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Where are the Biggest Cost Savings?
To stay competitive, companies must continually find new ways to improve efficiency and cut costs. WasteWise partners have demonstrated that preventing solid waste (source reduction) offers significant cost savings. But where do you find the biggest savings for your company? First, identify each of your key business operations. Then, for each key operation, identify the products and materials used or generated in the largest quantities. These are the materials that should be evaluated first for waste prevention opportunities.
Depending on the type of company, WasteWise partners have found the greatest cost savings in the following areas: shipping and receiving (reducing transport packaging), office operations (reducing paper that is mailed or used internally), and manufacturing (reducing process waste or the amount of material used in a product). Remember that the greatest waste prevention savings often accrue from avoided purchasing costs. This means that for any of the above areas, purchasing records can be an important key for identifying major purchases so they can be evaluated for waste prevention potential.
Work with purchasing agents and records to identify major purchases that could be reduced, e.g., by working with suppliers to reduce packaging or through reuse of supplies.
- Purchase orders and other papers are stacked high. Could we use an EDI system to reduce paper purchase orders and other forms?
- Employees can be your best resource for identifying efficiencies and cost saving opportunities. Solicit their ideas on ways to reduce office waste.
- Copier paper is a significant expense. Is there a way to encourage more double-sided copying? Perhaps with educational posters near copy machines?
- Does this long report really need to be printed? Perhaps employees could view it online and only print essential pages? Perhaps we could shorten the report?
- Is there a way to reduce these corrugated boxes before they are recycled? Perhaps we could switch to reusable containers or reduce the box size?
- Could these pallets be repaired or the wood reused for another purpose?
- Could our product packaging use less or lighter-weight material?
- Could the product be redesigned to use less material?
- A lot of excess material is generated by the production process
is the equipment as efficient as possible? Could the excess material
be reduced through changes in operator practices or materials?
Partner Success Stories
The case studies below illustrate waste prevention successes in three key areas: office paper reduction, transport packaging reduction, and reduction of waste from manufacturing processes. For most companies, those activities have a proven track record in yielding significant cost savings. Depending on the size, structure, and primary business operations of an organization, the biggest cost saving opportunity, and the amount of potential savings, may differ.
Conserving Office Paper at BellSouth Telecommunications
During 1994 and 1995, Bell South Telecommunications conserved 16 million
sheets of printout paper and saved $3.5 million by implementing
an electronic filing system. The companys system of storing reports
electronically enables employees to view, download, or print reports archived
in the companys data centers from their own workstations. Implementing
this system has helped the company conserve paper, improve efficiency,
and reduce the need for paper storage. Prior to initiating the electronic
filing system, employees could only obtain reports by ordering complete
printed copies. Employees now can save resources by viewing reports online
or printing individual pages.
Transport Packaging Reduction Leads to Big Cost Savings
- Pepsi-Cola saved $44 million by switching from corrugated to reusable plastic shipping containers for one liter and 20-ounce bottles, conserving 196 million pounds of corrugated material.
- Dow Corning Corp. reconditioned steel drums in 1995, saving nearly $2.3 million and conserving 7.8 million pounds of steel. In addition, Dow Corning saved $530,000 in 1994 by repairing and reusing 1.7 million pounds of wood pallets.
- AMP, Inc., an electronics manufacturer, established a returnable tote program for shipping products to its customers. The switch to reusables from corrugated containers saved the company nearly $450,000 and conserved 478,000 pounds of corrugated material in 1995.
- HASBRO, Inc. reduced the thickness of corrugated shipping containers
by 15 percent in 1995, which saved $400,000 and conserved
more than 763,000 pounds of material.
EG&G Employee Teamwork Reduces Manufacturing Waste
EG&G, a high-technology and scientific equipment supplier, uses employee teams to identify waste reduction opportunities. Discussions between an engineer and a purchasing expert uncovered one opportunity that now saves the company nearly $100,000 each year. By changing the specifications for a steel-alloy part used in manufacturing seals, EG&G was able to purchase an alternative material that required less cutting and shaping to meet the customers needs. Just this one material switch reduced EG&Gs shipping costs, maintenance costs (to clean up waste), and labor costs (by 33 percent). The company also realized substantial savings through a 66 percent reduction in metal waste.