Incorporating Lean Automotive Manufacturing Principles Delivers Component Savings for Collins Bus Corporation
"Carlton-Bates has been a very important partner for us in the Lean process.” – Jeff Eriksen, Collins Bus Procurement Manager
- Decrease inventory investment and space
- Reduce inventory planning, transactions, and optimize replenishment time
- Reduce time and touches by buyers sourcing products
- Cut unnecessary costs
- Improve processes to control the availability and flow of products
- Consolidate total number of suppliers
Carlton-Bates sales team overhauled component pricing, increased time spent in the factory, lent technical knowledge, and optimized the Vendor Managed Inventory (VMI) platform.
- Consolidated orders and cut logistic costs by around $1,500 a year.
- $10,000 in savings by consolidating spend and finding alternative parts.
- Added extra savings through negotiated pricing.
- Introduced new process for continuous evaluation of parts' needs.
About Collins Bus Corporation
Located in South Hutchinson, Kansas, Collins Bus is the leading manufacturer of Type-A buses in North America. Their newest generation bus includes integrated power switching and circuit protection instead of the more commonly used complex bus and automotive electrical systems that are less efficient. The buses have a cleaner design that allows passengers and drivers to have more visibility to their surroundings and each bus can be fitted with handicap devices.
After 45 years of operation, Collins Bus knows what they have to do to remain a leader in their industry. They must do business smarter, quicker and more technologically advanced. Recently they made a commitment to embrace Lean manufacturing practices as a way to help reduce costs and streamline production. One of their first steps to incorporate Lean was to integrate Carlton-Bates’ Vendor Managed Inventory (VMI) platform.
Implementing Lean Automotive Manufacturing Strategies
The first step for CBC was to develop a comprehensive understanding of how Collins Bus uses their electronic components and determine what inventory was needed and when. Together, the Collins Bus buyer and CBC Field Sales Representative Chris O’Connor came up with a plan of attack. Small orders could be held and consolidated with larger purchases allowing more items to be shipped together on a single pallet instead of being shipped in pieces, saving operational time and expense. By working closely with the Collins Bus buyers, O’Connor manages unexpected demands. The estimated logistic and operational savings add up to an estimated $1,500 a year.
"Chris understands what our goals are and with his work in inventory management, he helps us meet those goals,” said Jeff Eriksen, Collins Bus Procurement Manager.
Inventory Management for Automotive Components Supporting Lean Principles
As Collins Bus integrated Lean manufacturing best practices, they looked for additional ways CBC could save them time and money. They allowed O’Connor to assist in finding the most cost effective parts on new builds. He also finds cost savings on the electronic parts being used today by negotiating with suppliers. Representing so many products and suppliers, O’Connor is able to help with tactical planning and assist in selecting between competitive products. He has worked with multiple electronic parts suppliers to negotiate better prices and find alternatives that are more competitively priced.
According to Eriksen, O’Connor has been very involved in cost-reduction initiatives on value-analysis and value-engineering. “He offers suggestions and different applications and plays a big role,” said Eriksen. “Lean keeps us on top of our industry and keeps us competitive. Chris recognizes that,” he adds. “Carlton-Bates has been a very important partner for us in the Lean process.”
Over the past 10 years, the Carlton-Bates team proactively worked with Collins Bus buyers and engineers to continuously evaluate needed electronic parts. As a result of hard work and dedication to the success of their client, CBC has grown its relationship with Collins Bus.
"Our partnership is a direct reflection of the CBC-Collins history. We have confidence in Carlton-Bates, the whole organization, Chris, and the customer service team,” said Eriksen.
Reducing the time and money spent on procurement, logistics, and far-reaching supplier relationships, along with inventory reductions are not only Lean best practices but good team maneuvers. According to O’Connor, it’s just part of the job.