Abstract
The textiles and garment industry plays an important role in Thailand’s economic growth, despite facing competition in product quality and rising production costs. Meeting diverse consumer needs and satisfaction has become increasingly difficult, as environmental issues become a major concern for firms internationally. Entrepreneurs require sophisticated strategic management techniques to maintain organizational productivity. Growing industries generate material losses, while negatively impacting the environment. Companies may account for their waste, but in reality, actual productivity is much lower, since hidden wastes are mostly unaccounted for and unquantified. A key barrier to reducing waste is that potential cost savings by revising waste management processes are not calculated. To solve this problem, material flow cost accounting (MFCA) was introduced to reduce negative product costs in a ladies’ lingerie company by identifying and evaluating the quantity and cost of concealed material waste. An effective meta-heuristic called the Two-Dimensional Cutting Stock Problem—Tabu Search algorithm (2DCSP-TS) was then proposed based on the idea of finding a layout that minimized a bin length. The multi-phase arrangement strategy embedded in it can obtain near-optimal conditions for solving realistic-sized problems. To illustrate the effectiveness of the proposed methods, numerical experimental results were compared with those of the current practice. From the numerical experiments, it was found that the proposed technique is an efficient method for reducing negative product costs.
Highlights
The industrial sector has focused on the integration of technology in the manufacturing process, known as industry 4.0 [1,2]
The analysis of material loss and the relevant cost is difficult to analyze by collecting traditional cost accounting; the Material Flow Cost Accounting (MFCA) technique helps classify and identify the loss that occurred, and is to convert production losses to monetary terms that can encourage managerial people to be aware of production losses
The result of the study on a leader in garment industry operating more than 40 years in Thailand with the demand chain covered from upstream to downstream reveals that the company is but one of the business sectors that has to adapt to the current world economics trend by considering ways to manage existing resources most efficiency and with environmental awareness
Summary
The industrial sector has focused on the integration of technology in the manufacturing process, known as industry 4.0 [1,2]. Employing mass production to decrease unit costs no longer meets customers’ needs as in the past because the customers have demands on variety, as well as good value for money Another factor to which consumers pay attention is cleaner production; a new manufacturing system called mass customization has been introduced. Mass customization allows companies to provide customers with uniqueness and meets personal demands with reasonable costs [5] This is consistent with the Lean manufacturing system [6,7] that aims to increase values and eliminate the seven types of waste: overproduction, waiting, transporting, inappropriate processing, unnecessary inventory, and unnecessary motions [8] in production to enhance flexibility and contribute to small lot sizing
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