Development of the Packaging Material Process at Plastal AB Simrishamn

Abstract: In the automotive industry, it is common that the customers provide the suppliers with the necessary packing material needed for delivery of the goods. The reason for this is that it makes the handling and unpacking of incoming goods at the customer easy, but it also makes sure that the quality of the packing material is high, and that the transportation damages of the goods are minimised. It should also serve as a support for the supplier, since the supplier would not have to worry about the quality and the distribution of the packing material. Plastal AB in Simrishamn is one of the bigger suppliers for the Swedish automotive industry, and uses customer owned packing material for the delivery of many of its products. Although the customer owned packing material has many advantages, it also limits the freedom of action for Plastal, since Plastal has to adapt to its customers’ procedures when it comes to lead times, ordering procedures, total allowed amount of packing material and other restrictions. The last years, the customers have become tougher on the packing material, and as a consequence of this together with poor, internal control at Plastal, there has been a lot of problems. An important one is that about 15 unanticipated emergency stops in machines at Plastal occurred during 2002 only, which lead to that machines had to be closed down and production reorganised. Such incidents are serious since they decrease the service reliability, and put the quality of the whole production at risk. The direct cost of this and some other problems amount to more than 1.5 MSEK annually, a figure that will probably increase in the future as the customers become even harder on the packing material. To minimise the above problems, it is important for Plastal to act as early as possible for an improvement of the packing material process. We believe that the best way to do this is to optimise the use of the packing material by integrating the whole process in Plastal’s computer system. This enables automation with increased control as results, which also reduces the risk of having emergency stops. A lot of other problems will also disappear thanks to this change. The economic impact of this is that Plastal will save more than 1.2 MSEK annually according to our calculations. The payback time for the necessary investment is only 2 months, making it highly prioritised and desirable. Moreover, the disturbances in the production connected to packing material will be diminished, making the whole production process more efficient.