Reducing Scrap with "Mults" Length Options
What is the best way to measure material cost? Is it cost per pound? Cost per foot? Or is it cost per utilized pound?
Tubular Steel has found that the right length for the job is the single most effective means to hold down material costs for a project or for production. While scrap can be sold, and remnant lengths may be utilized in the future, remnants also become scrap and scrap hardly recoups material costs.
If every job either used entire mill lengths or a mill length could be neatly cut into the required sizes without waste than the need for "Mults" would not exist. However, in the real world of manufacturing and fabrication requirements don't conveniently fit into mill lengths.
That's where Tubular Steel can help in two ways. Consider the following example. One of TSI's fabricators required the following square tubing for a project. They provided TSI with the actual required lengths.
The company received a quote from their supplier. While their service center had both sizes they stocked only 40' mill lengths. Using 40' lengths resulted in over 36% scrap.
The fabricator had frequently used TSI as a supplier when their primary supplier was out of stock, or when a project required an unusual size that only TSI carried. Surprised at the high waste the fabricator called the direct 800 number of their TSI Account Manager to comparatively shop.
The first surprise was that the TSI Account Manager asked what the cut-to-lengths were. Never before had an order taker at other suppliers asked for this information. The TSI Account Manager explained about the TSI cutting software, into which he would enter the cut to length. The software would evaluate end requirements and existing stock and make the most cost effective recommendations. While the fabricator could have waited on the line for the answers he chose to fax the information to TSI and while he went to lunch.
When he returned from lunch the following quote was on his desk.
The TSI quote had less than 5% scrap! Though the "per" costs were higher (3% cost per pound, 2% cost per foot), the fabricator saved over $2000 on the project.
"That was the most profitable lunch I can remember", exclaimed the purchasing agent.
"Let me tell you about our cut-to-length program", replied the TSI Account Manager.
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