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Brands, Co-Packers Contemplate the Role of OEMs During COVID-19

These CPGs are asking machine builders for clear communication as they maneuver a new supply chain, new material and consumer demands, and a new workforce.

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The PMMI virtual Executive Leadership Conference (ELC) in April brought together three representatives from CPG companies who shared their experiences on the manufacturing and packaging floor during the pandemic, while offering advice to OEMs on how to help with their future needs.

The panel, moderated by Packaging World editor Matt Reynolds, included:

Lisa Rathburn, vice president of engineering and continuous improvement for T. Marzetti Company, which makes products for both retail and restaurants, and is in the midst of major expansion projects across several plants, adding nine manufacturing lines in a 12-month period.

Mark Mikol, senior director at Schwan’s Company which, now an affiliate of South Korea-based CJ CheilJedang (CJCJ Food, Americas), is also in expansion mode which includes building state-of-the-art production and packaging facilities with an investment in automation.

And Rick Rice, a controls engineer at Crest Foods Co., Inc., a manufacturer of consumer products with a global dairy stabilizer business, and which also has a large contract packaging division.

The conversation touched on the typical hot topics of remote access, managing inventory during supply chain disruptions, and virtual factory acceptance tests (FATs). But the panel also made a plea for more machine flexibility in order to handle different packaging materials, as well as help training the next generation workforce on existing machines, and, in general, just more transparency.

As an example, at T. Marzetti, there was a simple component needed for a control panel which is normally in stock, but this time around it was not available due to supply chain disruptions related to the pandemic. That resulted in engineers trying to connect across regions and with different distributors, working together to find out where they could source the component. “One of the things we’re trying to do is broaden our understanding of where there are limits in the equipment supply chain,” Rathburn said. “Our ask is for communication, so that we’re aware of any constraints early on. As OEMs start to see constraints in their supply, I’d like them to communicate it to us as customers so that we can plan around it.”

Supply chain disruptions also had a major impact on the materials side. “We’ve had a lot of material changes because of shortages, so as we’re thinking about new equipment we want that equipment to be flexible, and to be able to run slightly different specs of materials,” said Schwan’s Mikol. “So that’s one thing for the OEMs to keep in mind that was really highlighted to me as supply issues came in. If the board can be a little bit weaker, a little bit different type of grade or some other things, it’s important to make sure that your equipment is flexible enough to handle that.”


Managing equipment, materials, and FATs

In response to the CPGs’ requests for more equipment flexibility related to materials, an ELC audience member asked if the panelists ever discuss material changes with machinery OEMs? And, do they provide machine builders with material to test before moving into production?

As a former machine builder who moved to the end user side at Crest Foods, Rice acknowledged that the most frustrating thing about starting out a new project as an OEM is not knowing what material the machine will run. “You get three-quarters of the way doing your build and then find out, ‘Oh yeah, and we use metallized film,’ or ‘we use reflective film,’ and it really throws a wrench in the system.”


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