In our previous post, we talked about how to cut a huge amount of money from your operating expenses.
Now, let’s talk about how to cut 20 hours a week from your purchasing activities.
First, think about what those 20 hours mean to you. Is it more time with family? A hobby? The ability to work on higher level projects?
Now, think deeply about the cost of those 20 hours. What do you cost? Are there projects that are not moving forward because you’re too busy? What’s the opportunity costs of those projects not moving forward?
Now that we’ve got a nice starting point of what those 20 hours means to you personally and as a cost to your operation, let’s find a few ways to help you recapture them…
Recapturing Your 20 Hours
Reduce the time you spend sourcing
You and your team spend a ton of time and money processing material costs.
We see this day in and day out.
If you can cut the amount of time you spend sourcing, processing, chasing and tracing your aircraft material needs, you’ll begin recapturing your 20 hours in no time.
There are many ways to do this but you have to be smart about it. After all, you could stop purchasing all together and watch chaos ensue. Let’s be logical about the next steps.
The first step is to reduce your time sourcing.
Going to 100 vendors, to cut 100 POs, to save $1,000 is just not practical. You’ll spend $20,000 just to process those POs. That’s 20X more than you thought you were saving. Madness!
Work with a trusted material partner who has the ability and material to quote you systematically on all your material needs. For example, send the list of 100 parts you need to Skylink and you’ll receive one quote from your Dedicated Account Manager, no matter how many rotables, expendables, consumables or pieces of tooling are on the list.
Dramatically limit the time you and your team spends processing material needs
Processing POs takes time.
From having to cut the PO, send the PO, chase the PO and then resolve any issue or cancellations with the PO. It’s a huge time suck.
Focus on cutting the amount of POs you’re currently processing in half while still getting the material you need.
If you can do that, you just regained a huge amount of time.
Utilize a vendor managed inventory for all your high consumption needs
If you know what your high consumption items are and the future requirements, using a vendor managed inventory is a game changer for your operation.
All you need to do is place your high consumption items into a vendor managed program and you’ll receive automatic replenishment inventory when you hit a minimum stock level.
Just imagine how much time that would save, the amount of capital it would remove from your shelves and the processing cost it would decrease. The new cash flow will have a huge impact on your operations!
In Skylink’s vendor managed inventory, we systematically consolidate other programs and shipments with our VMI shipments. These include exchanges, out of VMI consumables, and return asset repairs, among others. We do this to further reduce your need to over-process orders to us.
Think about it.
There are many ways you can recapture your 20 hours. If your expendable and consumable needs are high enough, I say, start with a VMI.