Overview of the Cost Savings Program For a Global Pork Processor

HCO Innovations is a materials handling assessment company that provides comprehensive evaluations and solutions for your company’s forklift operations. We guarantee to reduce your overall expenses and costs while increasing operating efficiency and your profits.

During a 36-month term, HCO Innovations delivered $4,901,454 of cost-savings related specifically to a Global Pork Processor’s forklift/material handling fleets. Through collaborative and immersive efforts, we quantifiably increased productivity, reduced maintenance expenses, and lowered acquisition and/or monthly lease costs while dramatically improving overall safety. This fleet is on track to be the most optimized and productive in the clients’ history.

Scope of Services Provided

Each service HCO Innovations provided the Global Pork Processor was specifically developed and tailored to each facility, paying careful attention to today’s needs and tomorrow’s demands. Each service was managed as a standalone category, directed by an HCO Innovations Core Leader for the client.

Scope

  • All divisions, 40+ locations
  • 2,000+ various powered equipment assets
  • Interacted with 60+ personnel, including Plant Mangers, Controllers, Engineers, and Treasury

Field Engineering Assessments & Recommendations

  • 38 facilities visited
  • Handling efficiency / Types of Equipment Specifications to meet specific and unique handling requirements

Procurement programs & Lease structures

  • HCO Innovations’ efforts were supported by 25+ supplier representatives for material handling equipment, services, and allied products
  • Economic Justifications
  • RFPs

Fleet Right-Sizing Maintenance Programs Cost Tracking & Reporting Telemetry Monitoring & Reporting Greenfield Planning Power Grid Implementation & Management (Energy Cost-Savings)

  • Power studies for right solutions
  • Zero battery change where feasible – cost / safety / productivity
  • Fleet uptime through remote monitoring and maximized battery performance

Six-Pillar Strategy for Success

To achieve the cost-savings results of over $4.9 million, as well as safety and operational improvements within the Global Pork Processor’s operations, HCO Innovations developed and successfully implemented a strategic action plan centered on a Six-Pillar Strategy:

  1. Procurement / Leasing: Pricing negotiation strategies, reducing middleman costs, managing supply processes and documentation including economic/utilization analysis
  2. Utilization: PIT fleet rightsizing initiatives, including utilizing hour meter and cost data
  3. Maintenance: Standardizing maintenance agreement structures, developing RFP content
  4. Safety: Low and high tech solutions to avoid worker injuries and ensure OSHA compliance
  5. Reporting: Web-based access to assets to increase visibility and transparency, tailoring actionable reports and quarterly management meetings to discuss savings progress
  6. Energy & Power Management: Measuring and reporting energy and power consumption, designing and implementing high-efficiency solutions to reduce costs

Implemented Programs & Savings

Throughout the 36 months of the agreement, HCO Innovations implemented cost-savings programs and kaizen initiatives throughout many of the Global Pork Processor’s operations, yielding annual cost-savings
of over $1.6 million.

Location Annual Savings One-Time Savings Activity
1 $178,750 Fleet replacement / battery and charger pricing program
2 $78,000 Fleet replacement
3 $114,068 Fleet replacement
4 $65,000 Quarterly replacement plan
5 $458,000 Complete fleet replacement (104 pieces to 89) / Power solution
6 $228,000 Usage program on pallet jacks / Opportunity charging
7 $57,000 Reduced equipment count / Power program
8 $28,000 Equipment replacement – Lease and maintenance
9 $87,000 Complete fleet replacement
10 $12,000 Equipment replacement (29 pieces to 20)
11 $308,000 Complete replacement (47 pieces to 32) / Zero battery charge
12 $60,000 One walkie stacker each location / Purchased / Ongoing additions
13 TBD Complete replacement (60 pieces to 47) / Power solution
$1,613,818 $60,000
3 1 Minimum Term on all Projects is 3 years
$4,841,454 $60,000
$4,901,454 TOTAL SAVINGS FROM IMPLEMENTED PROGRAMS

HCO Innovations – Core Leadership

Team Our Core Leadership Team is a multi-faceted, well-rounded, dynamic group of industry experts. Each leader has significant industry expertise, from Fortune 500 Manufacturing and Distribution organizations to Wall Street financial institutions. Each Core Leader directs a team of talented industry experts, including industrial engineers and data analysts.

The following table lists the Core Leadership Team from HCO Innovations for the Global Pork Processor in alphabetical order, including each leader’s expertise and years within the material handling industry.

HCO Innovations Core Leader Food Warehousing & Distribution Material Handling Equipment Financial Management Operations Management Industrial Power Management Negotiations Industry Tenure (YRS.)
Michael Bumarch 30
Neil McElroy 16
Matt Orn 10
Will Van Ness 16
Phil Watson 30

  Core Expertise and Area of Primary Responsibility
  Secondary Area of Expertise

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