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Conveyor systems: Total Cost of Ownership

September 28, 2010

conveyor system

Conveyors, like any capital investment have multiple costs. The amount on your invoice is hardly the last time you’ll pay for that conveyor. If a conveyor is correctly specified and designed for future use, significant cost savings can be realized.

The three costs a conveyor system carries:

  • Initial costs – the easiest to understand and quantify. This is the cost of equipment, installation, and controls.
  • Operational costs – electrical usage  & pneumatics usage
  • Maintenance costs – Spare parts, replacement parts, & labor costs

All of these costs are spread over the conveyor’s useful life, so a formula that might best express what your conveyor will cost is: TCO (total cost of ownership) = IC (initial cost) + OC (operational costs) + MC (maintenance costs)/ useful life of the system.

Higher initial costs may be recouped in lower maintenance and operational costs over time if the right decisions are made when the equipment is specified and ordered. The initial cost savings can be eaten up by higher operating and maintenance costs, but neither of those is as expensive as a system that cannot do the job it was deployed to do. Long term costs can easily outstrip the initial costs. What are the real, long term costs and what can you do to control them?

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WERC Council of North Texas Warehousing Resource Convention

September 14, 2010

werc logoJust a quick tip of the hat to the The North Texas WERC (Warehousing Education and Research Council) Chapter. They are planning a 1-day convention on Thursday, September 23, 2010. Even if you’re not a member, you’re welcome to go. Cisco-Eagle will be there, so come by and see us if you attend. Besides our booth, you can visit 8,000 square feet of exhibit showroom and attend four educational presentations with a total of 12 topic options. For an inexpensive, quick, but informative day, it’s hard to beat. There will be raffles, continental breakfast, a hot lunch, and excellent networking opportunities.

The conference is sponsored by TCU and DCVelocity.

  • Where: Grapevine Convention Center, 1209 South Main Street, Grapevine, TX 76051
  • When: Thursday, September 23
  • Cost: $20 to WERC Members, $25 to non-members. Free to students & faculty with ID’s (must submit info prior to the 23rd).
  • More information: Visit the North Texas WERC site

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Shipping Docks & Safety: Dealing with Blind Spots

August 17, 2010

loading docks

Shipping & receiving docks are a particularly dangerous area of most operations because so much activity takes place in a relatively small space. In your average warehouse, the docks take up 20% of the square footage but host 80% of the activity. As you know, at times that activity can be fast-paced – even frenzied as full pallets are taken in, or loaded ones are being loaded into trailers. This is a time rife with possibilities for accidents. How can you prevent them?

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Pickers, Packers, and Conveyor Reliability

August 13, 2010

Do your line employees help extend the life of your conveyors? If you don’t know the answer to that question, it’s probably “no.”

conveyor belt systems

Employees are the first line of defense when it comes to minimizing maintenance problems, according to Cliff Holste at Supply Chain Digest. Are you adequately preparing them to fulfill that role? Are they trained, equipped, and encouraged to help you prevent issues with conveyors and other equipment? Past the jump, a couple of ways to help your line workers become more aware of ways to keep your systems running…

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The importance of correctly installing lockers

July 23, 2010

This video illustrates the reason why we always advise customers to securely bolt their lockers, racks and shelving to the floor.

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Cool your warehouse with solar powered “big” ceiling fans

June 24, 2010

solar powered HVLS fan

It’s that season – facilities across the country are facing mounting utility bills, workers drenched in sweat, and ferocious heat. Typically, an HVLS fan is one of the best solutions to these issues, but MacroAir has gone one better by producing these massive air movement ceiling fans in a solar configuration. This innovation does a couple of things. First, it cools your facility during the day, using the same method other HVLS fans use. But beyond that, it’s a very green product, one that reduces your energy costs and carbon footprint. Currently, these fans come in solar-only configurations. They won’t run when the sun is down, and they do not have battery backup systems. However, there is an option being designed to allow you to tie them to building power for night time or non-seasonal applications.

More information here…

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Posted in Docks & Shipping, Manufacturing, Material Handling, Order Picking & Fulfillment, Safety & Ergonomics, Sustainability, Warehousing| No Comments »

Forklift Safety: Don’t Blame the Driver

June 24, 2010

hurtling forklift in a warehouse

Environmental factors are often ignored

One percent of factory accidents involve forklift trucks, but the forklift accidents produce ten percent of the physical injuries. That’s an astonishing ratio, but not all that surprising given the nature of forklifts and the way they are utilized. Forklifts are dense, heavy-mass vehicles. When they collide with something – or someone – the results are devastating, even at low speeds.

Some leading types of lift truck accidents are:

  • Workers struck by forklifts
  • Loads are dropped onto employees
  • Driver catches his body between the forklift and other objects
  • The forklift is driven off the loading dock

Kind of a terrifying list, don’t you think?

Most forklift accidents are blamed on operator error, but that is just partially true – and something of a cop-out. Rough estimates say that a quarter of forklift accidents could be avoided by addressing environmental concerns. When you eliminate those, it helps you understand better when a driver is truly ineffective, or just hamstrung by the way your warehouse is set up. In other words, before you point the finger at the driver, take a look at your operation…

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Posted in AisleCop, Docks & Shipping, Manufacturing, Material Handling, Order Picking & Fulfillment, Pallet Rack, Safety & Ergonomics, Warehousing| No Comments »

Lean Logistics Summit Kicks Off in June

June 2, 2010

The Lean Logistics Summit kicks of on June 22 in Cincinnati. The Summit will gather the world’s leading authorities on the subject of lean logistics. Authors, researchers, and company representatives actually on their own lean logistics journey will share their insights. Learn from them and learn from your peers as you network with like-minded professionals. Sessions of interest to warehousing and distribution professionals might include “A Case Study in Lean Distribution,” by Sarah Giffin, Sr. Operations Improvement Manager of CEVA Logistics on 6/22. Also, check out “Implementing Lean Inside the Logistics Facility” later that day. The summit costs $995, but use the code “leannation” for a 25% discount.

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It is the Veteran…

May 28, 2010

Memorial Day

This has very little to do with warehousing, storage, or material handling – the normal stuff you’d see on this blog. It has everything to do with the debt we owe our veterans as the long weekend approaches.  This certainly isn’t original on our part, but it’s about the most apt thing I can think of to say. If you served, or have family who have served, thanks. We owe you everything.

It is the  VETERAN,  not the preacher,
who has given us freedom of religion.

It is  the VETERAN, not the reporter,
who has given us freedom of the press.

It is the VETERAN,  not the poet,
who has given us freedom of speech.

It is  the VETERAN, not the campus organizer,
who has given us freedom to assemble.

It is the VETERAN, not the lawyer,
who has given us the right to a fair trial.

It is the VETERAN, not the politician,
Who has given us the right to vote.

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Section 179 Enhanced Limits Extended for 2010 tax year

May 25, 2010

This is great news for small business. How great?

All businesses that purchase or finance less than $800,000 in business equipment should qualify for the Section 179 Deduction. To qualify for the Section 179 Deduction, the equipment purchased must be placed into service between January 1, 2010 and December 31, 2010. The list of qualifying equipment includes machines purchased for business use, vehicles, computers, and property attached to your building that isn’t part of the structure (essentially, most material handling equipment). For more information, check out the Section 179 website – it has lists of qualifying companies and an online calculator that helps you figure out your position. As always, see a tax professional to ensure your company and purchase qualify.

Please Note – The HIRE Act does not extend the 50% bonus depreciation that was available in the 2009 tax year.  We’ll let you know if there is movement toward extending that credit.

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