Production management is also a very important part. Whether it is self-production or outsourcing, enterprises must do a good job of tracking the entire process of the goods production cycle and managing the quality of goods. Product quality and product production cycle are the key parts of production management. If it is outsourcing, personnel can be sent to the factory to monitor production and quality control, and the factory can be constrained to reduce the defective rate and deliver on time by establishing factory production assessment standards.
① Tracking the entire process of the goods production cycle.
After the production department receives the sales plan from the sales department, it will formulate a commodity production plan according to the sales plan, and give the material list required for the production plan to the purchaser, and follow up on the purchaser’s material procurement arrangements, urging the purchaser to purchase the goods in time; after receiving the materials, track the delivery of the materials to the factory to arrange production, and confirm the production plan, production cycle, quality control and other related links with the factory to ensure that the factory delivers on time with quality and quantity.
② Establish factory production assessment standards.
In order to better manage production, corresponding assessment standards can be formulated for the factory. For example, the rate of goods quality compliance, the completion rate of the delivery cycle, and the material loss rate.
Goods quality compliance rate: If the defective rate of finished products produced by the factory is too high, it will affect the company’s sales delivery and product reputation. , Assuming that the quality inspection is not careful, the defective products are sent to customers as good finished products. This will not only increase the customer return and exchange rate and complaint rate, but also increase logistics costs, affecting the company’s sales. When a company sells a defective product, the impact on the company will be like the butterfly effect, with a series of chain reactions. The cost that the company has to pay is much higher than the production cost of this defective product. Therefore, when the production planner connects with the industrial and commercial department, he must strictly grasp the indicator of the goods quality compliance rate. A standard can be formulated, such as the defective rate cannot be higher than 3%~5%. For details, you can refer to the general indicators in the industry, such as clothing is generally within 3%, and electronics is generally within 5%. If this indicator is exceeded, the factory’s responsibility must be clarified.
Calculation method: Defective rate = number of defective products in this batch ÷ total number of production in this batch x 100%.
Delivery cycle completion rate: The delivery cycle completion rate is a very important indicator. The production planner must coordinate with the factory to complete the production and delivery of goods within the production plan cycle, otherwise it will affect the sales department’s goods sales plan, thereby affecting sales. The delivery cycle rate can be formulated according to the characteristics of the company’s products and relevant industry standards. For example, the delivery period compliance rate cannot be lower than 90%. If it is lower than 90%, the factory needs to bear the corresponding degree of responsibility for the company.
Calculation method: Delivery period compliance rate = 1- (number of days overdue ÷ actual production cycle days) x100%.
Material loss rate: It is very normal and unavoidable for the factory to produce material loss during the production process. Appropriate material loss is a normal phenomenon, and the company can bear it by itself, while excessive material loss will cause vigilance, and the corresponding standards and reward and punishment measures must be clarified. For example, a clothing trading company outsources a batch of women’s clothing. The factory’s comprehensive material loss rate is 5%, which is about 2% higher than the industry average. Assuming that the factory needs to be commissioned to produce 5 million yuan of women’s clothing every month, the 5% loss every month is 250,000 yuan, which is 3 million yuan a year. Although the loss points each month do not seem to be many, but if there is loss every month, it will be a considerable amount in a year. If the material loss rate is reduced, won’t the company’s profits increase?
Take a clothing company as an example. If it is agreed with the factory that the material loss rate must be reduced to 35% overall, the loss fee saved in a year is 1.2 million yuan. For losses exceeding 3%, the factory shall bear full responsibility except for the company’s own reasons.
Calculation method: Material loss rate = (material loss amount ÷ total material usage) x 100%.
Agreeing with the factory on performance appraisal will greatly support the overall supply chain management efficiency of the company, but companies generally have a lot of orders and a large scale to have the right to speak and become the rule-making party in the cooperation. The factory has many cooperative customers. The more orders the customers give, the more attention it will naturally receive. Therefore, while the company is doing a good job of internal supply chain management, its external sales capabilities and product competitiveness must also be continuously improved.