Overproduction is a form of manufacturing waste that raises costs and hides inefficiencies. If you’re fabricating rubber products in-house, overproduction can hurt your business in various ways. For example, a mobile equipment manufacturer that produces too many door gaskets uses more labor and material than is necessary. There’s also a risk that the excess parts will become obsolete.
This article examines why overproduction is a form of manufacturing waste and how you can recognize its symptoms. You’ll also learn how to correct it, and how overproduction applies specifically to rubber products. Outsourcing your rubber fabrication to Elasto Proxy can help, so contact us to learn more about the value we provide.
Why is Overproduction Wasteful?
Overproduction occurs when you make more parts than are needed to meet demand. Fabricating a few extra components might seem harmless, and you might even argue that it’s beneficial. After all, it can prevent shortages and reduce the need for retrieving rubber from inventory and then cutting it. However, lean thinking shows that overproduction carries the following risks.
- Excess Inventory: Extra parts must be stored, and this requires warehouse space, racks, bins, and climate control. If rubber parts are stored improperly, such as in a warehouse that’s hot and humid, there’s a risk that the rubber will deteriorate more quickly.
- Obsolescence: Parts that remain in inventory for too long could become obsolete if design changes occur. For example, a gasket for a dump truck door whose design changes mid-year could become scrap material.
- Cash Flow: Money that’s tied up in inventory can’t be used for capital equipment, process improvements, or new projects. Overproduction carries an opportunity cost, and it can hurt your company’s competitiveness.
- Hidden Inefficiencies: Overproduction can hide bottlenecks, long setup times, and poor forecasting. Fixing the root cause is better than producing more parts to reduce the risk of stockouts.
What are the Symptoms of Overproduction?
Now that you know more about what overproduction is, how can you recognize it in your own business? Look for the following symptoms.
- Full Warehouses or Extra Storage: Aisles, corners, or offsite facilities are packed with raw materials or finished goods. In some cases, it’s hard to navigate with a forklift.
- High Work-in-Progress (WIP): Semi-finished parts are stacked up between operations, proof that an upstream process such as cutting is faster than a downstream process such as bonding can handle.
- Frequent Inventory Write-Offs: Materials expire or parts become obsolete before they can be used. That’s a cost right there, but there’s also a cost to handling unusable materials or products.
How Do You Correct Overproduction?
Correcting overproduction requires a disciplined approach to aligning production with customer demand. Here are a few strategies than can help.
- Implement Pull Systems: Pull systems like Kanban ensure that production is triggered by demand. For example, gaskets are only fabricated when they’re needed for an assembly.
- Focus on Continuous Flow: Parts that move smoothly from one operation to the next can prevent WIP buildups and overproduction.
- Reduce Batch Sizes: Large batches can maximize operational efficiency, but not in the absence of actual customer demand.
- Shorten Setup Times: Long setup times may encourage the production of extra parts to justify the changeover effort.
Can Outsourcing Address Overproduction?
With rubber products, you can also address overproduction by outsourcing your parts fabrication to Elasto Proxy. Consider sharing your production forecast with us and issuing a blanket purchase order so that you can receive part releases when you need them. Elasto Proxy also supports just-in-time inventory programs and can ship raw materials or finished goods on demand.
Ready to learn more? Eliminate the overproduction of rubber products with Elasto Proxy.
