3 Steps to Demolish the Costs of Damage

Damage throughout the supply chain is a fact of life. It costs a bomb. The good news is you're not helpless and there's several steps to minimise these unwanted costs. Let's identify the costs first and then the steps to take.

The Costs of Damage

The 3 costs we want to reduce are - 

  1. Inventory Loss - includes unsaleable items, due to some type of damage
  2. Repair and Replace - if someone crashes into it, it needs to be fixed
  3. Injuries - can be the highest cost of all

Step One - Identify

What are the potential causes of Asset Damage?

  1. People - it's only human to make errors. Circumstances get in the way. Concentration can be broken. People always present risks.
  2. Equipment - as facilities develop over time, is equipment still up to the job? Right for increased volumes? Not well maintained? Is inadequate or incorrect protection and guarding in place? And could something fail completely? A collapsing rack? A failed forklift brake?
  3. Layout and Design - have things started getting too crowded? Limited areas eventually lead to collision between equipment, stock and people
  4. Nature - flood, fire, wind, earthquake - examples of events that need to be considered

Step Two - Process

Processes keep things in order. An effective system will not only smooth out operations; it will also highlight issues and anomalies, so they can be addressed and resolved. 

When it comes to damage prevention, processes to consider include how a pallet is unpacked, how stock is picked from the shelf (and with what equipment). Even a process for managing incoming vehicles to your warehouse. 

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Step Three - Train

Material handling is complex and processes help in reducing the number of touchpoints. From here, effective training kicks in. When speaking on damage reduction, forklifts are a prime focus. The US National Institute for Occupational Safety and Health reports that 80% of forklift repair and maintenance costs are due to operator misuse and abuse. Damage to stock will also be determined by operator standards. 

Forklift damage

Forklifts are just part of the picture though. A team drilled in processes such as how to load and unload, how to stack and where to place stock will keep your stock in good order.

Step Four - Protective Equipment

Putting equipment in place to protect racking, walkways, doorways, equipment and stock is a quick and tangible way to immediately reduce damage costs in a materials handling facility. It's not a reason to drop the ball on processes and training - instead, it's a backup, for when the unexpected or unplanned occurs.

Protective Guarding Types

Rack end protection

Guard equipment can be incorporated into design of a new facility, or added into an existing site - especially one experiencing losses through damage. Three categories of equipment to consider are - 

  1. Rack Protection - a strong floor-mounted solution is imperative in keeping racking and stock intact. Corners and ends are hot-spots and require special focus.
  2. Bollards - strategic placement of bollards protects specific spots and they are used widely, across many environments. However, concrete and core-drilled bollards can cause expensive damage to flooring when impacted, as well as the forklift and the driver in a heavier collision. A solution with flexible core technology can install more quickly, and will absorb and deflect impact, rather than break. This leaves everything in tact.
  3. Rails and Barriers - used to avoid damage to walls and structural elements, and separate people and equipment. All barriers are not created equal - so consider high visibility and ability to absorb and deflect impacts to keep damage to a bare minimum.

Video footage and further descriptions of Asset Protection solutions are here and the Euroswift Australia team is available to conduct on-site inspections to assist you in reducing the costs of collision

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