Supply Chain and People Panels 2022 Corrugated Week

Converters, Suppliers Compare Supply-Chain Challenges

In a breakout session held Tuesday, September 20, at AICC/TAPPI Corrugated Week in San Antonio, A panel made up of converters and solution suppliers discussed the challenges of delays and disruptions in the raw material supply chain. Moderator Mike Kohler of Kohler Coating introduced to the 100-plus people in attendance panelists Benjamin Findley of Machine Compare, Mark McNay of SMC Packaging Group and Andrew Akers of Akers Packaging Service Group.

Kohler’s introductory remarks called the supply chain disruptions of the past two years “the proverbial monkey wrench in the gears” of an efficiently operating industry. “Everyone, whether suppliers or converters, has experienced it,” he said. Leading the discussion was Benjamin Findley, CEO of Machine Compare. Machine Compare is helping alleviate the current supply chain challenges by creating a global online pool of spare parts across all industries. Findley’s research shows upwards of $285,000 worth of excess spare parts in the corrugated industry alone, and he said that this inventory could be tapped if it were catalogued in a single online platform, thus providing a faster delivery of already-available parts and components to plant sites when needed. This practice is common in industries like commercial aviation and he foresees it could also be applied in the corrugated converting sector as well.

Mark McNay of SMC Packaging Group, Springfield, Mo., presented two perspectives in his company’s experience with supply chain slowdowns: first, as a consumer of materials for the production of corrugated boxes; and second as a supplier to his customers. In the first instance, McNay cited the principal concerns of many boxmakers: containerboard, sheets and what he called the “other raws” of starch, pallets, glue and other consumables. He went on to list other areas where SMC and others have experienced delays: OEM parts; capital equipment; transportation in the forms of trucks and rail cars; natural gas and diesel fuel and electricity.

In SMC’s capacity as a supplier to its customers, McNay said that “dynamic business growth” in the past two years has put a strain on the industry’s ability to

satisfy its customers’ demand. This dynamic growth, he said, was driven by changing consumer behavior and it an effort to help their customers adapt SMC has proactively “coached” buyers to avoid panic buying which has driven large gyrations in inventory. McNay said that in the current scenario the “Just in Time” inventory management practices honed so finely over the past 20 year are no longer realistic and have to be balanced to reflect the industry’s ability to predictably deliver finished boxes.

Andrew Akers of Akers Packaging Service Group echoed McNay’s comments about the delays in raw material supplies, adding that a major problem for his company has been receiving incoming roll stock via rail. He also cited delays in equipment installation due to the extended backlogs of machinery suppliers and also the inability of technicians from European manufacturers to travel to the USA due to covid travel restrictions.

Both McNay and Akers described steps they’ve taken to alleviate these disruptions, including:

• Strengthen relationships with existing suppliers
• Identify other independents in area to form a parts exchange
• Identify alternative sources of supply for parts and consumables
• Work with customers to achieve more accurate demand forecasts, and
• Proactively communicate with customers as to needs to prevent panic buying

Copies of all the presentations given during AICC/TAPPI Corrugated Week can be found at www.corrugatedweek.org.

1st Photo Caption:  Mark McNay of SMC Packaging Group speaks at Supply Chain breakout session at 2022 AICC/TAPPI Corrugated Week. Seated, from left:  Mike Kohler, Kohler Coating, moderator; Benjamin Findley of Machine Compare; and Andrew Akers of Akers Packaging Service Group.