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Raw material cost

production efficiencyIf you start benchmarking theoretical consumption and actual consumption, you can get an estimate of the potential savings. If these are significant, the next step is to look at how to reduce the gap between actual and theoretical consumption. Conduct a benchmarking per product and per process to see where to focus. The more information you have, the easier it is to identify improvements.Raw material consumption can be reduced by focusing on reducing shrinkage and optimizing the production process in order to ensure efficiency. For companies who recover raw material by use of distillation processes, significant savings can be achieved through optimization. For one company I managed a project where we reduced the raw material consumption with 470 000 $ annual by recovering distillate that normally were sent to the boiler house.

Shrinkage of raw materials often ends up as emission, through the companies’ wastewater, air emission, waste to landfill or waste for recovery. If you want to reduce the waste, you need to control your emissions. By reducing the waste, you can achieve cost reduction at the same time as you save the environment! For more information see "Emission control". If you want assistance increasing production efficiency and benchmarking energy and raw material usage feel free to contact Lean Tech for an offer.

Energy cost

energy efficiencyStart by mapping today’s consumption: how much energy is used for different purposes in production? Energy per product? Energy for different process steps? For different machines and equipment? The more you know about your energy consumption, the easier you can improve energy efficiency.

If you do not have the necessary measurements, you can calculate the theoretical consumption, and start by improving your most energy intensive processes. If there are great deviation between theoretical and practical consumption it means the potential for improvement is significant! It can be profitable to invest in flow meters for steam or electricity meters in order to differentiate the consumption, and identify the most energy intensive processes. I have helped a company reduce the energy costs with 200 000 $ annual by mapping the consumption and optimizing the effectiveness of the production process. I also helped Allnex benchmarking the energy consumption per product at a project.