Switching from corrugated cartons to returnable packaging trays has saved this alternator manufacturer $425,000 annually.  

Nearly 130,000 heavy-duty truck alternators ship every year from the Arcade, N.Y. manufacturing facility of the Leece-Neville division of Prestolite Electric. The company sends them to a distribution center in Lexington, Ky. where they are re-packed for shipment to original equipment truck manufacturers, engine producers, and after-market re-sellers.

As the company now knows, it was wasting $425,000 a year in packaging costs. Today, alternators are sent in resuable bulk shipping trays made from a recycled wood-fiber material (Homasote Co., 800-257-9491, www.pakline.com).

Previously, Leece-Neville shipped the alternators from the factory to the D.C. in individual corrugated cartons that had an insert of reinforced fiber for cushioning. Each container cost the company about $2.00 and was simply thrown away after one-time use. The company then tried shipping the alternators in large corrugated cartons measuring 33 x 42 x 20 inches. This method also proved too costly and made handling much more difficult.

Die-cut notches in the new, recycled wood-fiber trays fit each of the 450 different alternator models Leece-Neville produces. First a pallet skid is laid down and a tray is placed upon it. Then 16 alternators are loaded into the notches on the tray. Another tray is fitted on top, with more alternators placed upon it. A total of six tray layers are built and then wrapped with disposable strapping. They are then trucked to the distribution center where the alternators are repackaged for customers. Empty trays are gathered and shipped back to New York. Leece-Neville currently has 4,000 trays in its returnable loop.

In addition to tremendous cost savings, Little says that the new packaging system also provides improved ergonomics. Before, workers had to lean across the vertical walls and down into the large corrugated cartons to place and remove the alternators. The flat, open design of the trays makes it easy to pick up the alternator units without strain. Lift tables are additionally used to maintain the layer currently being worked on at a comfortable height.

"Packers can reach directly into the center of the tray now without bending down," adds Little. "We cut our loading requirements from two employees to one."

Each load of six trays holds double the alternators that could be accommodated on each skid of the corrugated system – 80 versus 40. This maximizes the cube of each truckload. Leece-Neville has also eliminated the need to dispose all of the used corrugated since the trays are reusable. Little adds that most of the trays in his loop have now made about 60-70 trips, and he expects them to last several more years until they need to be replaced.

"It is an extremely cost-effective way for us to obtain a custom package and dunnage system," he says.