Annual Salary Survey

Before the calendar turned, 2016 already had the makings of a pivotal year for manufacturing, and for the world.

There were the big events for the year, including the United States as Partner Country at Hannover Messe in April and the 2016 International Manufacturing Technology Show in Chicago in September. There's also the matter of the U.S. presidential elections in November, which promise to shape policy in manufacturing for years to come.

But the year started with global economic turmoil, as a slowdown in Chinese manufacturing triggered a worldwide stock hiccup that sent values plummeting. The continued plunge in world oil prices has resulted in a slowdown in exploration and, by extension, the manufacture of exploration equipment.

Read more: 2015 Salary Survey

Maintenance and reliability tips and best practices from the maintenance and reliability coaches at Allied Reliability Group.
The One Voice for Manufacturing blog reports on federal public policy issues impacting the manufacturing sector. One Voice is a joint effort by the National Tooling and Machining...
The Society for Maintenance and Reliability Professionals an organization devoted...
Join this ongoing discussion of machine guarding topics, including solutions assessments, regulatory compliance, gap analysis...
IMS Research, recently acquired by IHS Inc., is a leading independent supplier of market research and consultancy to the global electronics industry.
Maintenance is not optional in manufacturing. It’s a profit center, driving productivity and uptime while reducing overall repair costs.
The Lachance on CMMS blog is about current maintenance topics. Blogger Paul Lachance is president and chief technology officer for Smartware Group.
This article collection contains several articles on the vital role of plant safety and offers advice on best practices.
This article collection contains several articles on the Industrial Internet of Things (IIoT) and how it is transforming manufacturing.
This article collection contains several articles on strategic maintenance and understanding all the parts of your plant.
click me