Posie Packer


Assembling Bouquets

A bouquet manufacturer making about 15,000 bouquets per week, about 3000 per day, employing four experienced full time staff, receives an unexpected order on Monday at 9:00 a.m. for 2000 rainbow mini carnation bouquets from one of his most important customers. Apparently the farm bouquets the mass merchandiser purchased had terminal quality problems. Delivery is expected by Tuesday morning at 9:00 a.m. at the warehouse. The recipe calls for six stems of minis, a minimum of four colours per bouquet, and a stem of leather. Product is available to make the order. The pack size is 20 bouquets per case. The question is can he fill the order without  jeopardizing the regular weekly volume.

Background Information
Labour cost is about $10.00 per hour including benefits. The sleeve for this bouquet is clear polypropylene, costs 6¢ each and thank goodness the right size is in stock.

Manual Assembly

Productivity from past experience shows that his employees can make this bouquet at about 50 bouquets per person per hour with each individual employee making the bouquet, tying it, dropping it into a sleeve, doing the final trim with a guillotine and placing it in a bucket. Total man hours required 2000/50 = 40 /4 employees = 10 hour day - labour cost per bouquet is 20 cents.

Posie Packer Bouquet Organizer

Productivity using this mechanical aid, increases by 50% to 75 bouquets per person per hour, 3 people are assembling the bouquets and one person tying them, using a mechanical tyer, and dropping them into a sleeve, then putting 20 in a bucket. The organizer does the final trim cut. Total man hours required 2000/75 = 26.67 hours /4 employees = 6.67 hours - labour cost per bouquet is 13 cents

Posie Packer Automatic Wrapper

Productivity using this mechanical aid increases to 125 bouquets per person per hour, 3 people are assembling the bouquet and one person is sealing the bottom of the bouquet and putting them in water. Since the machine makes its own customized sleeve on demand, the sleeve is always the right size and it's cheaper. The machine does the final trim cut. Total man hours required 2000/125 = 16 hours / 4 employees = 4 hours - labour cost per bouquet is 8 cents.

Analysis

Under the manual system it is doubtful whether the order can be handled. The regular volume will be in jeopardy. The order means that it will be a 10 hour day for the employees, and their productivity will decline especially in the last 2 hours. The only alternative is to bring in temporary help on short notice with all the related problems associated with this option such as training etc.

The Posie Packer Bouquet Organizer represents an alternative that makes it possible to do the order in about 7 hours but what about the regular weekly volume of 15,000 bouquets (3000 per day) ? Short term, temporary help will still be required.

The Posie Packer Bouquet Wrapper represents an alternative that makes it possible to do the order in about 4 hours. The regular daily volume of 3000 bouquets is not in jeopardy - just a little overtime.

Conclusion

If the assumption is made that the increases in productivity are similar for a wide range of bouquets and that volume is 15,000 bouquet per week, the following mechanical aids offer the following potential savings for this bouquet manufacturer on a weekly or yearly basis:

Manual labour cost per week is 15,000 x .20 = $3,000.00

The organizer option labour cost is 15,000 x.13 = $1,950.00 - labour savings $1,050 /week or about $54,600 per year

The wrapper option labour costs is 15,000 x .08 = $1,200.00 labour savings of $1,800 /week or about $93,600.00 per year. There would also be savings in the sleeves. The machine makes the required sleeve at a cost of about  4 cents per sleeve - savings per week of 15,000 x .02 = $300.00 per week or $15,600.00 per year. Total yearly savings would be about  $93,600 + $15,600 = $109,200.00 per year.

The mechanical aids taps the hidden profits that already exist in the business. If the savings were to be translated into sales dollars, assuming 10% gross profit, then every dollar of savings represents a $10.00 sale with these key advantages:
  • You  will be paid instantly
  • You will never loose this account to a competitor