Published

Capacity up by 22% with a Facility Management Plan

CASE:

Customer

CLC, Portugal

The customer's challenge

The challenge for CLC was the decreasing LPG market, which forced the LPG retailer to reduce costs. CLC experienced considerable downtime due to a lack of proper maintenance and had an impending need to increase the productivity by revamping the plant.

Our solution

Our solution entailed a 360 degree plan. We assumed all tasks related to filling and maintaining cylinders, forklifts maintenance, calibrations and all the administrative tasks needed to run the plant.

The outcome

By upgrading the equipment and maintaining it regularly, the uptime increased considerably. The productivity of the CLC filling lines grew an impressive 22% amounting to around 7 million processed cylinders per year.

What is a Facility Management Plan?

To sign a KC Facility Management Plan with Kosan Crisplant means that KC assumes the responsibility of the production of a gas retailer in whole or in part and with or without reconditioning of the cylinders. Everything that happens inside the customer's site is managed by KC. That way, the customer doesn’t get any surprises in terms of unexpected expenses.

In a market like the Portuguese where the LPG demand varies and the use of LPG is decreasing, CLC wanted to pass as many production risks as possible to KC in order to guard his own business. Kosan Crisplant was able to assume those risks on behalf of the customer drawing on business' synergies in order to optimise the customer's production.

The challenge

In 2006, CLC was operated by a Kosan Crisplant competitor and the production efficiency called for an intervention. CLC needed a 180 degree turnaround and commenced a trusting partnership with KC. The challenge for CLC was the decreasing LPG market, which forced the LPG retailer to reduce costs. The customer's operators weren’t experts, and hence didn’t have a high level of knowledge about filling cylinders nor about maintaining the equipment. As a consequence, maintenance wasn’t carried out according to best practises, which in turn entailed considerable downtime.

Another challenge for CLC was the impending need to increase the productivity by altering some of the machines in the plant. However, in a decreasing market, it is hard to justify to a customer that investments are necessary. CLC knew that a revamp of the plant was required, but had no intention of buying the equipment, so CLC ended up renting it which turned a potential investment into a fixed, operational cost instead. This solution cut down costs for CLC and they were able to make the budget for the year.

The solution

Our solution entailed a 360 degree plan. Hence, we assumed all tasks related to filling and maintaining cylinders, forklifts maintenance, calibrations and all the administrative tasks needed to run the plant. In addition, the agreement included supplying of all kinds of consumables (such as soap, detergents and maintenance consumables) as well as spare parts supporting the customer in all his needs for his business. That way, the customer only has one point of contact for the entire plant and is still 100% covered.

In order to increase the capacity of the plant, we updated the technology in the filling machines. We also changed the palletizers and increased the quality of the end product by adding new leak detectors. In a filling plant, a lot of equipment needs to be legally calibrated, such as the check scales, the leak detectors or manometers. KC assumed all quality, environment and safety record management freeing the customer of tedious paper work.

Let KC select the optimal crew for your plant

Paramount for the success of the plant and for a smooth production flow is that we find dedicated, hardworking staff that performs well and that is aligned with our cultural understanding and the way we work. The job is physically and mentally challenging so we need people to be alert and to act responsibly at all times in order to avoid potentially dangerous situations when operating the machinery.

KC assumed the responsibility for all staff and their overtime to take out any worries the customer might have in this respect. With an FM plan, the customer pays per processed cylinder, not per employee thus eliminating any headaches about complicated pay and conditions of employment. Hence, the customer's advantage is in the budget - there are no fixed costs for e.g. pay roll.

This is an advantage if the customer all of the sudden needs to change the working conditions and production output. The customer is always on the safe side, relying 100% on an experienced back office that is fully focused on providing the best solutions and support for the customer.

We employed a job rotation system in which everyone rotates every hour within their skill set in order to never lose focus or have the strain of static tasks securing ergonomic positions at all times. We thus keep the staff level to a minimum and everyone has the skills and the knowledge to replace each other. That way, we don’t depend on any one person, so the production will never unexpectedly stop.

The outcome

By upgrading the equipment in the plant and maintaining it regularly and correctly, the uptime increased considerably. Naturally, when the plant runs more steadily without expensive downtime, the output is higher and the cost per cylinder decreases. The productivity of the CLC filling lines grew an impressive 22% due to the revamp and proper maintenance, and we increased the output by almost 1,000 cylinders. In addition, we freed staff to perform other tasks around the plant due to the optimised production. Now, CLC produces around 7 million cylinders per year.