Aerospace Suppliers

Problem:

As the global inventory of aerospace grade titanium raw material inventory shrinks, the costs of processing titanium is increasing. Without addressing the costs of processing these parts our profit margins will decrease and threaten the finical stability of our organization. As the global inventory of aerospace grade titanium raw material inventory shrinks, the costs of processing titanium is increasing. Without addressing the costs of processing these parts our profit margins will decrease and threaten the finical stability of our organization.

Solution

  • Purchasing – After implementing a purchasing strategy focused on standardization and cut size material, we’ve reduced our average inventory holding time by over 50% from 181 to 75 days. 
  • Internal and External Processing – Following the decision to move sol-gel processing in-house, we were able to reduce processing costs for 43% of our titanium parts. We expect once Skills has passed the learning curve for this new process, we will be able to process all titanium parts in-house at a reduced rate. 

Results

  • Planning – By incorporating a 5% cap on overage for all orders, our projected savings is $246,787.89 through mid-2019.
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