By Bruce Geiselman, Karen Hanna and Lynne Sherwin
“For want of a nail, the shoe was lost …”
The ancient proverb about a tiny complication with big repercussions feels especially relevant during the ongoing supply chain crisis, and machinery manufacturers aren’t immune.
“We had a situation a couple months ago where we couldn’t get a blower for a dryer. And when we really dug into why we couldn’t get the blower, it was like five layers deep in the supply chain,” said Sam Rajkovich, VP of sales and marketing for Conair Group. “It was the electrical circuit thermal protection device for the motor on the blower. … This one little component, which we don’t even source directly, was holding up production of our dryer.”
He said Conair has had to rely on its large sourcing team to work through these issues, some of which involve suppliers they have never talked to before. “It seems like there’s a different supply chain problem every day,” he said.
Extruder manufacturer Entek had to create an ad hoc task force to tackle the problem, said Linda Campbell, VP of sales.
“We have a very good reputation for on-time deliveries. However, we are struggling right now,” she said.
The company formed a team of about eight people that meets three times a week to review each component, determine where it stands in the supply chain and make backup plans should problems arise. Even with that intense focus and investment of time, “we’re still not being successful,” she said.
David Preusse, president of Wittmann Battenfeld USA, noted that his company is “routinely challenged for specific parts from our core suppliers who often cannot fill our contracted demands, so we have to pay premiums for alternate suppliers of the same parts.” He expected the issues to extend well into 2020.
Bob Jackson, founder of Jackson Machinery, which sells new and refurbished blow molding machines, has noticed a shortage of one of his most vital components.
“Screws used to be readily available from half a dozen different companies, within three or four weeks. Today, it’s 12 to 20 weeks before you can get a screw,” he said. “There’s a greater demand for them, and people are not buying the new machines. They’re fixing the old one on their floor to contain capital expenditure.”
Finding ways around roadblocks
Some machinery manufacturers report they have weathered the storm thanks to large and integrated source networks for obtaining the parts they need.
LS Mtron has been able to leverage its relationship with its founding company, LG, to keep its suppliers in the family.
“From our company-owned steel-casting facility in South Korea, to our deep relationships with parts vendors, many of whom have been a part of the LG family of founded companies and spinoffs, we can achieve castings to cargo-ready in 100 days or less,” said Peter Gardner, business manager for LS Mtron Injection Molding Machine USA.
Stefan Engleder, CEO of Engel Group, also cited his company’s global production network and multi-sourcing strategy to cut down on delays. But, he said, “the situation is still very tense. We are facing incredible short-termism throughout the supply chain.”
Arburg produces a lot of its components in-house, including its controllers, said President Friedrich Kanz. That internal integration has reduced the company’s dependence on outsourced components.
“Like everyone, we have had to adapt in certain areas,” he said, “but in general, I would say we have not had serious difficulty meeting customer demands.”
For other companies, having machines on hand and ready to deliver has been the solution.
“Our goal is to have 150 machines in inventory at any given point in time,” said Glenn Frohring, co-owner of Absolute Haitian. The company utilizes 21 million square feet of manufacturing space around the world and economies of scale to maintain its stock of injection molding machines and components.
Brian Marston, Uniloy’s CEO and president, said his company has been able to respond to the challenge by offering prebuilt blow molding machines for quick delivery with reduced lead times.
Krauss-Maffei has also been “very aggressive” about maintaining an inventory of stock machines brought in from its European manufacturing facilities, trying to anticipate customer demand so it has the right machines for the job ready to ship, said Brian Bishop, VP, new machine sales.
“From start to finish, it takes a long time to build an injection molding machine if you don’t have any of the parts on hand,” he said. “So, we have to do a lot of good forecasting, and really understanding what our customers’ needs are so that we can fulfill their requirements.”
Automation is in high demand as processors deal with a shortage of workers. Bill Geddis, VP of sales for Sepro, said many customers are looking to buy stock robots, and the company works to keep an inventory on hand.
Getting there is half the battle
Even when a machine is fully outfitted and ready to go, it can’t do much good for a processor when it’s sitting in a container waiting for a ship, a railcar or a truck.
Maureen Steinwall, CEO/CFO of custom injection molder Steinwall Inc., said her company is in the process of gradually replacing its machines. “We would have gotten more last year if we could have gotten them, but there weren’t any to get. I think we had one on order for seven months,” she said.
“One of our presses sat in the Long Beach docks,” she continued. “It was physically here, ready to commit. They couldn’t get a truck to get it to us.”
Even with its extensive interrelationships, LS Mtron has still faced shipping delays, Gardner said.
“LS Mtron has seen difficulties in having our equipment leaving port in Korea on schedule, as some ships do not make it back to Korea in time due to delays caused by port congestion in the U.S.A.,” he said. “Our founding company, LG, even owns one of the world’s largest ocean freight lines ... which we can leverage for favorable logistics control, but if the ship cannot keep its schedule due to U.S. port unloading issues, it’s really hard to control.”
Preusse cited rising costs, delays and workforce shortages in the logistics industry, and Bishop called transportation a “major problem.”
OEMs report that customers have been flexible and understanding. Processors are also dealing with the problems; in PMM’s recent survey, 77 percent of respondents said their operations were negatively affected by supply chain issues in 2021.
“I’m very proud of our entire team, from sales, to service, to engineering, to administration, and how they’ve continued to adapt to the ongoing supply chain issues,” said Raul Scheller, managing director, North America, for Sepro. “We also appreciate the flexibility and cooperation of our customers and vendors as we all work together to find solutions.”
“Everyone is dealing with it,” Geddis said.
Campbell said that Entek used to guarantee that it could deliver an order in 18 weeks and could back that up with a 98 percent on-time delivery rate. Now, 18 weeks is the target, but it can’t commit to it.
The company tells customers, “We will keep communicating to you, but things are out of our control now,” she said. “And you know, that doesn’t feel good when you’re writing a check for a few million dollars.”
Bruce Geiselman, senior staff reporter
Karen Hanna, senior staff reporter
Lynne Sherwin, managing editor
Contact:
Absolute Haitian, Worcester, Mass., 508-459-5372, www.absolutehaitian.com
Arburg Inc., Rocky Hill, Conn., 860-667-6500, www.arburg.com
Conair Group, Cranberry Township, Pa., 724-584-5500, www.conairgroup.com
Engel Machinery Inc., York, Pa., 717-764-6818, www.engelglobal.com
Entek Manufacturing, Lebanon, Ore., 541-259-1068, http://entek.com
Jackson Machinery Inc., Port Washington, Wis., 262-284-1066, www.jacksonmachinery.com
Krauss-Maffei Corp., Florence, Ky., 859-283-0200, www.kraussmaffei.com
LS Mtron Inc., Norcross Ga., 678-395-4389, www.lsmtron.com
Sepro America LLC, Warrendale, Pa., 412-459-0450, www.sepro-america.com
Uniloy Inc., Tecumseh, Mich., 517-424-8756, www.uniloy.com
Wittmann Battenfeld Inc., Torrington, Conn., 860-496-9603, www.wittmann-group.com
