B&C Plastics: Highlighting competitiveness with the right ERP solution
Blow molder B&C Plastics was trying to survive in today's business world with yesterday's - and in some cases, last millennium's - management information technology. It went about as well as you'd expect. Then an investment in enterprise resource planning (ERP) software brought them up to date, fast.
February 1, 2013 by Mark Stephen, editor
There’s nothing wrong with writing things down on paper by hand — it’s how Shakespeare and America’s Founding Fathers did it, among others. But let’s face it: it’s no way to run a business in the Internet Age.
Pickering, Ont.-based B&C Plastics spent years learning this the hard way. A blow molder of HDPE containers, the shop was having trouble — to put it mildly — in the information storage and retrieval departments. Founded in 1984, the family-owned company still relied exclusively on antiquated manual systems to run a multi-million dollar business supplying dozens of customers, with 30-odd employees and six blow molding machines — with an average run of 25,000 pieces — in a 60,000-square-foot plant. “We were still using a pen and paper for most our record-keeping, which made it hard to access key financial statements when we wanted them,” said B&C’s general manager Marcel Kreitzer. And there were other, related problems “We had a cumbersome and inaccurate manual legacy accounting system, and no current, reliable basic data pertaining to inventory,” Kreitzer continued. “This deep lack of historical data made it hard to predict and manage seasonal spikes, and also difficult to schedule downtime and maintenance.”
A stop-gap solution just wasn’t going to cut it — not that B&C didn’t try. Kreitzer provided his own combination of Excel and Quickbooks for a time, but he would have had better luck trying to seal the leak in the Titanic with masking tape — it simply didn’t have the reach or sophistication required to turn the business around.
Information-wise, the company needed to get out of the horse and buggy era. The solution? A full-fledged ERP system to give management the accurate, real-time, hard data required to effectively and efficiently run the business day in and day out; more specifically, an off-the-shelf, configurable ERP solution tailored to the needs of a blow molder.
DOING DUE DILIGENCE
Before the solution, though, came the first step: Kreitzer, who spearheaded the project, convinced senior management that, despite the cost, implementing an ERP system was the key to ensuring B&C’s survival and long-term sustainability. That done, a simple Google search led Kreitzer to Montreal-based software provider CyFrame. Further investigation confirmed CyFrame as the right choice because Kreitzer knew he wanted an ERP system that had been created for blow molders. He also preferred an Oracle, true browser-based solution rather than a Microsoft-based system, which is typically less flexible with a much higher cost of ownership, since it’s installed on each employee’s PC and requires more IT administration.
Prior to investing upwards of $70,000 in a CyFrame system, though, B&C wanted assurance that CyFrame, a smaller firm in a field of larger players, was in it for the long haul. Kreitzer had a specific analogy in mind. “Once you fully commit to ERP, it’s a lot like poker; you have to go ‘all in’ and abandon your old manual, inefficient ways, so you’d better make the right choice,” he said. “Essentially, B&C was putting its entire business in the hands of its ERP supplier, so we needed to know it would work. CyFrame has a good track record within the plastics industry, and their test system gave us the opportunity to try it out and get to know it.”
Having been green-lighted, the Oracle-based ERP system was installed in two months, beginning in May 2011 with CyFrame’s Financial Management, Inventory and Purchasing, and Production and Distribution base modules. In September, the Production and Shipping, and Barcode Scanning and Client Portal modules — complete with e-commerce capabilities — were successfully installed.
Key to selecting the CyFrame system was the tailoring to the specific needs of a blow molder. The level of tracking and traceability, for example, gives B&C an edge with highly regulated food and pharmaceutical clients who face rigorous compliance demands. “Our access to tracking and tracing data is already impressing existing customers, and we intend to leverage these capabilities when targeting new business down the road,” Kreitzer said. Credit CyFrame’s familiarity with the ins and outs of plastics processing here, which taught them about the need for specific features, functions, and parameters. As a result, clients like B&C are able to easily and cost-effectively personalize their off-the-shelf ERP by selecting from a menu with more than 600 features, functions, and parameters. As importantly, CyFrame populates all “menu” changes across all modules.
Another must-have: because B&C runs 24/7, its ERP had to have reliable, redundant backup system capability. CyFrame installed a backup server so that in the event of a catastrophic hardware failure, the backup takes over, limiting downtime to about 30 minutes.
Equally important, in a shop small enough that every worker is directly involved in production, the ERP system had to be accessible to all. “It had to be truly intuitive and user-friendly because every single employee has to use it regularly,” Kreitzer said. “CyFrame’s ERP interface is easy to use, and the icons do a good job of telling you what they do.”
An additional benefit: once the ERP solution was installed on the server, which is faster and more powerful than each employee’s PC, it eliminated inter-PC compatibility issues. “All of the data sits in one place, making it easy to support and backup,” Kreitzer said.
SOLD ON SOFTWARE
If you haven’t guessed by now, the investment has been a hit. “We’re running all of the more basic modules, and have minimized shipping errors, assessed scrap to identify mechanical and human errors, controlled and managed raw materials and inventory, and tracked and monitored equipment downtime and breakage,” Kreitzer said. “We experienced an almost immediate return to profitability and a seven-month return on investment.” Small wonder, then, that the company has plans to spend another $12,000 in the future to further tailor the system. This will include a secure, online, client log-in zone that will offer customers web access to their current and past orders, as well as billing information that will include customer-specific price lists to enable online ordering. Finally, B&C plans to give dedicated suppliers access to its raw materials inventory.
For Kreitzer and his co-workers, having ERP is simply the price of doing business in the modern world.
“Fifteen years ago, you might get away with doing things the way you always had, but in today’s fiercely competitive marketplace, we’re expected to hold the line on prices and survive by driving out excess costs,” Kreitzer said. “To make money in blow molding today, you need an ERP system.”