Three-bin Kanban replenishment system for reducing production downtime and material shortages: a manufacturing case study

Purpose Material shortages stopped assembly lines at an outdoor power equipment manufacturing plant for an average of 56 h every month, and the plant scrapped US$240,000 of inventory each year. This paper aims to report how a three-bin Kanban pull system was designed and deployed to address these problems without capital investment. Design/methodology/approach A before-and-after case study covered 12 assembly lines handling approximately 18,600 bin-managed SKUs. Baseline scrap data (12 months) and downtime data (6 months) were compared with three months of postrollout data. A two-month pilot on two lines preceded full rollout, during which roughly 400–500 Kanban cards were lost, prompting a shift to permanently labeled bins. Metrics came from the plant’s downtime tracker, ERP scrap reports, and structured time studies. Findings Monthly downtime fell from 56 to about 6 h, shortage incidents dropped from 62 to 12 per month, and average search time per part fell from 42 to 14 min. Annual scrap costs declined from US$240,000 to an estimated US$48,000, saving approximately US$192,000 per year. Research limitations/implications Single site, no control group, three-month postimplementation window. Scrap savings are annualized. Replication elsewhere would strengthen conclusions. Practical implications No capital expenditure was required. The design parameters and rollout sequence are directly replicable in resource-constrained plants. Originality/value Few published case studies document a three-bin Kanban deployment at this scale with measured before-and-after data. The paper also captures the practical lesson of replacing card-based signals with container-based signals after pilot-stage signal loss – a modification rarely discussed in published literature.