Rising Turnover Costs in Manufacturing: Mitigation Through Automation

Employee turnover can be expensive. In fact, Josh Bersin of Deloitte believes the cost of losing an employee can range from tens of thousands of dollars to 1.5–2.0x the employee’s annual salary. These costs include hiring, onboarding, training, ramp time to peak productivity, the loss of engagement from others due to high turnover, and higher business error rates. (Altman, 2017).

In a time when speed-to-market, low defect rates, and low cost-per-unit levels drive profitability more than ever, manufacturers are particularly affected by employee turnover. In 2016, manufacturers experienced turnover rates of 16%. (Bares, 2017). Doing the math, one can see that if their company turns over 16% of their operating workforce, and turnover costs are 2x the lost workers’ salaries, then annual turnover costs can equal up to 32% of your total operating payroll per year (assuming equal wages for simplicity’s sake). The “learning curve” effect also plays its part in higher defect rates and lower productivity, decreasing product quality and speed-to-market (Argote and Epple, 1990). In other words, turnover can severely affect profitability, especially in manufacturing.

So, what can manufacturers do about it? The psychology and social science on this subject has been published for many years, yet turnover rates are still high and have risen consistently over the past five years. Let R.V. Evans Company take a different approach. If you’re a manufacturer, do any of these activities fall under any of your workers’ job descriptions?

  • Forming cases and boxes
  • Closing and stapling boxes/cases
  • Sealing/taping cases
  • Bagging parts
  • Stretch-wrapping pallets
  • Printing images, date and batch codes, or barcodes on products or cases
  • Applying labels
  • Manually creating void-fill protective packaging for cases
  • Manually shrink-wrapping products
  • Applying strap to bundles, boxes, pallets, etc.

If you answered yes to any of those, there is room for automation.

Automation doesn’t always come in the form of complete robotics; there are ways to semi-automate as well. Semi-automation reduces the amount of laborers required to perform certain tasks in the manufacturing process, particularly in packaging processes. Examples of automation and semi-automation include:

  • Incorporating a WFPS 3290 Combo to allow a single operator to form, pack, and seal up to 30 cases per minute
  • Using an AutoBag 550 to allow a single operator to bag up to 45 parts per minute
  • Install an Orion Flex Series stretch wrapper to wrap pallets much faster than by hand
    • with a 260% pre-stretch that can save up to several thousand dollars in stretch wrap per year
  • Implementing a Samuel Model P715 automatic plastic strapping machine to apply plastic strap to your packages at speeds of up to 60 straps per minute- without an operator
  • Connecting many of these systems and others via conveyor equipment
  • Much, much more

There are numerous ways R.V. Evans and its team of packaging solutions representatives can help you reduce turnover by eliminating some of those high-turnover positions entirely. This is not a recommendation to replace your good, high-quality people that make your operation great. This is a recommendation to allow R.V. Evans to help you find ways to eliminate positions that are difficult to keep occupied due to high turnover. Equip your good workers with the means to produce more and add more value- at a lower total cost. Automating, semi-automating, and/or streamlining your processes can increase your speed to market, decrease your cost-per-unit, lean out your labor force, and make you more money. 

Why R.V. Evans? Because we are a team of experts whose core competencies are creating packaging solutions and giving great customer service. We spend every day staying up to date with the latest technology, studying that technology, and creating ways to implement it in various manufacturing environments. You are the expert in your operation, and we are packaging solutions experts. Team up with us so we can create a packaging solution that is right for you. We will forever follow up with great service.

Here is how to get started. 3 options are included below.

  1. Click here to schedule a site needs analysis with one of our packaging experts
  2. Click here to request general information about a specific product or product line
  3. Call 800-252-5894 to speak to one of our wonderful customer service representatives

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Shrink and Stretch Wrapping: Differences and Applications

“Go ahead and shrink wrap that pallet”, my boss said before he walked out of the warehouse. I leaped into action only to waste 15 minutes searching for a shrink wrapper in the warehouse. There wasn’t one. As my boss returned, he said to me in an annoyed voice, “Ok, what was confusing about shrink wrapping the pallet?”. “I noticed there isn’t a shrink wrapper here, sir”, I said. He stared at me for a second before replying, “Ok…I guess it is hard to miss”, then he grabbed the pallet jack and wheeled the pallet over to a large, conspicuous stretch wrapper just 20 feet away.

There is a common confusion regarding shrink wrapping and stretch wrapping. These two applications have something in common: they are both methods of packaging something in plastic. However, these applications package things much differently and for different purposes.

Shrink Wrapping

Shrink wrapping is the process of using shrink film, a material comprised of polymer plastic, and heat to seal products inside of the shrink film. The heat application process can be done via either a heat gun or a shrink tunnel. Packaging manufacturers like Seal-A-Tron produce shrink wrapping systems for industrial applications. A shrink-wrapped item will look something like this:

Image result for shrink wrapped product

In some cases, entire pallets of produce can be shrink wrapped to provide a form of product protection in transit and/or storage. However, most applications involve individual products, especially food products.

Stretch Wrapping

Stretch wrapping is the process of wrapping stretch film, a highly stretchable and elastic plastic film, around products. The elasticity of the stretch film pulls the products together and keeps them secure. This process is often performed with a turntable stretch wrapping machine like Orion’s Flex CTS Twin Station Stretch Wrapper, although many options are available for different user needs. A stretch-wrapped pallet looks something like this:

Image result for stretch wrapped pallet

This particular pallet was also strapped and equipped with corner board, a form of protective packaging, for optimal protection and security in transit and in storage.

Which One Should You Use?

This question is best answered by requesting more information from the R.V. Evans team. However, to get you started, a brief breakdown of a couple advantages and applications is shown below.

Stretch Wrapping Applications/Advantages Shrink Wrapping Applications/Advantages
· Wrapping boxes and pallets of products

· Cost-effective (particularly with pre-stretch)

· Protection from dust, dirt, and moisture

· Typically used to secure single products

· Best choice for food products

R.V. Evans Co. would be happy to provide you with any additional information you need at 1-800-252-5894 or via the website.