Managing Cotton Gin Inventory Systems: Systems Management Approach Using Simulation

The Goal of a cotton gin manager is to provide a value added service to the cotton producer at the lowest cost and as quickly as possible. With the reduction in the number of cotton gins to approximately 230 in the state of Texas, gins are growing larger to meet the production on the farm level which approaches 5.5 million bales annually. This has required the gin to travel further to take advantage of any economies of scale that may exist.  A Decision Support Software package was developed and published for cotton gin managers and producers to determine the economic risks and benefits of transporting seed cotton modules from the field to the gin. The software provided results that showed long distance hauling can reduce the total ginning cost per bale realized by the gin by operating at a point where total cost per bale is optimized at 200 Percent Utilization in gins rated at or above 60 bales per hour.  However, a systems analysis was needed to ensure that longer hauling distances will not have any adverse effects on the operation of the gin.  Longer haul distances, up to 100 miles, may require procedural changes within the inventory system of the gin to ensure that the number of seed cotton modules present on the gin yard is sufficient to supply the gin throughout the season. Downtime within the ginning operation caused by lack of seed cotton at the gin could reduce or eliminate any savings that were possible when the gin operates at a point that is considered optimal.  The topics covered by this paper discuss the idea of using simulation to evaluate whether or not the current management practices employed by the gin are adequate to prevent any downtime within the system due to lack of module inventory.