Source: The Sunday Challenger

By Michael Rovito
The Sunday Challenger
feedback@challengernky.com

Slimming Companies' Shipping Costs


Submitted photo
WAY TO GO: LeanCor employees Jennifer Ridner and Vimal Patel plot suppliers on a U.S. map to establish potential distribution routes.

FLORENCE - After more than a decade in the transportation, consulting and third-party logistics business, Robert O. Martichenko had a vision, a lean vision.

"I have been doing a lot of work over the years in lean manufacturing," Martichenko said of his work in a relatively different style of shipping logistics.

Martichenko resigned from his job and set out last year to start a company that would take over the responsibilities of shipping from a manufacturer and implement the lean manufacturing style.

In January, LeanCor was born.

Going Lean

The lean style is the process of eliminating all waste in a manufacturing company by streamlining and simplifying shipping.

Three key tools, according to Martichenko, make for a successful lean style: increased frequency of deliveries, reduction of lot size for those deliveries and leveling the flow of material in a plant throughout the week.

"Over-production is a big problem in companies. They pay too many people to do too much when it could be leveled off," he said.

LeanCor specializes in applying what Martichenko knows about lean manufacturing to other companies in need of better shipping strategies.

"Companies that are not embracing lean manufacturing are spending so much time (on shipping) they are not competitive in their market place," said Martichenko.

Based in Florence, only four employees currently staff the company, which Martichenko said has hit roadblocks, as most new businesses do.

"When you are a small company in our field you have to provide 24-hour, seven-day-a-week coverage," said Martichenko. "Now we are an extension of shipping companies, if we make mistakes a whole line can shut down. It's made for some long days."

Currently, day-to-day activities at LeanCor revolve around "consulting projects and daily operations with one of the first companies to sign on with LeanCor, Maytag," said LeanCor Director of Operations Kevin von Grabe.

LeanCor handles Maytag's ordering and logistics for 15 suppliers in the Chicago area.

"We're utilizing trucks better than what they were doing," said Martichenko.

Besides Maytag, LeanCor is working with Dupont and DNR Technologies, a Chicago-based automotive supplier.

"Heart of the Midwest"

Martichenko, co-author of a book on lean manufacturing and a member of the editorial advisory board of Logistics Quarterly magazine, said Florence is where he wants LeanCor to stay because of its proximity to the manufacturing belt of America. Being near Interstate 75 is another advantage because, as Martichenko sees it, it's the manufacturing corridor from Toronto to Atlanta.

"Florence is a fantastic place to be because it is in the heart of the Midwest, which is a major shipping center of America," said Martichenko.

Not only does he want to stay in Florence, but Martichenko also said he wants to work with companies in the area to make local businesses prosper as well as the big name companies.

"We want to start developing relationships with local Northern Kentucky manufacturers to help them consolidate their volume," Martichenko said. "We want them to have their logistics systems be like big companies like Toyota."

Martichenko knows all about how Toyota's shipping system works because he set up the inbound logistics at Toyota Motor Manufacturing in Indiana. He also said he knows that same style can happen here with local companies.

"When smaller companies come together to consolidate their shipping, it will make for a more efficient and cost-effective system," Martichenko said.

Manufacturers with similar products can work together, under the lean manufacturing principle, to cut costs by merging their shipping activities. And that is just one goal of LeanCor.

Being the founder of a new company, Martichenko said he has more goals, short-term and long-term, each of them having to do with building a presence in the industry.

"We want to build and develop a lean supply chain company... and service customers where they need us to go," Martichenko said.

For the long term, Martichenko is thinking beyond Florence and hopes that in five years LeanCor can have 100 salaried employees.

"Our long-term goals are to build a substantial company, global in nature," he said.