This paper examines the operation and performance of a lumber mill. Generating positive cash flow... more This paper examines the operation and performance of a lumber mill. Generating positive cash flow and remaining profitable at coincident low points of the economic and seasonal cycle are major challenges. Mill metrics were benchmarked using industry data which revealed performance gaps in costs, production rate, quality and lumber recovery. Economies of scale were investigated for lumber manufacturing. Capacity utilization for the site empirically determined that the unit was operating at close to its minimum cost, and this was an optimum operating level under poor market conditions. Opportunities to improve efficiencies and decrease waste through organizational changes, technological upgrading, and techniques of lean manufacturing are outlined. These changes raise the mill to a first quartile level generating positive cash flow at the bottom of the lumber economic cycle.
This paper examines the operation and performance of a lumber mill. Generating positive cash flow... more This paper examines the operation and performance of a lumber mill. Generating positive cash flow and remaining profitable at coincident low points of the economic and seasonal cycle are major challenges. Mill metrics were benchmarked using industry data which revealed performance gaps in costs, production rate, quality and lumber recovery. Economies of scale were investigated for lumber manufacturing. Capacity utilization for the site empirically determined that the unit was operating at close to its minimum cost, and this was an optimum operating level under poor market conditions. Opportunities to improve efficiencies and decrease waste through organizational changes, technological upgrading, and techniques of lean manufacturing are outlined. These changes raise the mill to a first quartile level generating positive cash flow at the bottom of the lumber economic cycle.
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Papers by Toomas Ruberg