Many words have been written about 2020 as a turning point year in industry and the economy. The outbreak of the corona pandemic disrupted our routine and forced everyone to adapt. For the plastic industry in general, and Rion in particular, the beginning of the corona period marked two things: increased demand combined with supply chain disruptions. How do you tackle such a complex situation? Rachel Peled, Supply Chain Manager at Rion, which includes production planning and control (PPC), procurement and warehouses, sheds light on this issue.
Transparency with the customer and equipping in advance
“Our logistics policy combines several components that offer our customers security in the face of tough times”, says Rachel. “One of the important components is orderly and transparent communication with them. During the corona period there was, and there still is, uncertainty regarding the supply of raw materials. Our direct communication with the customers, while transparently presenting the situation regarding the means of production and raw materials, helped us find timely quality solutions to meet supply schedules. I am referring to the policy of maintaining higher inventory levels and to finding alternative suppliers and raw materials that will enable us to continue to manufacture and to supply on time.”
Rachel also notes a higher inventory level of critical materials maintained at Rion in case of force majeure events. “Even before the corona outbreak, we learned to appreciate advance equipping and decided on a policy of maintaining an inventory of important materials such as polycarbonate and additional raw materials. This approach proved itself with the longer supply times, increased shipping costs, and now also following the challenging impact of the fighting between Ukraine and Russia. To enable us to increase our inventories we acquired huge storage tents that provide proper storage conditions for the stored material. Our ability to acquire these materials in advance, to manufacture and to supply on time, contributed to our customers who themselves benefitted from the ability to rapidly supply the products to their end customers, and in certain cases helped them demonstrate an advantage over their competitors.”
Seeing the big picture of the manufacturing process
Rachel fills a unique and important position at Rion. Her areas of responsibility begin with receiving the order from the customer, and continue with manufacturing planning and procurement up through shipment to the customer. “We plan the supply times according to the customer’s requirements”, she explains: “for most of our customers we manufacture according to a forecast and maintain a suitable inventory. Rion has a varied fleet of 120 injection molding machines, with a clamping force of 50 – 1080 tons, which enables us to offer our customers high level service. All demand (order/forecast/safety stock inventory) goes through our MRP system, which calculates each night the required machine time, quantity of materials and other required procurement items. This planning enables us to update the customers regarding the estimated supply dates for their order.”
Human capital and good communication are the secret to our success
Despite all our prior pre-planning and preparation, Rion’s real strength is found in its human capital. Rion’s Supply Chain department is comprised of about 20 employees, in addition to another 7 at the Plastokit site, all professionals in their respective fields. “During periods of uncertainty the ability to rapidly respond to occurring changes is highly important. Our good communication and quick decision making processes make this possible. The ability to quickly assess the situation across the organization, combined with high accessibility to the different managers in marketing, operations and finance, and of course to the CEO, is enormously helpful in our ability to provide a rapid customer response”, adds Rachel.
We do not see ourselves as a sub-contractor, we are the customer’s production plant
There are injection molding sub-contractors that operate separately from the customer. At Rion, owing to the close relationship, we resemble more of an internal department located in customer’s the plant. This relationship comes into play in good as well as in challenging times. “Our approach towards storage and inventory, combined with our technical abilities, delivers unique value to our customers. They show their appreciation through the trust they place in us, and I feel a sense of satisfaction in our ability to contribute to their success”, summarizes Rachel.
At Rion our customers benefit from a high level planning department, the set up of manufacturing infrastructures, maintained product trees and alternative raw materials, data and materials requirement planning. All of them while presenting information such as raw material procurement costs and product production process costs.Picture 1: Supply Chain Department that includes production planning and control (PPC), procurement and warehouses