Like its globally recognized crystal and glassware, Arc International is transforming procurement into high art
From the exquisite to the essential, Arc’s glassware is the stuff of life. Since its 1895 founding in Arques, France, its artful and innovative creations have graced tables around the world. In palaces, restaurants, and home kitchens, legacy brands Luminarc, Arcoroc, Chef & Sommelier, Arcopal, Eclat, and Cristal d'Arques Paris are always de rigueur.
Millville, N.J., is home to the firm’s North American manufacturing and sales operations for Arc’s bakeware, foodservice, and tabletop glassware lines. There’s no shortage of artistry happening in Millville, but not all of it is a function of design and production. Frayne Ronkowski, the division’s director of procurement and strategic sourcing, is designing a procurement operation that aims to be as elegant, sustainable, and practical as the glassware shipped to retailers and restaurants across the continent.
“Tabletop glassware is very personal. You drink from it, it's on your kitchen table, you touch it every day. Because of that, quality is very important to the ultimate consumer,” he told BOSS. “Our raw materials set us apart; we have very low iron glass and use very high quality raw materials that lead to flawless final products. The clarity of the glass is what the customer sees and enjoys.”
In addition to raw materials, packaging is a key area of focus, whether items are sold on retail shelves under the company’s brands or through their burgeoning private label business. The procurement group is essential in the overall effort to produce the finest possible end product for the lowest overall cost, and packaging is an area where waste can live undetected. Ronkowski is streamlining process management techniques to consolidate the many variations in package designs and increase their volume purchases for many of their key brands.
Touchpoints & the power of procurement
“No matter what a procurement person touches they're going to pull value from it,” Ronkowski affirmed. “Historically, procurement reactively bought stuff. Now procurement changes things. We change the face of the company.”
Tasked with aligning the procurement function to Arc’s growth strategies, Ronkowski reported that a significant area of growth is seen in their private label segment of their consumer goods vertical.
“We also plan to continue growing our food service and are focusing on the growth of our e-commerce supply chain,” he said.
Arc is in the process of adding custom decorating capabilities through its e-commerce offerings. As Ronkowski put it, the key word in that new arena is speed. “We will have the ability to take an online order from for decorating and send it back out the door to the consumer within 24 hours, all through e-commerce.”
For the past 18 months, the company has researched digital printing and made a substantial technology investment to add clarity and speed to the custom decorating process. “Where that impacts procurement is the ability to better predict the market and stock the glass that the ultimate consumer will want to decorate.” Beer tumblers can be stocked for quick turnaround, and the firm operates a design department with 3D rendering capabilities. “We believe that gives us a competitive advantage. We're also looking at ways for the consumer to do the decorating themselves, get the final proof, hit go, and have a lot of control over the final product.”
Speed & Flexibility
Speed—and the potential for control over the finished product—is a boon for their domestic clientele. “We’re a North American business using American labor around the clock who can respond quickly,” Ronkowski noted. “There's a lot of value to that. We know our consumers want to have their products when they need them and they want to have control over the outcome, so ultimately, we need to be as nimble as we can be. Cutting waste out of the organization is key to attaining this speed.” Lean manufacturing principles and the company wide application of Kaizen methodologies are helping meet that challenge. Ronkowski is also examining improving the quality and cost of Arc’s decorating supply, bringing in a team leader for that purpose.
“In the past we looked at paints as storeroom material, as in, ‘We need more red.’ But we need to look at paints with a more critical eye from a procurement perspective,” he mused. Design trends also have an impact. For example, as the largest North American supplier of Candle Jars, Arc is constantly researching and developing new exciting ways to bring design elements to their products to enhance the visual aesthetics of the jars to complement the sense of smell.
“From the strategic side of procurement, we’re looking at decor to help us reduce costs and become more efficient there. For more of a traditional supply chain perspective, it comes back to how we forecast inventory and what glass needs to be decorated,” he said. In addition to custom designing and decorating beverage glasses for major league sports teams, alcohol producers, and other enterprises, Arc is turning their expertise to craft beer brewers of all sizes.
“If you're a craft brewery, you don't want a minimum order quantity of 10,000 glasses. You're going to want a smaller quantity on a tight turnaround time, and you'll want control of your design. If you want to order 2,500 glasses once a month and every month is a theme, Arc is ready. We've got the volume, experience, and history to be able to do it, and we're low-risk. If we need to, we've got manufacturing hubs in France, the UAE, China, and Russia to pull from.”
Ronkowski’s transformation of Arc’s procurement operation from a traditionally reactive position to being proactive is in full swing. Prior to his arrival at Arc, the procurement group was a typical “operational response” organization tightly focused on raw materials and packaging, with little emphasis on supplier development. A planned spring supplier summit was derailed by the novel coronavirus; nonetheless, his group is developing strong strategic communication strategies with key suppliers. “We asked them to come to us with ideas that can help us improve our lead times and improve our cost structure, and we received very good feedback from that. They have great ideas and are excited to work with us.” Plans for an autumn reschedule are pending.
Arc’s way of conducting business is as transparent as the glass they fire. “There will be times when we’re in a pinch and need our suppliers to move mountains to support us. That's recognized. Then there are going to be times where I have a lot of flexibility to help when the suppliers need it,” he stated. “We are all working for the consumer from one end to the other. As long as that person is happy and buying the product that's being manufactured, it trickles all the way back to the supplier who supports the process.”
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