lean manufacturing UK

Kanban on a Shoestring: Two Bin Replenishment Without Buying a New ERP

Posted on by Adam Payne

Somebody has sent you a quote for £60,000. Maybe it arrived on a Monday morning, about ten minutes after you found out that a line had been standing idle waiting for a box of M8 washers that cost less than the biscuits in the meeting room.

I’ve been in that room. Not the same one, obviously, but close enough. I’ve walked into more stores cages than I care to count where a perfectly capable team was losing hours every month to parts worth pennies, and where the proposed fix was a piece of software with a project plan, a data migration and a go live date that everybody quietly assumed would slip.

I want to be fair here. An ERP can be a very good thing. If you need proper bills of materials, job costing, traceability and one version of the truth across sales, purchasing and finance, it might be exactly what your business needs, and £60k isn’t a silly number for it. But that’s not the problem that landed on your desk this morning. The problem is that things run out. Cheap, boring, everyday things.

For that specific problem, there’s a method that’s older than most ERP vendors, needs no software and can be running on your shop floor by the end of next week. Two bins and a card.

This is a practical build guide. We’ll cover which items are worth putting on it, how to size the bins, where the card should live, and what to do in the first month when, and I’ll be honest with you, people will forget. They always do. It’s fine. It’s part of how you get there.

Why a £60k system might be answering a different question

Start with the money, because it matters. For a UK manufacturer with somewhere between ten and fifty people, one buyer’s guide puts a realistic first year budget at £20,000 to £100,000, depending on how complicated the operation is. So your quote isn’t outrageous. It’s just a lot of cash to spend on something that may not touch the actual problem. FactoryIQ

Then there’s the risk side. One 2026 analysis of discrete manufacturing projects (written by an ERP consultancy, so take it with a pinch of salt) reports that around 73 per cent fail to meet their objectives, with average cost overruns of 215 per cent. I wouldn’t tattoo those numbers on your arm. But I’ve seen enough go lives to know the direction of travel is about right.

Here’s what I’d want you to think about. Most stockouts on most shop floors don’t come from a shortage of software. They come from cheap consumables and small components that nobody has been asked to watch. Fasteners, gaskets, abrasives, sleeving, labels, cable ties, that sort of thing. And an ERP only knows what’s on the shelf if somebody books stock in and out. Picture how likely that is for a bag of washers at half past two on a Friday afternoon. Yes. Exactly.

That’s the quiet flaw in using a system to fix a discipline problem. The software’s reorder point is only as good as the stock count underneath it, and the stock count for low value parts is usually the least accurate number in the building. A two-bin system sidesteps the whole thing. There’s no transaction to forget, because the empty bin is the transaction.

None of this is new, either. Taiichi Ohno developed pull replenishment at Toyota, and the kanban card owes a good deal to the older two bin method, where emptying the first bin sends a card to purchasing. You may have heard the story about Ohno having a lightbulb moment in an American supermarket. Apparently, that’s a bit tidier than the truth. His 1956 trip was a business visit to study car plants and equipment suppliers, with the supermarket as a side trip. I quite like that, actually. The idea didn’t need a grand moment of inspiration. It just needed somebody to notice that an empty container is already a perfectly good message.

Which items qualify (and which really don’t)

You won’t put everything on this system, and you shouldn’t try. Not every part in your building deserves the same treatment.

The tidy way to think about it is ABC analysis. Rank your parts by annual spend, and you’ll usually find that the C items, the cheap ones, make up about half of your part numbers but only five to ten per cent of the value. Those are your candidates. They’re the parts that cause the most nuisance and tie up the least cash.

You don’t need a system to work this out. Export twelve months of purchase lines from Xero, Sage or whatever you use. Multiply unit price by quantity, sort from highest to lowest, and look at the bottom half. That’s an afternoon’s work at most, and I’d say it’s less if you’re comfortable with a spreadsheet.

But there’s a better filter than the spreadsheet, and it’s free. Ask your supervisors and your buyer one question: what did we run out of in the last six months? The list writes itself in about ten minutes. The best candidates are usually the parts people already swear about.

Then run each candidate through five quick tests.

  1. Steady demand. It gets used most weeks, in roughly similar amounts. If it’s used in a burst once a quarter, it’s not a two-bin part.
  2. Low value per unit. A spare bin of them shouldn’t make your finance director wince.
  3. Short, dependable lead time. Your supplier delivers in days, not weeks. Catalogue items from a wholesaler are ideal.
  4. Physically binnable. It fits in a tote, a box, a bag or a marked shelf space you can point at.
  5. Used in a known place. One or two locations, not scattered across three buildings.

And what doesn’t qualify? Anything engineered to order. Anything with a long or unpredictable lead time. Expensive components where holding a second bin is a real cash decision. Project driven parts that spike with a big job. And anything where you need batch traceability, because two bins won’t give you that. Those parts need proper records, and that might be where a future ERP genuinely earns its money. I’m not being dogmatic about it. Kanban isn’t a religion.

Now the bit people always want to skip. Don’t start with all four hundred C items. Pick a handful. Most guides suggest piloting on a small number of parts before rolling it out across the warehouse, and I agree completely. I’d say fifteen to twenty-five items is about right. Include a few of the ones that hurt most, so people see the benefit quickly, and a few boring ones that will work first time and build a bit of confidence. Those early wins matter more than you’d think.

Sizing the bins without needing a degree in statistics

The maths is gentler than people expect. The logic goes like this: when the front bin runs out, the reserve bin has to keep you going until fresh stock arrives. So the reserve needs to cover your daily usage multiplied by the time it takes to get replacement stock, plus a bit extra for when things go wrong. Most guides boil it down to daily usage times lead time, plus safety stock.

I’d tweak that in one small way. Lead time isn’t only your supplier’s delivery time. It’s everything between the bin emptying and new stock being on the shelf, and that includes the time the card spends sitting in a tray waiting for someone to notice it. So here’s the version I’d actually use:

Bin quantity = daily usage × (your own delay + supplier lead time in working days) + safety stock

Let’s make it real. Say you use stainless M8 bolts at about 60 a day. Your supplier delivers three working days after you order. Your own delay, the time between the bin emptying and the buyer placing the order, is about a day. That’s 60 × 4, which is 240. Add 25 per cent for safety, which is another 60, and you get 300. The supplier sells in boxes of 100, so that’s exactly three boxes per bin. Lovely. Rare, but lovely.

If it doesn’t divide that neatly, and it usually won’t, round up to the nearest whole pack. A bin that’s slightly oversized costs you pennies. A stockout costs you an hour of a line.

Now, where does the daily usage number come from? There are two routes. The careful one is to track real usage for at least two to four weeks before you fix any quantities. Count what goes out, or count empties, or ask the operators to tally on a bit of paper stuck to the shelf. The lazy but surprisingly decent one is to take your annual purchased quantity from the purchase ledger and divide it by the working days you actually run. For most UK sites that’s somewhere around 225 once you take out weekends, bank holidays and leave. It won’t be perfect, but it’ll be closer than a guess, and a lot closer than what most people put in an ERP’s reorder field.

For the safety margin, I’d go 25 per cent for reliable suppliers and up to 50 per cent for patchy ones. And in month one, lean towards too big rather than too small. You can trim later once you’ve got real evidence.

Then run one last sanity check. The time it takes to get through a bin has to be longer than the time it takes to reorder and receive replacements, otherwise the second bin could run dry before new stock arrives. In our example, 300 bolts at 60 a day lasts five days against a four-day replenishment loop. That gives you one day of breathing space. Good.

Two practical points that catch people out. First, check the bin can physically hold the quantity. I’ve seen beautifully calculated numbers that needed a bin the size of a wheelie bin. If it doesn’t fit, use a bag, a marked shelf, or a bigger container, or reconsider whether it belongs on the system at all. Second, watch out for minimum order quantities. If your supplier only sells 1,000 at a time, your bin size might need to be 1,000, and now it’s a different conversation about cash and space.

Sanity check the cash too. Three boxes of bolts at around 9p each is £27 of stock per bin, so £54 across the pair. For genuinely cheap C class parts, the total stock you’re holding is usually a small number. Do the sum for your own list. It’s a useful moment, to be honest, because it shows just how little money is tied up in the things that stop your line.

Where the card goes, and why it’s the whole system

The bins get all the attention. But the card is the actual system. The card is the message. If it goes missing, you’ve just got two boxes on a shelf and a false sense of security.

On the card itself, keep it plain. You want the part number and a description in the words your team actually uses, not the catalogue’s. Add the supplier and their product code, the bin quantity and pack size, the lead time, where the part lives, who orders it, and the date the size was last reviewed. Colour code it by supplier or by buyer if you can. Laminate it or slip it in a clear pocket, because shop floors are grubby places and paper doesn’t last a week without help.

Here’s the loop, and I’d suggest pinning it up where everybody can see it:

  1. The operator uses up the front bin.
  2. They pull the card and drop it in the collection point, then slide the reserve bin forward.
  3. The buyer collects cards at set times, orders one bin’s worth, and moves the card to an “on order” board with the date written on it.
  4. When the delivery arrives, goods in refills the empty bin and puts the card back on it.
  5. The refilled bin goes to the back of the shelf and becomes the reserve.

Now, where does the card physically sit? For small loose parts, my favourite is at the bottom of the front bin. It’s revealed the moment the last item is taken, so nobody has to remember anything. The empty bin practically announces itself. For bulkier items, where a card in the bottom would get buried, use a clear pocket on the shelf edge or the front face of the bin.

The collection point matters as much as the card. Put it somewhere people walk past anyway. A clear wall pocket at the end of the aisle, a small letter tray by the stores hatch, something like that. Not on the buyer’s desk in the office. Every step you add between the empty bin and the buyer is another place the card can quietly die.

The “on order” board is worth the ten minutes it takes to make. Two columns will do, “to order” and “on order”, with the date the order went in. When a card has sat under “on order” for longer than the lead time, it’s obvious. You’ll spot a late delivery before your operators do, which is a nice change.

Then think about your buyer’s rhythm. If cards get collected at nine and two every day, your own delay in the formula is roughly half a day to a day. If they get collected on Fridays, it’s a week, and every bin you sized needs to grow. This is the sort of detail that quietly wrecks a system that looked perfect on paper.

And here’s the honest weakness. A paper card can be dropped, borrowed or wiped, and an empty bin nobody actioned looks the same as a full one until the line starves. That’s true, and I’d rather you knew it now. The method is sound. The card carrying it is fragile. So build in one simple rule: a bin without a card is a red flag, and a card without a bin is a red flag. Then have the owner do a two-minute walk of the pilot area each day for the first few weeks, looking for exactly those two things.

The first month: what to do when people forget

People will forget. I say that with real affection. It isn’t laziness, it’s just that you’re asking a busy team to change a habit they’ve had for years, and habits are stubborn.

I remember helping a site where the cards kept vanishing. Somebody would find an empty bin, no card, and the buyer had no idea what to order. We spent a week suspecting sabotage, or at least a mild lack of enthusiasm. It turned out they were being taken home in overall pockets and going through the wash. We switched to cards fixed to the bin with a cable tie and the problem stopped inside a day. Nobody had done anything wrong. The system had just made it easy to walk off with the card.

That’s the mindset I’d encourage. When something goes wrong, don’t ask who forgot. Ask what the system made easy.

Before you start, give it an owner. A name, not a department. The advice from people who’ve done this is blunt: without a clear owner, the system collapses the first time somebody goes on holiday. Decide who checks the cards, who orders, and who covers when they’re away. Write it on the board.

Then here’s roughly how I’d shape the first four weeks.

Week one: sit with it. Walk the pilot area twice a day. Most problems show up on day two, and they’re usually small and slightly embarrassing. A bin in the wrong place. A card with a typo in the supplier code. A reserve bin that’s actually half empty because it was never filled properly at the start. Fix things on the spot and thank people for pointing them out.

Week two: resize. By now you’ll have a few real cycles of data. Some bins will be too small (you’ll know, because you nearly ran out) and some too big (because they haven’t moved in ten days). Adjust quantities and update the cards. This is the week that turns a guess into a system.

Week three: deal with the awkward bits. Holiday cover, night shift, agency staff who weren’t there for the briefing. This is also when the odd behaviours emerge, so watch for them. There are usually four.

Someone slides the reserve bin forward but leaves the card on it, so the buyer never sees it. Someone tops up the front bin from the reserve “to be helpful”, which quietly destroys the safety margin. Someone borrows a bin from another station and doesn’t bring it back. And the buyer, quite reasonably, batches cards until Friday because that’s when the orders go out anyway.

None of these is a disaster. Each one tells you where the design needs a small fix. Perhaps a sign on the shelf saying, “never top up from the reserve”, or a fixed collection time agreed with purchasing.

Week four: count and decide. Before you make any decision about expanding, gather three simple numbers. How many stockouts happened on the pilot items, compared with the month before? How many emergency or expedited orders did you place? And roughly how many minutes did your buyer spend chasing these parts? A tally sheet on the wall is plenty. You’re not building a dashboard. You’re just trying to have an honest conversation with some evidence in it.

If it’s worked, and in my experience, it usually does, add the next batch of items. If parts of it didn’t, you’ll know exactly which parts, and you’ll have spent a few hundred pounds finding out rather than sixty thousand.

Bringing it together

Two bins and a card won’t run your business. It won’t cost your jobs, schedule your machines or give you traceability on a critical component. It isn’t meant to.

What it will do is solve one specific, expensive, irritating problem, which is running out of cheap things. It works because the empty bin is the signal, so there’s no stock count to get wrong and no transaction to forget. You pick items that suit it, mainly steady, low value parts with short lead times. You size the bins using daily usage, a realistic lead time (including your own delay) and a sensible safety margin. You put the card where it can’t quietly disappear. And you give it a named owner and a month of patience while people find their feet.

If you still want an ERP after that, good. It’s a perfectly reasonable thing to want. But you’ll be buying it for the right reasons, to handle the complicated parts of the business, and you’ll have taken the daily nuisance of washers and cable ties off its plate. In fact, a well-run kanban loop for your C items can sit happily alongside a future system, doing the boring job it does best.

So here’s what I’d do this week. Ask your supervisors what you’ve run out of since March. Pick fifteen of the worst offenders. Do the sums on a single sheet of paper, buy a few dozen bins and a pack of card, and try it for a month. If it doesn’t work, you’ve lost very little. If it does, you might just find that the £60k conversation gets a lot shorter, and a lot more interesting.

Want a hand setting this up?

Reading a build guide is one thing. Putting it into practice on a busy shop floor, with real suppliers, real deadlines and a team who already have full-time jobs, is another. I know that.

If you’d like some support, we can do as much or as little as you need. We can walk your stores with you and choose the right pilot items, size the bins from your own purchase data, design the cards and the collection point, and stay involved through that awkward first month when people forget. There’s no software to buy and no six-month project plan to sign off. The aim is a working pilot on your shop floor within a couple of weeks.

If you’d like to talk it through, book a no obligation call with one of our team. Bring your list of things you keep running out of. That’s usually all we need to get started.

Cost of Quality Failures: A Practical Guide for UK Manufacturers

Posted on by Adam Payne

Picture the scene. You walk past the scrap bin on a Friday afternoon, more out of habit than curiosity, and you clock what’s sitting in it. Maybe you weigh it. Maybe you just eyeball it and do the maths in your head based on last month’s average cost per kilo. Either way you land on a number. Let’s say it comes to £5,000 for the month. Not brilliant, but not a crisis either. You mention it in the ops meeting, someone nods, and everyone moves on to the next item on the agenda.

Here’s the bit that catches most manufacturers out, and to be honest it caught me out too the first time someone walked me through it properly. That £5,000 isn’t your cost of quality failure. It’s not even close. It’s the bit you can see, weighed and priced at raw material cost, sitting in a skip by the loading bay. Everything that actually caused that scrap to exist in the first place, the machine time burned re running the job, the hours your best people spent sorting good parts from bad, the courier you paid extra to get a replacement batch to a customer by Thursday morning, none of that is in the bin. It’s scattered across half a dozen different cost codes, buried in overtime sheets, filed under “administrative time” on a job card, or in a lot of cases just never recorded anywhere at all.

Add it all up properly, and most plants find their real monthly figure sits three to five times higher than what they originally thought it was. Not because anyone’s hiding it on purpose. Just because nobody’s actually adding it up.

This matters more than it used to. Whether you’re running a job shop in the Midlands, a fabrication plant in the North West, or a small assembly operation anywhere else in the UK, margins are tighter than they’ve been for a while, and a hidden cost running at three or four times what you assumed is not a small thing to have sitting undiscovered in your numbers.

So that’s what this piece is for. We’re going to look at why the gap between the visible number and the real one exists, what’s actually hiding inside it, and then walk through a simple way to build a proper monthly figure for your own plant using numbers you probably already have sitting somewhere in your systems. By the end of this you should be able to sit down for twenty minutes with a spreadsheet and come out with a number that’s a lot closer to the truth than whatever’s written on the scrap sheet.

Why the scrap bin only tells you half the story

There’s a reason quality people keep reaching for the iceberg analogy. The bit above the water, the scrap, the obvious rework, the returned batch, is the bit everyone can see and everyone feels comfortable reporting. It’s tidy. You can weigh it, price it against your bill of materials, and put a clean number on a slide.

The trouble is the iceberg analogy actually undersells it a bit, because most icebergs sit roughly seven eighths underwater, and in plenty of the plants I’ve looked at over the years the hidden portion of quality cost runs even bigger than that relative to what makes it onto a report. Industry research puts the total cost of poor quality somewhere between five and thirty five per cent of sales revenue for manufacturers, with a lot of studies settling around fifteen to twenty per cent as a rough working average. Now compare that to scrap and rework on their own, which tend to sit somewhere under three per cent of revenue even at weaker performing sites. The gap between those two figures is where all the genuinely interesting stuff is hiding.

Why does it stay hidden for so long? Mostly it comes down to where the money actually gets spent, and how disconnected those places are from each other. Scrap sits neatly inside a manufacturing cost centre. Rework labour often gets coded as ordinary production time if nobody’s bothered to track it separately, because from the operator’s perspective they’re just doing their job. Expedited freight lands inside the logistics budget under something generic like “delivery costs,” with no note attached explaining it was a rush job caused by a batch that failed inspection three days earlier. The quality engineer’s Tuesday spent writing up a corrective action report doesn’t show up as a cost anywhere at all, it’s just treated as part of what a quality engineer does. None of it gets flagged as quality cost, because none of it is labelled that way anywhere in your finance system. They’re just costs, spread thin enough that nobody ever connects the dots between them.

I’ve sat in more than a few production meetings where this plays out almost exactly the same way. Someone flags that the scrap number’s up again this month, there’s a short discussion about the supplier, or the operator, or a machine that’s drifting out of tolerance, and then everyone moves on. What almost never happens is someone standing up and saying, right, but what did that actually cost us once you factor in the four hours we lost re running the job and the taxi fare we paid to get parts to the customer on time. That conversation just doesn’t happen, mostly because the information needed to have it properly isn’t sitting in one place for anyone to look at.

And to be fair, that’s not really anyone’s fault. Finance systems are built to track cost centres, not causes. It takes a deliberate effort to pull the threads back together into one figure, and most plants simply haven’t built that habit yet.

The six numbers hiding behind your scrap figure

Let’s break down what’s actually going on when a batch fails, because once you see it laid out properly it’s genuinely hard to unsee.

  1. Material cost. This is the one you already know, and it’s the easy part. Raw material, purchased components, whatever went into the parts that ended up in the bin, priced at what you paid for it. It’s probably already sitting in your ERP system somewhere, tagged to a scrap transaction, assuming your system is set up reasonably well.
  2. Machine time. Every hour a machine spends running a job that ends up scrapped, or re running a job because the first attempt failed, is an hour that machine wasn’t available for anything else. Price that time at your fully loaded machine rate, the figure that covers depreciation, power, maintenance and everything else, not just the labour standing next to it. If a job normally takes four hours and you end up running it twice, that’s four extra hours gone, and on a line that’s already busy that’s not a trivial number to lose.
  3. Labour. Rework hours are the obvious one here, someone physically fixing or sorting parts, priced at a proper loaded rate that includes national insurance and other overheads, not just the basic wage. But don’t stop there. Think about the time spent writing the non conformance report, sitting in the root cause meeting, making the supplier call, chasing the corrective action afterwards. That’s all real, paid labour time, and it’s rarely coded anywhere as quality failure cost.
  4. Re inspection. When something fails, you almost always end up inspecting more afterwards, either the reworked batch itself or the next few batches while everyone’s understandably nervous. That extra checking has a real cost, in hours and often in equipment time too if you’re tying up measurement kit that could be doing something else. It’s a cost that only exists because the process let you down once already and nobody quite trusts it yet.
  5. Expedited freight. This one’s a personal favourite of mine because it’s so easy to miss and genuinely painful once you total it up properly. A batch fails, the customer still needs their parts on time, so you pay for next day courier instead of your usual pallet network, or you fly something in rather than shipping it by sea. That premium, the difference between what you’d normally have paid and what you actually paid, is a direct consequence of the quality failure. I’ve seen individual incidents where the expedited freight bill on its own was bigger than the material cost of the scrap that caused it in the first place.
  6. Lost capacity. This is the big one, and it’s the category most plants leave out entirely. Every hour spent on rework or re running a failed job is an hour you didn’t spend making something you could actually sell. Value that lost time not at your machine rate, but at what that capacity would have earned you in contribution margin had it gone towards good saleable output instead. On a line that’s already running close to full capacity, this figure can dwarf everything else on the list, because you’re not just paying for the mistake, you’re also losing the profit you would otherwise have made in that same window of time.

A quick word of caution before you go filling in your own numbers. Machine time and lost capacity can overlap if you’re not careful, since they’re both really about the same lost hours, just viewed through two different lenses, one as a direct cost, one as an opportunity cost. Pick one lens for those specific hours and stick with it, or you’ll end up counting the same time twice and your final figure will look inflated rather than genuinely honest. Better to be conservative and defensible here than impressive and wrong.

Building your own number, step by step

Right, let’s actually do this. Grab a notebook, or better still, open a spreadsheet, because this is something worth keeping and repeating every month rather than doing once and filing away.

Step one. Total material scrapped this month, priced at cost. This should already exist somewhere as scrap transactions in your system. If it doesn’t for whatever reason, your finance team can usually pull it from stock write offs without too much trouble.

Step two. Machine hours lost to failed runs and re runs this month, multiplied by your fully loaded machine rate. If you don’t know that rate off the top of your head, ask finance. Most plants already have it calculated somewhere for costing purposes, even if nobody’s shown it to you directly before.

Step three. Labour hours spent on rework, re inspection, and quality admin, meaning non conformance reports, root cause work, and corrective actions, multiplied by your loaded labour rate. Be honest with yourself here. If your quality technician spent six hours on paperwork because of one bad batch, that’s genuinely six hours, even if it doesn’t feel like it at the time.

Step four. Extra freight cost this month, meaning the difference between what you’d normally pay to ship something and what you actually paid because it needed rushing. Your logistics team or your finance system should have this if you ask the right question, which is usually something like “what did we pay above standard rates this month, and why.”

Step five. Lost capacity hours, valued at contribution margin per hour rather than machine rate, remembering the double counting warning from the last section. If you’re not sure of your contribution margin per hour, it’s roughly your average selling price per unit minus your variable cost per unit, multiplied by units produced per hour on that particular line.

Add all five together and you’ve got your real monthly cost of quality failure.

Let’s run through it using the numbers from the start of this piece, just to make it properly concrete rather than abstract. Say your scrap bin comes to £5,000 for the month, material cost only, exactly like the example we opened with. Rework and re inspection between them come to ninety hours this month, and at a loaded labour rate of around £26 an hour that’s £2,340. Machine time lost to re running failed jobs comes to thirty five hours at a fully loaded machine rate of £38 an hour, adding another £1,330. You had three shipments that needed rushing this month to cover replacement batches, adding £650 above what you’d normally have paid for standard delivery. And your lost capacity, the hours that could have gone towards saleable output instead, comes to around £9,000, based on sixty hours of lost production time valued at roughly £150 an hour in contribution margin.

Add it up. £5,000 plus £2,340 plus £1,330 plus £650 plus £9,000 comes to £18,320 for the month.

That’s not £5,000. That’s a little over three and a half times higher, and honestly this is a fairly conservative example. Plenty of plants, especially ones with tighter margins per unit or more complex, longer running products, land at four or even five times their scrap figure once everything’s counted properly. If your own number comes out lower than that once you’ve done the exercise, it’s worth going back and double checking you’ve genuinely captured all five categories rather than quietly assuming your plant is somehow the exception to a pattern that shows up almost everywhere else.

What you do with the number once you’ve got it

Getting to a proper figure is only useful if it actually changes something afterwards. So what do you do with it once it’s sitting in front of you.

First, use it to build the business case you’ve probably struggled to make before now. Telling your finance director you want another inspection point, or a bit of preventive maintenance budget, or time for the team to do proper root cause work instead of constantly firefighting, lands very differently when you can say “our quality failures are costing us eighteen thousand pounds a month, and here’s exactly where it’s going” rather than “scrap’s felt a bit high lately, to be honest.” Numbers with a clear breakdown behind them get taken seriously in a way vague concerns just don’t.

Second, track it monthly rather than treating this as a one off exercise you do once and forget about. The real value isn’t in the single number, it’s in the trend underneath it. Is it going up or down. Which of the five categories is moving and which is staying flat. If your material scrap stays roughly the same but your expedited freight bill keeps climbing month on month, that tells you something quite specific about where your process control is actually breaking down, probably somewhere in scheduling or capacity planning rather than on the shop floor itself.

Third, and this feels particularly relevant if you’re running a plant anywhere in the UK right now, this kind of visibility matters more when margins are already under pressure. And they are under pressure. Manufacturers across the country have been dealing with rising energy costs, climbing employment costs, and now increases to business rates landing on top of everything else, adding close to a billion pounds a year in extra cost across the sector according to Make UK’s own analysis. A fair number of firms are reportedly sitting on less than twelve months of cash, with some genuinely worried about what happens if costs keep outpacing what they’re able to charge their customers. In that kind of environment, a hidden monthly cost running three to five times bigger than anyone realised isn’t just an interesting bit of analysis to file away. It’s real money that could be going towards keeping the lights on, investing in the tools that actually prevent the failures happening in the first place, or simply protecting your margin long enough to get through a genuinely difficult trading year.

Fourth, resist the urge to try and fix everything at once. Once you’ve broken your number down into its five parts, you’ll usually find one category is doing most of the damage on its own. Maybe it’s lost capacity because you’re running close to full and every failure costs you real sales you can’t easily recover. Maybe it’s expedited freight because your scheduling buffer’s grown too thin over time. Fix the biggest lever first, remeasure the following month, and let the number itself tell you honestly whether it worked.

The bin was never the real number

I think the honest takeaway here is a fairly simple one, even if getting to it properly takes a bit of graft. The scrap bin was never lying to you exactly. It’s just been telling you a small, tidy fraction of the truth and quietly letting you assume that was the whole picture all along.

Once you pull material cost, machine time, labour, re inspection, expedited freight and lost capacity into one place, you’ll almost certainly land on a number that’s uncomfortable in a genuinely useful way. Not uncomfortable because it’s wrong, but because it’s finally accurate, and accurate numbers tend to demand action in a way vague, half formed ones never quite manage to.

You don’t need a new system to start doing this properly. You need an hour with a spreadsheet, the willingness to ask your finance and logistics teams a few pointed questions they might not have been asked before, and the discipline to repeat the exercise every month rather than treating it as a one off audit you tick off and forget. Do that consistently for a few months and you’ll have something a lot of your competitors probably still don’t, a real, defensible number for what quality failure is genuinely costing you, and a clear map of exactly where to spend your next pound of improvement budget for the biggest possible return.

The scrap bin will still be sitting there on Friday afternoon, same as always. But now you’ll know it was only ever the tip of what you’re actually paying for.

Ready to close the gap

Working out the real number is one thing. Actually closing the gap between £5,000 and £18,000 is another, and that’s usually where plants get stuck. Not because the will isn’t there, but because nobody’s got the spare time to build a proper improvement system on top of an already busy shop floor.

That’s what TCMUK’s Lean Coaching Programme is built for. It’s not another consultant turning up with a clipboard, it’s hands on coaching from Adam Payne and the team, working alongside your people to turn scrap, rework and firefighting into a genuine culture of continuous improvement. One client using the programme cut waste by 93 per cent and lifted efficiency by 52 per cent. Clients typically see scrap and rework fall by around a quarter within the first year.

If you’d like a straightforward, no pressure conversation about what that could look like for your plant, you can find out more about the Lean Coaching Programme.

Get your Changeovers out of the Slow Lane

Posted on by Adam Payne

Why long set ups quietly cap your capacity, and how SMED gets the time back without buying another machine.

There’s a conversation I’ve heard in more factories than I can remember. A key machine is “at capacity.” A customer’s getting nervous. Somebody puts a quote for a second machine on the MD’s desk, and the talk turns to finance, floor space and who on earth is going to run it.

And nobody, at any point, asks how much of the week that first machine actually spends making parts.

Whether you run a high-volume business or a low volume one, changeovers are one of those things that can quietly drain the life out of your manufacturing process. Left alone, an unstructured approach to set ups has a habit of growing arms and legs. Then the arms and legs grow arms and legs. Nobody plans it. It just creeps.

I first saw this properly in the early nineties. I was a Kaizen engineer at a business making aerospace fasteners, and we were being trained in lean manufacturing by a Japanese sensei. He split us into three teams for a week of improvement events on three different machines: a centreless grinder, a thread roller and a header machine. My team got the header.

The first thing we did was film a real changeover, start to finish. Not a demonstration. The real thing, done the way it had always been done.

When we added it up, there were eight hours of it. A whole shift. For a production run that would last thirty minutes to an hour, depending on batch size, and we were talking batches in the thousands. The machine ran three shifts, so a big slice of its working life was spent getting ready to work.

And here’s the bit that still makes me smile. A major customer had flagged that machine as a high risk to their supply because of capacity. They were actively pushing us towards buying another one.

At the start of the week, we’d have been delighted with a 50% reduction. Honestly, that felt ambitious. Never in a million years did we think we’d get it under thirty minutes. But we did.

That week changed how I look at every factory I walk into. So this post is the longer version of what I learned, brought up to date for UK manufacturing in 2026. What long changeovers really cost you, why you should film one before you touch anything, how to split internal work from external work, and the three words that have stuck with me for over thirty years: eliminate, combine, simplify.

What a long changeover is really costing you

Most people think of a changeover as lost machine time. It is. But I think that’s the smallest part of the bill.

The bigger cost is what long changeovers force you to do to cope with them. If a set up takes half a shift, nobody wants to do it often. So you run bigger batches. Bigger batches mean more work in progress on the floor, more finished goods in the stores, more cash tied up in stock and more floor space lost to racking. You make things before anybody’s ordered them, which is overproduction, the waste that tends to feed all the others. Jobs wait in a queue behind the big run. Material gets moved, stacked, then moved again. Lead times stretch, so you quote longer, so customers order earlier and in bigger lumps, and round it goes.

In other words, a long changeover doesn’t just waste an hour. It sets your batch size. And your batch size quietly sets your stock, your lead times and a fair bit of your cash flow.

There’s a nice bit of history here. For most of the twentieth century, factories worked out batch sizes using the economic order quantity, a formula that treats set up time as a fixed cost you simply have to live with. Toyota’s big insight was to question the “fixed” part. If changeovers get short enough, the economic batch gets small, and suddenly you can make what customers actually want, when they want it.

That matters more for UK manufacturers now than it did when I was stood next to that header machine. A lot of your customers want smaller quantities, more variants and shorter lead times, and they don’t want to pay for you holding their stock. For plenty of UK firms, high mix, low volume isn’t a niche anymore. It’s just the work.

Then there’s capacity. Make UK’s Q3 2026 Manufacturing Outlook showed the UK orders balance rising from +12% to +17%, but manufacturers holding back on hiring because employment, energy and input costs are still biting. More orders. Same people. Same machines. So where’s the extra output meant to come from?

Before you sign off a second machine, or another shift you can’t staff, it’s worth asking a slightly awkward question. How much capacity is already sitting inside your changeovers, waiting to be found?

In my experience, it’s usually more than anyone guesses. Quite a lot more.

Film it before you fix it

If you take one thing from this post, make it this. Before anyone suggests a single improvement, film a real changeover.

Not a rehearsed one. Not the one your best setter does when he knows the MD’s watching. The normal one, on a normal day, from the last good part of the old job to the first good part of the new one. That’s the bit that counts, by the way. The changeover isn’t finished when the new tool’s in. It’s finished when you’re making good parts at the right rate.

Why video? Because memory is hopeless at this. Ask a setter how long a changeover takes and you’ll get an honest answer that’s often wildly out, because nobody notices the walking, the waiting and the searching. They just feel like part of the job.

When you play the footage back with the team, a few things almost always jump out.

Walking. One practitioner wrote about watching an operator go to the tool store fourteen times in forty-five minutes, collecting one tool at a time. I’ve seen versions of that more often than I’d like to admit.

Searching. For the right spanner, the right insert, the drawing, the program, the forklift, the person with the key to the cabinet.

Waiting. For the crane, for quality to sign off a first off, for material nobody brought up because nobody knew the job was next.

Adjusting. Run a part, measure it, tweak, run another, measure again.

That last one is the big one, and it surprises people. Shigeo Shingo, the Japanese engineer most closely associated with quick changeover, broke a typical set up into four chunks. Preparing and checking tools and materials took about 30% of the time. Centring, dimensioning and setting conditions took about 15%. Trial runs and adjustments took about 50%. And actually mounting and removing the tool? Around 5%.

Five percent. The bit everyone pictures when they think “changeover” is barely a rounding error. The rest is preparation and guesswork.

A quick word on how you film it, because it matters. Tell people why you’re doing it. Make it clear you’re studying the process, not the person. The setter on that footage is usually the one who knows exactly where the time goes and has been quietly frustrated by it for years. Put them in the room when you watch it back, and let them talk first. You’ll learn more in an hour than in a month of stopwatch studies.

Then map it. List every step, how long it took and who did it. A simple spaghetti diagram, which is just a sketch of the machine with a line drawn wherever the operator walked, is brilliant for this. If it looks like someone’s dropped a plate of spaghetti on the drawing, well, you’ve found some easy wins.

Internal and external: the split that changes everything

Once you’ve got the list of steps, there’s one question to ask of every single one.

Does the machine have to be stopped to do this?

If it does, it’s internal set up. Taking the old tool out. Fitting the new one. A few genuine settings. That work can only happen when the process is stood.

If it doesn’t, it’s external set up. Fetching the tools. Finding the drawing. Bringing the material to the machine. Preheating a mould or die. Presetting tools off the machine. Checking you’ve got the right fixings. All of that can happen while the last job is still running.

The principle is simple, and it was the backbone of everything we did on the header machine. Do as much of the work as you can while the machine’s still running. Keep internal work to the absolute minimum, ideally just fitting and removing the tool, die or material, and nothing else.

I’d almost guarantee you’ll find that a lot of what’s being done with the machine stopped didn’t need the machine stopped at all. It’s just always been done that way. The setter stops the machine, then goes to look for the tooling. Nobody ever decided that was the right order. It just became the order.

Shingo described the journey in roughly four stages. First, make sure anything external really is done while the machine runs. Second, separate internal from external properly, so everyone can see which is which. Third, convert as much internal work as you can into external work. Fourth, improve everything that’s left.

Toyota’s big press changeovers are the classic example, and I think they’re worth knowing because they show how much of this is about preparation rather than clever engineering. Their huge stamping dies were being positioned by eye and nudged with crowbars, with test pressings in between, and a change could take anywhere from twelve hours to nearly three days. The first improvement was simply to record the right measurements for each die and set to those rather than by eye. That alone took it down to about an hour and a half. Then came staging the next die and the crane before the old one came out, and keeping the right tools at the press. Eventually it got to under ten minutes per die.

That’s where the name comes from. SMED stands for single minute exchange of die, but “single minute” means a single digit, so under ten minutes, not literally sixty seconds. Shingo usually gets the credit, though to be fair the history’s a bit more tangled than that, and Toyota’s engineers had been chipping away at changeover times since the forties. Shingo also claimed his own data showed set up times falling, on average, to around 2.5% of where they started. Maybe take that with a pinch of salt. But even a fraction of it would change most factories I know.

You can start moving work external without spending much at all:

Changeover kits or carts. Everything the job needs, tools, fixings, gauges and paperwork, staged at the machine before it stops.

A visible schedule. If the setter doesn’t know what’s next, they can’t prepare for it. A simple board showing the next two jobs fixes more than you’d think.

Preheating and presetting. Warm the mould, preset the tools, load the program, all while the current job finishes.

First off checks planned in. Agree with quality in advance when they’ll be needed, rather than waiting for someone to wander over.

Eliminate, combine, simplify

The phrase that’s stuck in my head since those early events is three words. Eliminate, combine, simplify.

It comes from a framework Toyota borrowed from the American Training Within Industry programme of the Second World War, usually written as eliminate, combine, rearrange and simplify. I’ve always remembered it as three, and to be honest three’s easier to keep on a whiteboard anyway.

Take whatever internal work is left and run each step through those words, in order.

Eliminate first. Can you stop doing this step altogether? Shingo had a lovely observation about bolts: it’s only the last turn that actually tightens it. Everything before that is just movement. So if a clamp needs twelve turns of a bolt, that’s eleven turns of waste on every changeover. Quarter turn fasteners, cam clamps, keyhole slots and quick release fittings all attack that. And do you really need eight bolts holding something that four would hold safely?

Adjustments are the other big target. Every adjustment is a sign that something isn’t located in the right place. Locating pins, fixed stops, spacers cut to height and marked datum lines can turn “fiddle until it’s right” into “fit it and it’s right.”

Then combine. Can two steps happen at once? Two people working in parallel, one each side of the machine, can sometimes halve what’s left of the internal time. It needs a bit of choreography, and you’ve got to think hard about safety, but it’s often worth it on a bottleneck machine.

Then simplify. Make whatever’s left easy and hard to get wrong. Standardise tool heights so everything sits at the same shut height. Use the same size fixing everywhere so one spanner does the lot. Colour code. Put a photo of the finished set up on the machine. Shingo called this standardising function rather than shape. Your tools don’t all need to be identical. They just need to fit and locate the same way.

A word of warning, from experience. Don’t start with the engineering. Teams love designing a clever quick release fixture, and fair enough, it’s the fun bit. But the cheap stuff, the cart, the schedule, the staging and the checklist, usually gets you a big chunk of the gain for very little money. Get that in first. Then spend engineering time on what’s left, once you can see what really matters.

On the header machine, if I remember rightly, a lot of our first day’s gains came from nothing more sophisticated than a trolley, a marker pen and a bit of agreement about who fetched what. The clever bits came later in the week.

Making it stick, and spending the time wisely

Here’s the frustrating part. A great SMED week can quietly unravel within a couple of months if nothing holds it in place. New setter, mad week, the cart gets borrowed for something else, and before you know it the machine’s stood while someone goes looking for an insert again.

A few things help.

Write the new standard down. A one-page changeover standard, ideally with photos, kept at the machine. Who does what, in what order, and what “ready” looks like before the machine stops.

Put changeover time on the board. If you’ve got a daily production board, add changeover time to it. What gets looked at every morning gets talked about. What gets talked about tends to hold.

Check the kit, not just the clock. A quick audit of the changeover cart once a week catches the slow drift before it costs you.

Go round again. A common rule of thumb is that each serious pass through the process takes out somewhere around 45% of what’s left. So a two-hour changeover might need a few rounds before it gets anywhere near ten minutes. That’s normal. It’s a loop, not a project.

Then there’s a question most teams forget to ask until it’s too late. What are you going to do with the time you’ve saved?

It’s tempting to keep running the same big batches and pocket the extra hours as output. Sometimes that’s the right call, especially if the machine’s a genuine bottleneck and the order books full. But often the bigger prize is changing over more often, running smaller batches, and taking stock and lead time out of the whole business. The hours you win back on the machine can come back to you as cash in the bank, space on the floor and shorter quotes for your customers.

I’d decide that on purpose, as a leadership team, rather than letting it happen by default. Otherwise, you tend to end up with neither.

Bringing it back to the header machine

Let’s pull it together.

Long changeovers do more damage than the minutes on the clock suggest. They push you into big batches, and big batches drive work in progress, finished stock, overproduction, waiting and endless moving of material. And with orders improving across UK manufacturing while hiring stays cautious, the capacity hiding inside your changeovers might be the cheapest capacity you’ll ever find.

The method isn’t complicated. Film a real changeover and watch it with the people who do it. Split internal from external, and move everything you can to while the machine’s still running. Then take what’s left and eliminate, combine and simplify. Standardise it, measure it daily and go round again.

Think back to that customer pushing us to buy another header machine. We never needed it. The capacity was there all along. It was just spending a whole shift at a time getting ready to work.

So before you sign off on new kit, film your worst changeover. You might be surprised. I usually am, even now.

If you’d like a hand, this is exactly the kind of thing we do at TCMUK. Our Lean Coaching and Mentoring Programme trains your own people in tools like SMED and then coaches them through live projects on your shop floor, so the gains belong to your team and keep coming long after we’ve gone. You can read more about the Lean Coaching and Mentoring Programme, or book a 15 minute call with Adam to talk through the changeover that’s causing you the most grief. No pitch. Just a conversation about whether we can help. Your machines are probably far more capable than your changeovers are letting them be.

0330 311 2820

Book a Return Call at a time that Best Suits You “HERE”

The 8 Wastes Costing Your Factory Money Right Now: A Field Guide for UK Manufacturers

Posted on by Adam Payne

Here’s a slightly uncomfortable thought. A good chunk of the money your factory loses this month won’t show up on any invoice.

There’s no bill for the hour a machine sat idle waiting for a first off check. No line on the P&L for the pallet of brackets nobody actually ordered. Nobody sends you a statement for the forty minutes your best setter spent hunting for a torque wrench that “lives” in a drawer it’s never in.

But you pay for all of it. Every single week.

And right now, I think that matters more than it has in a long time. UK manufacturers are paying the highest energy prices in the G7. Nearly nine in ten expect employment costs to keep climbing this year. A Make UK survey back in May found that almost every firm (98%) expects a real hit to profitability, and close to four in ten have already pushed investment back. You can’t do much about the price of gas. You don’t set the National Living Wage. What you can do is stop paying for things your customer never asked for.

That’s really all lean manufacturing is, once you strip away the Japanese vocabulary and the consultant slide decks. It’s a way of looking at your process and asking, for every step, “would the customer pay for this?” If the answer’s no, it’s waste. Taiichi Ohno, the engineer behind the Toyota Production System, grouped that waste into seven types. An eighth, unused talent, was added later as lean spread beyond Japan. Most people remember all eight with one handy word, DOWNTIME: Defects, Overproduction, Waiting, Non utilised talent, Transportation, Inventory, Motion and Extra processing.

I’ll be honest about something. The first time I sat down with a small fabrication business and mentioned lean, the owner laughed. “We’re twelve people in a unit in Walsall,” he said. “That’s for Toyota.” Fair enough, I thought. But by lunchtime we’d found a rack of finished parts that had been sitting there so long the job card had faded. He stopped laughing after that. Not because I’d said anything clever. He just saw it.

So this isn’t a theory piece. It’s a field guide. For each of the eight wastes you’ll get a plain description, a real example from the kind of factory you probably run, and something you can actually do about it. I’ve grouped them into four families, because that’s roughly how you’ll spot them on a normal walk round the floor.

The wastes hiding in your schedule: overproduction, inventory and waiting

These three are close cousins. In my experience, if you find one of them, the other two are usually standing just behind it.

1. Overproduction

Overproduction means making more than the customer needs or making it before they need it. Lean people often call it the worst waste of the lot, and I think they’re right, because it quietly creates most of the others. Extra parts need storing, moving, counting and, sometimes, scrapping.

Field example. A sheet metal shop gets an order for 40 brackets. The press brake is already set up and the materials on the bench, so the supervisor runs 200. “Saves a changeover next time,” he says. Sounds sensible. Except the customer changes the hole spacing four months later, and 160 brackets go in the skip. That’s material, energy, labour and machine time, all paid for twice. Once to make them, and once to throw them away.

What to do about it. Make to the order, not to the machine. If long changeovers are the reason you batch big, that’s the real problem to work on. A simple rule helps: nothing gets made without a customer order or an agreed stock level behind it. Write the rule down. Stick it on the press.

2. Inventory

Inventory is overproduction’s slower, sneakier sibling. Raw material, work in progress, finished goods, it’s all cash sitting on your floor. The usual rule of thumb is that holding stock costs somewhere between 20% and 30% of its value every year, once you add up space, insurance, handling, damage and the cost of the money tied up in it. Some careful benchmarking puts the real figure nearer 10% for well-run firms. Even at the low end, that’s not nothing.

Field example. A food producer I worked with bought a year’s worth of printed film to get a better unit price. Good deal on paper. Then the retailer changed the label design. Most of that film sat in storage… well, it did, until it went to landfill. And for eight months it took up space that could’ve held product.

What to do about it. Walk your stores and ask one question of every pallet: “when will this actually be used?” If nobody knows, that’s your answer. Set sensible maximum levels for your top twenty items and check them monthly. And be a little wary of bulk discounts. A 10% saving can be wiped out by one design change.

3. Waiting

Waiting is any time people, machines or materials are stood still because of something else. It’s the most visible waste on the floor, and oddly the one we get most used to.

The big, dramatic version is unplanned downtime. Research for Fluke found 68% of UK manufacturers had suffered it in the previous year. The headline cost figures in that study come from large plants, but an earlier Oneserve survey put the average UK manufacturer’s loss at around 49 hours a year, roughly 3% of working days. In a small factory, that’s more than a week of output. Just gone.

But honestly? The waiting I see most in smaller firms isn’t the big breakdown. It’s the little stuff.

Field example. A CNC operator finishes setting a job, then waits for the quality engineer to sign off the first part. The engineer’s in a meeting. Forty minutes later the spindle finally turns. That happens two or three times a day, across several machines. Nobody’s done anything wrong, exactly. The process just has a queue built into it.

What to do about it. Track waiting for one week. A tally sheet taped to each machine is plenty: what were you waiting for, and for how long? You’ll probably find two or three causes cover most of it. Train setters to do first off checks against a clear standard. Have the next job’s material and tooling ready before the current one finishes. And get basic preventative maintenance right before you even think about buying clever sensors.

The wastes on the move: transportation and motion

People mix these two up all the time, and to be fair, the line is a bit blurry. Here’s how I think of it. Transportation is moving the product. Motion is moving the person.

4. Transportation

Every time a part goes on a forklift, a trolley or a pallet truck, you’re paying for it. Fuel or charging, labour, the truck itself, and the risk of a dropped crate. And the customer gets nothing for any of it. A part that’s travelled 500 metres isn’t worth a penny more than one that’s travelled five.

Field example. A plastics moulder grew the way lots of UK firms grow, one unit at a time. Moulding ended up in one building, assembly in the next, and packing in a third across the yard. When someone finally traced a single product’s journey with a trundle wheel, it covered just over 400 metres before it was boxed. Outside. In the rain, for half the year. Every crate got handled six times.

The funny thing is, nobody had really noticed. It had just become “how we do it here.”

What to do about it. Draw a spaghetti diagram. Honestly, it’s that simple. Take a plan of your site, pick one product, and draw a line for every move it makes. The tangle tells you everything. You won’t always be able to shuffle buildings around, but you can often move a packing bench, put two linked processes side by side, or finally get rid of that “temporary” storage area halfway across the factory that’s been there since 2019.

5. Motion

Motion is the wasted movement of people. Walking, reaching, bending, searching. It’s tiny in any single moment, which is exactly why it slips past. And it costs you in other ways too: sore backs, tired operators, and more mistakes late in the shift.

Field example. An electronics assembler shares a toolbox with two colleagues at the end of a long bench. When we tallied it over a morning, she was walking to it around sixty times a shift. Call it twenty seconds a trip. That’s twenty minutes a day, per person, just fetching things. Across three people and a working year, you’re well past 200 hours. That’s roughly six weeks of somebody’s time. For a toolbox.

What to do about it. This is where 5S earns its keep: Sort, Set in order, Shine, Standardise, Sustain. Don’t let the name put you off. In practice it just means everyone has what they need, where they need it, and nothing they don’t. Shadow boards, point of use storage, parts presented at a sensible height. I’ve seen a £60 set of duplicate screwdrivers pay for itself inside a fortnight. Not glamorous. Works, though.

The wastes built into the work: defects and extra processing

These two tend to feel like “just part of the job.” Which is precisely why they’re so expensive.

6. Defects

A defect is anything that has to be scrapped, reworked, sorted, checked again or sent back. The obvious cost is the material. The real cost is everything wrapped around it.

The American Society for Quality reckons quality related costs run at 15% to 20% of sales revenue for many manufacturers, and as high as 40% at the worst performers. Maybe you read that and think, “not us, surely.” Maybe you’re right. But the same organisation found that only 31% of firms feel they fully understand what poor quality costs them. Most of it hides in labour, overtime and goodwill, not in a neat column marked “scrap.”

Field example. A joinery firm making bespoke staircases had a habit of fixing problems at the fitting stage. A tread slightly out, a baluster hole drilled off centre, and the fitter would just sort it on site. No scrap recorded, so no problem. Except when they finally added it up, the fitters were spending roughly a day a week on rework, plus extra van trips, plus the odd unhappy customer who noticed. It was costing them more than their whole marketing budget. Nobody had ever written it down as a defect, so in a strange way it didn’t exist.

What to do about it. Start counting. Every reject, every bit of rework, every return, logged with a reason. A whiteboard by the door will do. After a month, sort the reasons. You’ll almost always find a handful of causes behind most of the trouble. Then ask “why?” five times about the biggest one, and fix the cause rather than the symptom. Mistake proofing (a simple jig, a locating pin, a go/no go gauge) often costs pennies compared with the problem it solves.

7. Extra processing

Extra processing is doing more work than the customer actually values. Tighter tolerances than the drawing asks for. A finish on a face nobody will ever see. Paperwork that gets filled in, filed and never read again. It’s the sneakiest waste, I think, because it usually comes from good intentions. People want to do a proper job, and that’s a good thing. Mostly.

Field example. A precision engineering firm was hand deburring and polishing an internal face on a bracket. About six minutes a part. When someone finally rang the customer, it turned out that face sat against a rubber mount and was never seen again. Six minutes, across a few thousand parts a year, for nothing at all. Same story with inspection: one critical dimension was being measured by the operator, again by QC, and again at dispatch. Three checks. One good one would’ve done.

What to do about it. Go back to the drawing, literally, and back to the customer. Ask what really matters to them. Then look at each step and ask, “if we stopped doing this tomorrow, would anyone notice?” Be a bit careful, though. Some extra steps exist for a perfectly good reason that somebody forgot to write down. So check before you cut. But do check.

The waste nobody counts: unused talent

8. Non utilised talent

This is the eighth waste, the one that got added later. And if I’m honest, it’s the one I’d put first.

You already pay for the knowledge in your building. Every operator, setter, storeman and driver knows things about your process that you don’t. Things that never make it onto a drawing or into the ERP system. When that knowledge goes unused, it’s waste, just as surely as a skip full of scrap. Arguably more so, because you can’t easily buy it back.

And right now you really can’t. UK manufacturing is short of skilled people, wages keep rising, and around 60% of manufacturers say skills are the main thing holding back their move into automation. So the talent you’ve already got on the payroll is, quite literally, your scarcest resource.

Field example. A setter at a pressings company had worked out, entirely on his own, a way to cut a changeover from about ninety minutes to under forty. Staging the next tool on a trolley beforehand, swapping a few bolts for quick release clamps, that sort of thing. He’d been doing it on his own shifts for over a year. Nobody else knew, because nobody had ever asked him. When the owner finally found out, she said something I’ve heard a few times now: “Why didn’t he just tell us?” I think the honest answer is that he didn’t think anyone wanted to know.

Remember the shop earlier, running 200 brackets to save a changeover? Shorter changeovers make that temptation disappear. The wastes connect like that, which is sort of the point.

What to do about it. Ask. Properly, and regularly. A ten minute huddle at the start of the shift with one question: “what got in your way yesterday?” Write the answers on a board. Fix one small thing every week and tell people you did it. That last bit matters more than you’d think. Ideas dry up fast when they vanish into a suggestion box nobody empties.

Where to start: your first waste walk

So, eight wastes. You might be feeling slightly overwhelmed right now, or maybe a bit defensive. Both are normal. No factory is free of waste. Toyota still finds plenty in theirs after seventy years of looking.

The trick is not to try to fix everything at once. Start with a waste walk instead. Lean folk call it “going to the gemba,” which just means going to the place where the work actually happens. Here’s a version that fits into a busy week:

  1. Pick one area. One cell, one line, one product. Not the whole site.
  2. Give it one hour. Take a clipboard, a phone for photos and, ideally, the person who works there every day.
  3. Stand still and watch. Resist the urge to fix things on the spot. Just look, and keep asking, “does this step add value the customer would pay for?”
  4. Use DOWNTIME as your checklist. Go through all eight letters and note what you see under each one.
  5. Put a rough cost on the top three. Minutes, metres, pounds. It doesn’t need to be precise. It needs to be honest.
  6. Fix one thing within a week. Then walk the same area again a month later and see what’s changed.

One more thing, and it’s a bit of a soapbox moment, so bear with me. Lots of UK firms are spending serious money on digital tools at the moment. The Kaizen Institute points out that 76% of UK manufacturers are investing in digital, AI and automation, yet our productivity still trails the G7 average by roughly 10%. I’m not against technology. Not at all. But if you automate a process full of waste, you just get the same waste, faster, with a nicer dashboard. Fix the basics first. Then buy the kit.

It’s worth knowing, too, that the government’s DRIVE35 scale up fund now lists lean manufacturing as a named technology track alongside digital transformation. That tells you which way the thinking’s heading.

Bringing it together

Let’s step back for a second. The eight wastes aren’t exotic. Overproduction, inventory and waiting hide in your schedule. Transportation and motion are busy moving around your floor. Defects and extra processing are baked into the work itself. And unused talent is sitting in your canteen every morning with a mug of tea, waiting to be asked.

None of this needs a consultant, a software licence or a black belt to spot. It needs you to look at your own factory as if you’d never seen it before. That’s harder than it sounds, I’ll admit. When you’ve walked past the same rack of parts for three years, it stops looking like waste and starts looking like furniture.

Here’s why I think it matters so much right now. You can’t make energy cheaper. You can’t stop employment costs going up. You can’t make customers pay faster or order more. But every hour of waiting you remove, every pallet of stock you don’t need, every rework job you prevent, drops straight through to your bottom line. It’s margin you win back without selling a single extra part. In a year when Make UK is forecasting barely any growth for the sector, that’s not a small thing.

So don’t try to tackle all eight this month. Pick the one that made you wince a little while you were reading. The example that sounded a bit too familiar. Walk that area this week, put a rough number on it, and fix one thing.

Then do it again next month.

That’s it, really. Lean isn’t a project with a finish line. It’s a habit. And the factories that build that habit, quietly and a bit at a time, tend to be the ones still standing (and still growing) when the next cost squeeze comes round. Which, let’s be honest, it will.

If one or two of these wastes felt a bit too close to home while you were reading, that’s honestly a good sign. It means you can already see them. The harder part is building the habit across your whole team, so it isn’t just you spotting waste on the odd afternoon when you’ve got a spare hour. That’s exactly what our Lean Training is for. It’s practical, shop floor training built for UK small and medium manufacturers, not a slide deck about Toyota. Your team learns to spot the eight wastes, run their own waste walks and fix problems at the source, using your products and your processes as the examples. You can find out more and book a place on our Lean Training.