EIP Implemented: In-house Dunnage Management

Scope

Process for sorting and storing dunnage at the Memphis, Tennessee NASP Metals facility

Goal

Process for sorting and storing dunnage at the Memphis, Tennessee NASP Metals facility

Result

Reduction in cost associated with using a third-party sorting company for dunnage sorting and storage, reduction in dunnage lead time, and improved dunnage quality

Prior to the implementation of this EIP, the Memphis facility shipped received dunnage across the state to a third-party company to be sorted and stored. Once sorted, the dunnage was returned to the facility for use in outgoing shipments. This process required the facility to cover the third-party’s building rent and utilities, pay for labor, and absorb additional costs to transport the dunnage back across Tennessee to the Memphis plant.

Dunnage refers to any material used to protect or secure cargo during transportation, preventing damage from movement, moisture, or impact.

At the Memphis facility, dunnage is typically pallets, cardboard slip sheets, and top frames. Dunnage from inbound shipments of raw materials or components can be re-used on outgoing shipments of finished product.

To cut costs and shorten lead times, the facility secured a local warehouse that could be repurposed for dunnage sorting and storage, dedicating half of its space to dunnage management. Larry Cain, Memphis Plant Manager commented, “While the allocation of warehouse space in this manner reduces the space available for overstock items, we are able to manage without any added cost to the plant. The added value of internally managing dunnage outweighs the loss of available space for overstock.” Inside the plant’s main production building, two new incoming lanes were added to stage and supply sorted dunnage to the production lines. To support this in-house process, the facility also created two additional positions dedicated to managing dunnage flow.

Conclusion:

The facility saved approximately $552,000 in the first year by eliminating the need for a third-party sorting company. This change also lowered costs, reduced safety risks, and minimized the environmental impact of transporting dunnage across the state. Additionally, managing dunnage in-house has improved the quality of materials for outbound shipments and enhanced the facility’s ability to fulfill rush orders without waiting for supplies to be shipped from a remote location.

“Any plant that has outside services processing their dunnage, or any other material management, should review the potential cost savings based on space availability and freight costs. This has been a great project to be involved with,” says Cain.

Call to Action

At Mauser, continuous improvement is part of our culture. Since implementation, the Earning Improvement Program (EIP) has been crucial in maintaining our financial stability, saving over $615 million while enhancing safety, collaboration, efficiency, and sustainability.

Your involvement is essential at every stage of the EIP process, from idea generation to implementation.

We've seen significant value where EIP has been embraced, but there's still untapped potential. We need your innovative ideas to achieve our ambitious goals for 2026. Submit your ideas and help implement them to drive Mauser forward. Together, we can make a significant impact.