Assembly Planbook - March 2009 - (Page 40)

ASSEMBLY Planbook Home, Away— and Back Again One American manufacturer keeps ahead of offshore competition through lean manufacturing, ingenuity and expertise. A By implementing a pull-based scheduling system, Truth Hardware was able to increase the number of shelf stock items it offers, even as it reduced overall inventory levels. By Doug Johnson Vice President of New Business Development Truth Hardware Owatonna, MN fter years of manufacturing contracts moving overseas, the tide is turning. It’s not sweeping the manufacturing community all at once, but bit by bit, contract by contract, U.S. companies are realizing that American ingenuity and quality are not only superior to that of overseas suppliers, but also more affordable. “Five years ago, there was a real push to move production— particularly component creation—overseas,” says Dominic Korbel, director of assembly value streams at Truth Hardware. “Every article painted doom and gloom for the industry, with Asia offering equal facilities with much cheaper labor. With the bottom line always in mind, our customers began to buy from offshore suppliers.” Fast-forward five years: After experiencing firsthand what it’s like to source directly from Asian manufacturers, as well as feeling the effect of losing customers to offshore suppliers, we refocused in a familiar direction—the United States. For reasons both intangible and quantifiable, we reached the same conclusion as several of our top customers: When it comes to manufacturing, there’s no place like home. Exploring Asia To remain cost-competitive with our peers, we did contract with Asian suppliers to provide components for our window and door hardware. Ultimately, however, these relationships did not deliver the cost savings that we originally imagined. “The weakening dollar-to-yen currency exchange was not working in our favor,” recalls Korbel. “With the yen fluctuating more and more within global markets, we [had difficulty] preserving the financial advantage of going overseas. “We decided to source from overseas depending on where we could get the best quality, price, service and delivery to meet our customers’ needs. But eventually, that was not what we were getting. For instance, as stricter enforcement of labor laws and environmental regulations came about, Asian manufacturing costs started to rise.” In addition, the rising price of petroleum increased shipping expenses, inflating the ultimate cost of our products across the whole value stream. “It’s not even the high cost of oil, necessarily, that causes problems—it’s the variability in the price,” says Korbel. “With transportation costs potentially changing from week to week, it’s difficult to quote prices with confidence if you’re dependent on factors beyond your control.” We also lost confidence in pricing because of various shipping-related surcharges, which made tracking true costs difficult in our accounting systems. These one-time costs were eventually added to the price of our products, but 40 ASSEMBLY / March 2009 www.assemblymag.com http://www.assemblymag.com

Table of Contents Feed for the Digital Edition of Assembly - March 2009

Assembly - March 2009 Contents How To Design Lean Cells For Flexibility How To Use Lean Techniques To Achieve Sustainable Manufacturing How To Frost a Big Strudel Dispense Thicker Assembly Fluids With Greater Speed and Less Hand Fatigue How To Solve Your Process Control Problems in Dispensing How To Improve Efficiency and Accuracy with Selective Spray Coating Systems How To Set Up a High Efficiency High Production Riveting Station How To Estimate The Friction Coefficient During Fastening How To Choose Fasteners That Maximize Assembly Life How To Select the Right Electro-Mechanical (Servo) Assembly Press How To of ‘In Process Assembly Monitoring’ How To Specify Multi-Functioning End-of-Arm Tooling for Robotic Workcells How To Select a Rotary Actuator How To Eliminate Output Overloads and Maintenance in Your Index Table Applications. How To Eliminate Thread Backlash When a Nut Counters a Setscrew How To Self Program & Fasten Multiple Parts On One Assembly Machine How To Select the Right Test Method to Leak Test Your Products How To Approaching The Bench:What To Consider Before You Purchase A Workbench How To Implement 5S At Your Workstation

Assembly - March 2009

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