Inventory valuation: the number that decides your profit
How stock is valued changes reported profit and tax without anything physical changing. FIFO against weighted average, what cost includes, and the write-down nobody wants to make.
Changeover time is capacity you already paid for. How to measure it honestly, which half of it can be done while the machine runs, and why batch sizes follow from it.
Changeover is the time between the last good unit of one job and the first good unit of the next. It is not downtime in the sense of a breakdown — nothing is wrong — which is exactly why it goes unmeasured for years. A line losing ninety minutes four times a day is losing six hours of capacity daily, and that capacity is usually bought back by buying a second machine.
Almost every changeover contains work that did not need the machine stopped — tools collected, next materials staged, paperwork prepared, settings written down. Moving that work outside the stopped window is the single largest and cheapest improvement available, and it typically removes a third of the time without buying anything. The remaining internal work is what deserves engineering attention, and only after the easy half has been moved.
Standardise the sequence before trying to speed it up. A changeover done four different ways by four operators cannot be improved, because there is no baseline to improve against and every measurement reflects who happened to be on shift.
Long changeovers force long runs. If switching costs two hours, nobody switches for a small order, so batches grow, stock grows, and the business ends up holding inventory to compensate for a setup problem. That is the hidden cost: the inventory on the shelf is the price of the time lost at the machine. Halving changeover time does not just add capacity — it makes smaller runs economic, which is what lets a small manufacturer quote short lead times without carrying everything in stock.
Ettex Sheets is enough to hold the log — job pair, type, start, first good unit and who ran it — which is all the data an improvement needs. Where the result changes what can be promised, it feeds straight into the production schedule, since shorter changeovers are what make a tighter sequence realistic.
From the last good unit of one job to the first good unit of the next, including trials and adjustments. Floor measurement, not estimates — estimates run about half the real figure.
Internal work requires the machine stopped; external work does not. Moving external work outside the stopped window is usually the largest and cheapest gain available.
Long setups force long runs, so batches and stock grow to avoid switching. The inventory is effectively the price of the time lost at the machine.
How stock is valued changes reported profit and tax without anything physical changing. FIFO against weighted average, what cost includes, and the write-down nobody wants to make.
Staff turnover is easy to calculate and easy to misread. How to work it out, why voluntary and involuntary must be separated, and what a replacement actually costs.
Business interruption cover replaces lost profit while you cannot trade. How the sum insured is calculated, why the indemnity period is the number that matters, and what is usually excluded.