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INSIDE

JUNE 2015

THE MIND OF

GOOGLE’S NEW CFO RUTH PORAT’S FINANCE STRATEGIES

TOP 10 FRANCHISE TRENDS ADAPTING TO THE MOBILE MIND SHIFT


DIRECTOR’S LETTER

LETTER FROM THE DIRECTOR If you are not familiar with the name Ruth Porat, the woman gracing our cover this month, you may not have been paying attention to the finance world for the past decade. And whether or not this removed state was a purposeful attempt to ignore the continued fluctuations exhibited by one of the most important industries in the world, let alone the U.S., it is time to wake up and smell the stability—and thank Porat, Google’s new CFO, for her role in securing this status. This month’s finance feature takes an in-depth look at Porat’s career and undeniable influence on the global finance world. Read more about this journey on page 6. In this issue, we also discuss the “mobile mind shift,” offering advice about adapting corporate marketing initiatives so as to optimize the increasingly powerful method of mobile marketing. Finally, we reveal the top 10 franchising trends surfacing in the U.S. today. From internationalization and crowdfunding to increased technology, these are 10 trends every franchisee – or potential franchisee – needs to know. E NJOY TH E I S S U E !

Jennifer White

Director of Content jennifer.white@wdmgroup.com

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CO CN OTNETN ETNST S FEATURES

6 Finance

Inside the Mind of Google’s New CFO

18 Marketing

Adapting to the Mobile Mind Shift

COMPANY PROFILES MANUFACTURING

LOGISTICS

38 Montrose Molders

84 Defense Logistics Agency [Association]

48 Revere Plastics Systems 56 Essel Propack Americas, LLC

HEALTHCARE 64 PAML

CONSTRUCTION 76 CenterPoint Properties

4 June 2015

EXPLORATION 94 Petro Star

RETAIL 102 American Apparel

SUPPLY CHAIN 110 PAPCO 120 Momentive Performance Chemicals

28 Top 10

Trends in Franchising Today


18 Adapting to the Mobile Mind Shift

64 PAML

76

Center Point

94

Petro Star

110 PAPCO

5


FINANCE

INSIDE THE MIND OF GOOGLE’S NEW CFO Ruth Porat’s Finance Tactics W R I T T E N B Y: T O M Á S H . LU C E R O

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June 2015


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FINANCE RUTH PORAT IS at the top of her game. Recently named Google’s CFO with an impressive salary, she is no stranger to success. In her previous role at Morgan Stanley, the number of achievements and accolades she received could easily take up the remainder of this article. Extravagant success, like the twinkling of the stars, always seems gratuitous once it’s consummated. And while a ray of starlight reaching the human gaze has been millions of years in the making, Porat has reached this pinnacle after mere decades. While the acceleration of Porat’s success is impressive, her ability to maintain success in the competitive field of global finance is inspiring. Throughout her career, Porat has been entrusted with the fate of major firms and has triumphed each time. Her recent appointment to the global tech titan further solidifies her role as a key player within the financial and business world—and one that we can all learn from. Career Overview Porat, 57, grew up in northern England as well as the United States. Her father was a research engineer; 8

June 2015

her mother, a psychologist. In 1987, after completing her undergraduate studies at Stanford and earning a pair of master’s degrees, Porat joined Morgan Stanley and “quickly became a mergers and acquisitions whiz before leaving for Smith Barney in 1993,” Politico reported. It was a rare career misstep for Porat, who immediately realized she wanted to return to Morgan Stanley, which she did in 1996. In addition to heading a pair of investment banking teams, Porat also vetted more than 750 internet-related IPOs between 1995 and 2001. Technology analyst and corporate ally Mary Meeker, wrote of Porat in a 1999 performance review: “She is the best banker I have worked with since Quattrone.” In 2000, Porat was sent to London to lead Morgan Stanley’s Technology Investment Banking Unit, successfully taking Amazon, Ebay, Priceline and Netscape public. She continued to work primarily as a technology banker through the Internet Boom, t transforming herself into a financial services banker once the sector collapsed. After the tech wreck, Porat began banking more blue-chip companies and assisted in the IPO of


INSIDE THE MIND OF GOOGLE’S NEW CFO

General Electric subsidiary, Genworth Financial Inc. In September 2003, she was appointed Vice Chairman of Investment Banking followed by an appointment to Chairman of the Financial Sponsors Group one year later. In September of 2006, she stepped down from Financial Sponsors Group to become Global Head of the Financial Institutions

Ruth Porat , New CFO for Google

Group, continuing with her successful ability to take companies public, including the Blackstone Group. Blackstone President Tony James described Porat to the New York Times as follows: “Unlike many bankers, she was able to quickly tap resources from all corners of Morgan. For instance, she arranged for Mr. Gorman, then head of strategy for Morgan, to speak to


FINANCE

Porat advised the U.S. Treasury on Fannie Mae and Freddie Mac during the financial crisis 10

June 2015


INSIDE THE MIND OF GOOGLE’S NEW CFO

Blackstone executives about what it was like to be a public company. I would never have even known to ask for that.” Perhaps the most challenging moment in Porat’s career came in 2007, when the sub-prime mortgage crisis torpedoed and nearly sunk the banking industry, along with Morgan Stanley. Porat truly shone during this moment. Along with fellow banker Robert Scully, she was tapped to advise the U.S. Treasury on the takeover of Fannie Mae and Freddie Mac, and the New York Federal Reserve Bank on AIG. And her efforts paid off: By the end of 2009, Porat stepped down as Global Head of the Financial Institutions Group and Vice Chairman of Investment Banking in order to assume her new role as chief financial officer FO, in 2010. Saving Morgan Stanley After the financial crisis, which destroyed rival firms like Bear Stearns, Morgan Stanley was still in deep trouble, and it was clear that Porat’s central responsibility as CFO was to put the banking giant back on solid footing. This was no small feat. Not only was Morgan Stanley’s liquidity

in peril, but public opinion was very hostile towards the banking sector. Repairing the damage that the financial crisis had inflicted on Morgan Stanley entailed a major revamping of the bank. Attempting to position itself as more of a steady producer than investment bank was a transitional move that carried with it considerable t risks, including a loss of $92 million in the third quarter. To achieve this significant move, Porat, along with Gorman, instituted a new strategy that, according to the Wall Street Journal, “prioritized steady results over the swing-for-the-fences traders’ mentality that ruled Wall Street in the previous era. “Under [CEO James]Gorman and Ms. Porat, Morgan Stanley shed billions of dollars in assets tied to riskier businesses, including its debt-trading arm, improved the firm’s key capital ratios, passed the government’s stress tests and began returning billions of dollars to shareholders through buybacks and dividend increases.” Five Lessons from the Financial Crisis Porat was a key player during the 11


FINANCE

Porat cut her teeth at Morgan Stanley, photo: Bastian Kienitz/Shutterstock.com

global financial crisis, and had key roles in assisting corporations’ ultimate success. As described by Jeffery E. Garten for Yale School of Management: • As global head of financing institutions investment banking, Porat helped banks on both sides of the Atlantic to “re-equitize” by raising equity capital. • Since Porat worked for both the 12

June 2015

corporate world and the government during the crisis, she gained a complex perspective on that period. During an with Garten, Porat offered key lessons to be learned from this crisis: 1. Durable liquidity is essential for banks and for a financial system in general “There’s no question that capital is the first line of defense but if you


D O Y O U W A N T T O F U N D A S TA R T U P ? R E A D T H I S F I R S T.

don’t have ample liquidity and it’s not durable, in times of stress as you’re looking for liquidity, you’re forced to sell assets at declining prices which then eat into your capital position, so it becomes this very, very negative cycle. There’s no question that liquidity is sacrosanct. That’s the way I think about managing Morgan Stanley from a liquidity risk management perspective.”

2. Leadership has have courage based on experience and instinct “Events move far too quickly during a crisis and what you’re dealing with is typically, as we called it back then, the least-worst option. There are no good options in the midst of a crisis. And so having experience in capital markets, having a team with experience in capital markets 13


FINANCE enables you to be nimble, creative, try different approaches and try and optimize within this bucket of the least-worst.”. 3. Time is your enemy in a crisis “[Then-Secretary of the Treasury] Hank Paulson once said to me, ‘You have to have the will and the means and too often by the time you have the will you no longer have the means.’ I think he was thinking of the U.S. when he said that but probably the best example is what happened with Greece, where what should have been a small, containable problem—because there wasn’t the will to deal with it up front—spread to the periphery and then we were talking about ‘What about Italy, Spain, Portugal?’—a much broader problem. So recognizing that time is your enemy is very important.”

Time is your enemy in a crisis

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4. Communication is key “If you think that you are dealing with least-worst choices and that there are some tough questions that need to be made, trying to provide clarity to all core constituents who need to make some of those choices is key, clearly not over-selling because


F E AT U R E A R T I C L E S H O R T E N E D H E A D L I N E

The role of the CFO is changing these situations unravel quickly and credibility is binary. You can’t lose it because you can’t regain it. And so again, communicating where you’re going so that you have enough confidence conveyed that there are tools that you can use and that choices are being made.” 5. The biggest lesson of all: the role of the CFO is changing

The role of the CFO has changed broadly since the financial crisis, Porat explained to Yale. “[The] role of a CFO was much more about the controllership function… and what the crisis really required was a big broadening of that role. So today for me, obviously the controllership element, the guardianship element is central to what we’re responsible for but understanding regulatory 15


FINANCE requirements and ensuring that we’re positioning for them, relationships with regulators globally is key.” Two Concerns for the Future Thinking forward 10 years, Porat also revealed her gravest concerns concerning the finance industry during her interview with Yale. 1. Potential risk within central clearing and central clearinghouses “One of the most important elements of Dodd-Frank was derivatives reform and the move to central clearing because it results in driving standardization of product and transparency, but we’re moving literally trillions of derivatives, notional value, to clearing houses so we need to ensure that we have proper risk management.” 2. Mispricing of student lending? “In the government student lending program, we now have over $1 trillion dollars funded by the U.S. government associated with student lending. That’s up fourfold since 2004 and one of the prime assumptions 16

June 2015

for the Congressional Budget Office in assessing the program is that there’s no default risk because the government can garnish Social Security and wages.” Four Priorities for the Future 1. Assess how the recent regulation of Wall Street will work out, whether it’s balanced or not “Let’s make sure the rules work well together and let’s make sure there’s no opportunity for financial regulatory arbitrage on a global basis.” 2. Manage the risk that is being created and is not affected by regulation “There’s quite a bit of lending product that’s moving out of the regulated world and I’ve already commented on the really big risk, the trillions moving into clearinghouses and the imperative that we start early to look at risk management protocol within clearinghouses and make sure we have high standards.” 3. Pay attention to cybersecurity as an emerging risk


INSIDE THE MIND OF GOOGLE’S NEW CFO

Cyber Security

“For cyber-security what’s imperative within the financial system is this: we can’t operate in a silo. The financial markets are not just about the financial players themselves but we’re reliant on the energy grid, we’re reliant on the communications grid. So there’s again an entire ecosystem upon which we rest and when you think about cyber-security the threat to any institution can come from any

place where there is a touch point.” 4. Continue to reinforce the lessons learned from the crisis “’Liquidity is sacrosanct; liquidity risk-management is paramount; how do you build a durable institution? How do you ensure you have a long runway?’—are lessons we will never forget.”

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MARKETING

ADAPTING TO THE MOBILE MIND SHIFT HOW BUSINESS CAN PREPARE FOR THE “MOBILE MOMENT” W R I T T E N B Y: T O M A S H . LU C E R O

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MARKETING TAKE A GOOD look at the nearest smartphone available. That rectangular device is spilling with possibilities to reach your end consumer. It is equipped with technologies that will tell you where your customer is and when she is near your product. Now take a good look at your marketing budget. On a pie graph, a dutiful graphic designer has color-coded the percent of your marketing budget aimed at mobile marketing. Maybe it’s 15 percent. The title of your pie graph is “Digital Marketing.” Along with mobile marketing, you are lumping together website, email, app marketing and other categories. One more thing: take that pie graph and rip it to pieces. In today’s business world you need an entire budget devoted to mobile location marketing, global marketers believe. “Mobile” is no longer just another “channel,” a part of your digital marketing strategy. It is its own strategy, its own channel. According to Susan Ask, of Forrester, industry leaders will heed this advice and thrive and laggards will relegate themselves to a constant game of catch-up. Will you lead or lag? Here at Business Review USA, we know our audience leads. 20

June 2015

A portrait of the past. The consumer

The reason for the urgency to stop thinking of mobile as “just another channel” to advertise is due to the fact that the market is experiencing a paradigm shift. Smartphone technology is the driver of this shift in consciousness. Thanks to GPS, which is intricately linked to locationbased marketing, mobile phones can pinpoint a customer’s location as well as notify a retailer when she is in the vicinity. The effect that this technology has created is called the “mobile mind shift” according to Forrester Research and is defined as “the expectation that


is moving from PC to mobile device.

I can get what I want in my immediate context and moments of need.” Forrester also says: “Your customers and employees are making this shift, now. This shift means the battle for your customer’s attention will be waged in ‘mobile moments’—anytime that customer pulls out a mobile device.” The ubiquity and dominance of the smartphone has created the need to think of it as its own channel on the digital marketing agenda. Leading thinkers in digital marketing believe that the “mobile moment” will be—or already is—the main vehicle

through which a consumer will make transactions with a business. It’s incumbent on modern organizations to build the infrastructure to help their organizations become capable of capitalizing on “mobile moments” instead of being passive spectators of the mobile moment phenomenon. This will not come cheap. “Leaders will use mobile to transform both their customer experience and their business. They will anticipate the needs of their customers and engage them at exactly the right moment with the right content 21


MARKETING

Beacon technology senses coming customers

and services…Doing so will require massive spending in the tens if not hundreds of millions of dollars to put the infrastructure, technology, processes and organization in place to engage consumers in their mobile moments,” according to Forrester Research. The degree, to which a business makes itself present when a customer wants information or service in a mobile moment, is the same to which a customer will begin a relationship 22 June 2015

with a brand, depend on it and, ultimately, become loyal to it. The job of the modern marketer is to be there. The mobile moment is the brand’s time to shine. A mobile moment is not a sale opportunity, though it can be. Instead, it’s a branding relationship that will engage your users as opposed to the way television commercials deliver content where clients are passive absorbers. In the mobile moment the


TRENDS SHAPING MOBILE COMMERCE IN CANADA

customer initiates the contact when he takes out his device to do something that is important to him. In this scenario, the customer will not always use a mobile device to purchase a product or service. Instead, he will use it for a variety of other things like checking the weather, playing a song, look for directions and so forth. Each of these is a mobile moment. Leading marketers already work with other firms in order to share mobile

moments. At any given moment, a customer may not use his smartphone to access your company’s brand. The customer may be searching for, or doing something else entirely. This doesn’t mean that your company cannot make an impression at the mobile moment. Forrester refers to this type of sharing and linking with other firms as building an “ecosystem of partners to engage consumers.” 23


MARKETING

A woman borrowing something from a man “Consumers spend most of their time on mobile phones in apps. They spend the majority of that time in relatively few apps. Each brand cannot expect every consumer to download its app. They must go engage consumers where they are. For example, a consumer can check the status of a United flight on TripIt. Here, United Airlines borrows a mobile moment from TripIt. Or, the same 24

June 2015

consumer can book a ride with Uber on the United app. In this case, United lends a mobile moment to Uber,� states Forrester on their website. Your organization must stop doing two things to begin building for mobile moment marketing. First, stop treating mobile as a squeezed down version of the PC experience or a portion of your digital strategy. If you continue to do this, you will fail to optimize the use of


ADAPTING TO THE MOBILE MIND SHIFT

mobile for your overall business and fail to serve the needs of consumers. Second, stop acting like a destination. Don’t expect all consumers to download your app or visit your mobile website. Instead, borrow mobile moments and engage with customers where they are. Use mobile to transform your business model. “Mobile will both change the cost structure and revenue models for businesses. The opportunities are vast, here are a few examples. On the cost side, mobile will streamline processes. Field service and sales personnel will use apps to file claims, get assignments or make sales. On the sales side, in-app purchases— for example, $4.99 for an EKG interpretation from a cardiologist through AliveCor or usage-based sales—for example, Progressive Insurance and Merck—will create net new sources of revenue,” writes Forrester. Inside American Airlines Idea Cycle To further illustrate how marketing works in the era of the mobile mind shift, Forrester Analyst Ted Schadler explains the example of American

Airlines, in a video. According to Ted Schadler, there is no one more mobile than a traveler. From the moment a traveler leaves his home en route to the airport to when he finally settles in their hotel room, there are dozens, if not hundreds, of mobile moments that can be capitalized on. According to Schadler, how to serve customers during all of these moments is something American Airlines—one of the most successful users of mobile marketing—has thought about a lot. Phil Easter, Director of Mobile Apps for American Airlines, was building mobile applications for the traveler back in 2009, including mobile services such as checking the status of a flight, getting directions to gates, upgrading services and so forth. Easter identified the traveler’s mobile moments, designed a mobile engagement, engineered all the services to support that engagement and analyzed the results. These four steps: identify, design, engineer and analyze are recognized by Forrester as the Idea Cycle. It turns out that the Idea Cycle is the best business discipline to create a mobile engagement, or serve somebody in that mobile moment of 25


MARKETING

American Airlines is a leader in mobile marketing. Phillip Lange, Shutterstock.com 26

June 2015


ADAPTING TO THE MOBILE MIND SHIFT

need, according to Schadler. American Airlines is estimated to have spent 80 percent of their budget to build the applications needed to serve somebody in the mobile moment. There are additional elements that contribute to capitalizing on mobile moments. There’s a cross-disciplinary team with people from business, marketing, design, developers and technical staff, all in coordination. Maya Leibman, the CIO at American Airlines runs a steering committee to prioritize things and keep people on a pace of steady evolution. According to Schadler, American Airlines has 350,000 travelers every day. 10 percent of them use a mobile boarding pass and that number is rising fast. People with the mobile app log in on a travel day ten times as often as they would on the American Airlines website. Clearly, there are higher levels of engagement with mobile. So as you think about creating the infrastructure to be able to serve customers during their moment of need—the mobile moment—having a discipline approach that brings a company together to achieve outcomes like American Airlines’ is a powerful and important way to serve customers

when they need you most: the mobile moment. Technology has taken us very far in many fields of life. Business is one of the beneficiaries of the technological watersheds of the last thirty years. Marshall McLuhan, the cultural critic, once explained that each technological advance—from the first bone used to crush walnuts to the latest edition of the iPhone—is a Faustian bargain. We trade one form life for another. Luddites understood this and after making their own costbenefit analysis they attempted to opt out of the Industrial Revolution. Many Luddites eventually became converts to industrialism and they received the advantages of it. Luddites who held on to their position lived on, but missed out on the age’s benefits: a tough choice. Business is once again at this crossroads of change versus constancy. Reorganizing one’s self to capture mobile moments is a longterm, challenging task. Businesses can choose to do their work the way they always have, or they can transform into mobility. In either case, the mobile moment is here and the mobile mind shift has already taken place.

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TOP 10 TRENDS IN FRANCHISING TODAY Plenty Happening in the Franchise World Written by: Tomas H. Lucero

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Franchises are a crucial segment of the American economy. They are important job creators and entrepreneur builders. Many of the jobs created coming out of the Great Recession are tied to franchises. American franchises are still the most prominent and popular in the world—particularly food franchises. They also account for a substantial, if not most, of the small-businesses in the nation. It is because of their volume and ubiquity that so much happens in the sector at any given time, from new franchising niches to new finance methods. In this article, Business Review USA brings you a survey of the most important trends in franchising today.

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Increased Technology in Franchising

Technology has made business easier for everyone. Certainly the most significant concept taking root with franchises is the ubiquity of software services hosted in 30

June 2015

cloud, or simply, software that’s not installed on a computer, but instead resides on the web. Likely you’ve heard of cloud computing and Saas (software as a service.) The aim is to take all the software programs that are usually installed on a company’s individual computers and move them to the web. There, they are hosted in a single secured environment and accessible from any Internetconnected device, be it a computer, phone, or tablet. Since franchises command so much volume by virtue of their size, even small franchises need sophisticated systems to manage the complexity of their trade. Software solutions including Nextstep Systems, VST Inc., Hello Scheduling, ONOSYS, Stellar Restaurant Solutions, Mindshare A consumer pays an account with his smartphone


T O P 1 0 T R E N D S I N F R A N C H I S I N G T O D AY

Technologies and Venuelabs have filled some but not all needs.

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Increasing minorities and women in franchising Franchising mitigates traditional obstacles to minorities and women such as lack of business experience and capital. According to yourfranchisesuccess.com, “Franchisors provide managerial training and assistance on an on-going basis and, in some cases, arrange for property leases, provide equipment financing and sale-leaseback programs, and assist franchisees in obtaining financing.” The growth in

By buying a franchise, minorities can avoid traditional barriers like lack of business experience and capital

population of minorities is a factor pushing this trend. Quoted in CNBC, Rohit Aurora, CEO of Biz2Credit, states, “’Minorities are going to become the majority in the next 5 to 10 years in terms of small businesses. They will keep contributing in starting, buying and growing businesses.’” For many of these coming entrepreneurs, franchises will seem like the ideal small-business opportunity. It’s not just their growth in population, however. Baby Boomers are retiring and handing off their franchises.

08

Internationalization of Franchises

Overseas markets are still ravenous for American products and services. Franchise experts believe that many countries are willing to pay large amounts for the opportunity to use a Western trademark and the training and knowledge that come with the package. There are well over 400 franchises operating 31


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internationally, according to the International Franchise Association. Another cause pushing this trend is the Franchise Trade Commission, a program under the U.S. Commercial Service, which facilitates business deals for American companies abroad. Entrepreneur reports that: “An early franchise trade mission in 2011 saw 15 companies, including Applebee’s and RadioShack, travel to Mumbai, Hyderabad and New Delhi to meet with potential partners in the Indian market. Since then, the Commercial Service, which has staff based in most U.S. embassies around the world, and its partners have facilitated missions to China

Well over 400 American franchises are operating internationally

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and to countries in Southeast Asia, Latin America, the Middle East and sub-Saharan Africa. This year it plans on returning to India and Southeast Asia.”

07

Franchising in “Faster Than Fast” Food

Just when we thought it was impossible to get food to a consumer faster, it got faster with food trucks. According to QSR Magazine, 5 of the top 20 food truck franchises are Skillet, Chef Shack, Food Shark, Coolhaus and Spencer on the Go! The markets for food trucks include business parks, transit areas, tourist spots, sporting, cultural and other entertainment events, tertiary education institutions and even wedding receptions, according to Franchise Finder. The startup capital in food trucks ranges from $50,000 to $250,000. According to mobile-cuisine.com, “If you go [all] out, buy a new food truck with all new high end equipment and technology, you’re looking at about


T O P 1 0 T R E N D S I N F R A N C H I S I N G T O D AY

An average investment of $150k will get you started in the food truck business, photo Jeff Whyte, Shutterstock.com

$250,000 in operating capital and start-up costs.If you go the other route and get extremely frugal and able to do some of the build out work yourself, you can probably get away with $50,000 to $75,000.” At Entrepreneur.com Food Truck Franchise Group LLC states that a total investment of $99,000 to $150,000 will get you started with them.

06

Franchisors buying litigation insurance

There are economic and legal reasons why this is a current trend in franchising. According to Bloomberg, “As a rule, franchise lawsuits tend to follow economic cycles, says John

Gordon, principal at Pacific Management Consulting Group, which focuses on the restaurant industry. In a bad economy, franchisers may put the squeeze on franchisees, leading to lawsuits; or a store owner whose business sinks may seek to blame the corporate chain. As the economy improves, protection against such lawsuits may be less important.” While the worst of the 2008 Great Recession is behind us, the economy has still not recovered its pre-Recession strength. Legally, recent decisions by the National Labor Relations Board have made it easier to sue franchisers. In a case involving McDonald’s, “The top prosecutor for the federal labor board has rejected McDonald’s claim that it’s not the boss of the workers in its franchised stores,” according to Bloomberg.

05

Crowdfunding in franchising

This trend comes out of another one, the trend born from the Great Recession, which cut off equity 33


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lines of credit as a traditional source of capital for franchisees. Investment crowdfunding expands the class of individual likely to invest on a small business. According to Mark Mohler in his article at The Crowd Café: “Facebook shows that Americans follow their favorite brands— millions of cumulative likes and shares—and crowdfunding can enable them to invest in them too. Fans can become actual co-owners. And of course, it’s not just the brand they’ll be investing in, but also the individual behind it.” Federal legislation has given this kind of crowdfunding a boost. The JOBS Act, signed in 2012, included a provision that makes it legal for small businesses to solicit crowd-based investments up to $1 million.

04

Franchising in fitness gyms

Fitness gyms are another franchise concept that Baby Boomers are fueling. This generation 34

understands something fundamental about fitness that escaped their parents: exercise must be done on a regular basis to work. As a result, gyms work because consumers are keeping their memberships. Also, since self-care is important to Baby Boomers, franchises that provide one-on-one training are particularly successful with this demographic. With their parents well-cared for and their bodies in their best shape ever, the last Baby Boomer priority is looking good. They spend a lot of money in medical spas, salons, cosmetic stores, massage studios and tanning salons. The still-growing healthy living and aging industry generates about $480 billion annually.

June 2015

Gyms thrive because Baby Boomers understand the importance of regular exercise


T O P 1 0 T R E N D S I N F R A N C H I S I N G T O D AY

03

Franchising in home health care

The spending power of Baby Boomers has always been touted. At their current age—they are between 51 and 69—their needs revolve around three themes: caring for their parents, fitness and looking beautiful. Successful franchising opportunities fulfill these needs. To care for their parents, they are turning to home health care franchises like Home Health Mates. Baby Boomers are living more active lifestyles. This is why they’re outsourcing care for their parents to third-parties. Home health care franchises are not tied to the economy. Consumers can wait to buy a new car, but they can’t put off care for their loved ones.

02

Multi-unit franchisees

Traditionally, franchisors have wanted to work with franchisees

that promised to concentrate on their brand and their brand only. This is no longer the case. Today franchisors are more interested in experienced operators. Quoting their president Michelle Rowan, Franchise Business Review writes: “’Multi-unit ownership’s growing appeal is the result of two factors. Franchisees enter into it due to the potential for increased profitability. Franchisors are encouraging it because well-financed and experienced franchisees can expedite growth, while keeping the number of franchisees they work with manageable.” The median annual pre-tax income of the multiunit franchisees Franchise Business Review surveyed was $88,000, as 29 percent earned more than $150K and 16 percent earned over $250K. By contrast, 11 percent of single-unit franchise owners earn more than $150K and only 4 percent earn over $250K.”

01

Franchising in fast casual restaurants

Fast casual restaurants have hit a 35


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sweet spot with consumers. Diners like customizing their meals as well as the made-to-order signature dishes that these restaurants offer. Fastcasual.com reports high demand in the sector: “For the second year in a row, the fast casual sector was the growth engine of the U.S. restaurant industry, according to Technomic’s Top 500 Chain Restaurant Report. It found that fast casuals increased their collective annual sales by 12.8 percent to $30 billion in 2014, and that growth rate was nearly double the next-largest increase from any other restaurant segment.” Fastcasual.com also reports that: “Jersey Mike’s Subs increased its sales 30 percent to $523 million in 2014, ranking just ahead of Dickey’s Barbecue Pit, which recorded a 29-percent gain and $426 million annual sales. Even off a 10-figure base, Chipotle Mexican Grill increased annual sales 28 percent to $4.05 billion.”

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T O P 1 0 T R E N D S I N F R A N C H I S I N G T O D AY

The fast casual restaurant industry increased its annual sales by $30 billion in 2014

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Montrose Molders Corporation Injecting quality and service into every part Montrose Molders leads the way in the injection molding and production industry by offering its customers diverse options and services. Written by: Cutter Slagle Produced by: Brian Mooney


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M O N T R O S E M O L D E R S C O R P O R AT I O N

It’s important to come to work and feel as if you’re a part of the team, as if everyone is working together to achieve a common goal,” said Brendan Wilson, vice president of operations at Montrose Molders. For 40 years, Montrose Molders has been in the business of custom injection molding solutions. The Piscataway, NJ-based business is about more than its tools and equipment: the family-run company also believes in providing a strong family culture. Through its focus on communication, quality, and exceeding expectations, Montrose has succeeded in doing just that: 40

June 2015

making both employees as well as customers feel right at home. The path to growth: “A diverse offering equals success.” Montrose Molders began its journey in 1966 as a 22-person tool shop, specializing in the manufacture of tight tolerance tools for the injection molding industry. It was in 1972 that the company invested in their first injection molding press: since then, the company has made it a priority to diversify its offerings to its customers. Today Montrose Molders prides itself on being a “one-stop shop” where customers


M A N U FA C T U R I N G

can fulfill a wide variety of needs. Customers at Montrose Molders can choose from a broad range of services, going beyond injection molding to include tooling, part decoration, and assembly. According to Wilson and Todd Nicolay, Montrose Molders Vice President of Sales, it’s all of these different services combined that contribute to Montrose’s success. “A diverse offering equals success,” mentioned by both Wilson and Vice President of Sales, Todd Nicolay, is a perfect mantra to describe part of the company’s philosophy toward providing

consumer satisfaction. The ability to offer customers a wide variety of options and solutions, along with providing every tool a client could possibly need for a single project all at one location, has ultimately allowed Montrose to stay relevant— even through harsh economic times. With 51 injection molding presses that vary from 50 tons to 1000 tons, Montrose has the capability and the capacity to execute projects of a wide variety of sizes and complexities. When it comes to tooling, their 50 years of experience enables them to design and build tools in a board range of industries, w w w. m o n t ro s e m o l d e r s . c o m

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Brickforce Staffing “Effective Workforce Systems”.

2 Ethel Rd. Suite 204B Durham Center Edison, NJ 08817 Phone: 732-819-7770 Fax: 732-650-0360

Contact us 24/7 at: jeff@brickforce.com


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ith 28 years of experience and thousands of temporary and regular full-time placements annually over a broad range of Fortune 500, mid-sized, and small companies, Brickforce Staffing is recognized as a full service staffing company specializing in light industrial temporary labor. We excel in providing cost-effective staffing solutions.

www.BRiCkFoRCE.Com


SUPPLIER PROFILE

BRICKFORCE STAFFING

Brickforce Staffing is privately owned with 17 branch offices located throughout New Jersey, Pennsylvania, Tennessee and Indiana. We attribute much of our success to our ability to draw production workers from our many offices. Our highly experienced managers coordinate the entire process from employee recruitment, to their on-time arrival at your worksite. Our extensive recruitment network throughout the region enables us to avoid shortfalls in quantity and quality satisfying our clients’ needs every time. The majority of our workers are attracted to Brickforce because of our reputation as a leader in the industry. Brickforce temporary associates are ready and willing to work any shift, including holidays, weekends and overnights. With more recruiting offices than any other light industrial staffing service in New Jersey, our temporary associates are only minutes away from any of your company’s worksites. As a full service staffing firm, Brickforce is successful at assigning highly effective personnel to temporary, temp-to-hire and regular full time positions. We staff from entry level up to senior management, warehouse / manufacturing employees, as well as general office / clerical positions. Brickforce Staffing is dedicated to bringing skilled individuals and companies together in a partnership that works -- a compatibility that ensures success for our client as well as for the employee. Twenty-eight years of experience have given us the ability to provide your company with the highest level of service in the temporary labor industry- making us the largest temporary staffing provider in New Jersey. www.brickforce.com


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MFG

often on tighter than average lead times. Assembly has also become a popular service, as customers can choose to receive assistance with the decorating, packaging and, assembling of different projects that include hot stamping, pad printing, heat bending and more.

project management, and the latest engineering technology. This begins with a full service in-house tooling design and engineering department to help clients bring even their most complex injection molding ideas into reality. That process is supported by the assignment of a personal project Valuing Customers: The manager to follow each project. Montrose Way As the company has stated, “We Montrose Molders values its believe that thorough, continuous, customers, and understands that, and honest communication is while each customer is different, necessary in order to properly each one should be given all the help manage a project in our industry.” they need for a successful outcome. The project managers that “Customers are king,” Nicolay Montrose assigns its clients are said. This notion is the seed for the highly trained to understand the adoption and execution of what’s manufacturing process, capable known throughout the company of relaying the scheduling realities as the “Montrose Experience” or of production and logistics to give the “Montrose Way.” The Montrose clients the clearest picture possible. Way pays heed to providing This process helps clients feel consumers with three important supported and keeps the lines of deliverables: quality, superior communication clear all the way

“The company started as a family business,” Wilson concluded,” and it continues to grow as one” – Brendan Wilson , VP of Operations w w w. m o n t ro s e m o l d e r s . c o m

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from order placement to final delivery. The last deliverable of the Montrose Way is quality—and at Montrose Molders, the ultimate benchmark of high quality is high customer satisfaction with the finished product. Montrose Molders strives to exceed customer expectations in this field with a rigorous Quality Management System—a system that trains its Quality Assurance staff to not just maintain the status quo, but to continuously monitor operations to identify areas where quality and production processes can be improved. The company also 46

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engages its customers in the process directly, using that open line of communication to establish and clarify those expectations so that it can always evolve and improve. “Because we’re a custom injection molder, it’s critical that we customize our quality oversight to each customer and to each job. Our Quality System allows us to do that,” said Wilson. “Montrose Molders Corporation is committed to the improvement of the quality of our product and the way we do things because we understand that the satisfaction of our customers is essential to our growth and survival as a company. We provide the


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necessary tools and resources to employees, in all aspects of the business, so that they may continuously improve Montrose’s processes and products and implement improved technology in an effort to meet the challenges of the future.”

Company Information INDUSTRY

Manufacturing

A LEAN journey into the future For several years now, Montrose Molders has been on a “LEAN” journey. The company has been incorporating ideas of the lean manufacturing business model in an effort to eliminate unnecessary waste. This process has helped Montrose Molders to deliver products that are both high quality and efficiently produced. When asked about future changes of the industry, Wilson noted the appearance of reshoring as a major trend: after decades of outsourcing, more and more injection molding work is actually coming back into the United States. As work that was once being conducted in China and in other countries overseas is now returning stateside, businesses like Montrose Molders are finding new client opportunities and further potential for growth. That is a crucial part of the future of Montrose Molders: the company is expected to keep growing and expanding. Bringing the conversation full circle, Wilson contributes one major aspect of this growth to the family culture of the business. “The company started as a family business,” Wilson concluded,” and it continues to grow as one.”

HEADQUARTERS

25 Howard Street Piscataway, New Jersey, United States, 08854 FOUNDED

1966 EMPLOYEES

201-500 REVENUE

Did not disclose

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Revere Plastics Systems LLC Offering the Whole Package

Revere Plastics President Glen Fish discusses growth, development, and the client benefits of offering a one-stop shop Written by: Sasha Orman

Produced by: Jason Wright


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REVERE PLASTICS SYSTEMS LLC

Investment in 6-axis robots enables Revere to provide greater efficiencies. In this product, Revere is manufacturing a wheel/roller assembly where it is molding the hub, pressing a bushing, overmolding the rubber wheel, assemble retention clips, and inspecting with vision system all in a one piece flow cellular fashion at Takt time with balanced operators.

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or more than 50 years, injection molding and design specialists at Revere Plastics Systems LLC has been in the business of helping clients achieve their manufacturing goals. Now the Ohio-based company is ready to scale up, with the capabilities and the drive to make that growth a reality. More than molding “At Revere Plastics Systems, we really like to focus on the ‘systems’ portion of our name,” said Revere President Glen Fish. Not content to provide injection molding services alone, Revere Plastic Systems prides itself on its 50

June 2015

multiple production facility sites, its engineering capabilities, and its fleet of nearly 300 presses ranging from 25 to 2,000 tons that support a variety of client needs. All of these assets allow the company to enhance its injection-molding core with a host of value-added services from welding and assembly work to supply chain management. “We can literally be a one-stop shop,” said Fish, noting the clear benefits that this competency provides to Revere’s clients. Beyond just manufacturing a part, Revere is able to follow that part from conceptualization through execution, with all the prototyping


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Revere adds infrastructure to support two 1880 and two 1500 ton presses. Revere is continuously looking to invest in additional capability to support our customer’s needs.

and tooling in between. “We are really like an extension of our clients, and that is the true benefit to them,” he added. “We have the expertise to manage all of those steps, and to go out and find suppliers that make the different components that we would assemble onto their parts. It helps them in their launch timeline, and it helps in the amount of effort they have to put into a product launch.”

to settle for making due with the technology it already has at its disposal. Over the years, Revere has committed to refreshing and updating operations with new and varied equipment to expand its capabilities. “We have definitely invested in our business,” said Fish—and in addition to investments in both new and used presses, Revere is also investing heavily in peripheral technologies to aid every point throughout Investing in technology operations. “We are in the midst of Revere Plastics Systems is not purchasing a 3D printer to allow us content to settle for providing to more rapidly prototype both parts service in just one aspect of injection and tooling so that we can make molding, nor is it a business content testing samples. We have made w w w. re v e re p l a s t i c s s y s t e m s . c o m

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REVERE PLASTICS SYSTEMS LLC multiple quality enhancements in terms of investing in process capabilities on our equipment—there is different technology in welding we’ve invested in, plus engineering technology, like IT capabilities and software to help our engineers resolve issues quicker.” Revere Plastics Systems also keeps its customers in mind with every investment. Fish added that Revere’s flagship location in Clyde, OH is currently undergoing a sizeable upgrade to add functionality for one of

the company’s largest clients. Investing in process and people Even the best equipment is only as efficient and effective as the team member operating it. So to build the most effective business possible, Revere Plastics System also works hard to drive efficiencies and improve operations in a variety of ways. The business has long been engaged in the Six Sigma process, also incorporating elements of the Toyota Production System to

Honored to be a part of the Revere Plastics team. Making a difference for every client, every day.

Call +1 (708) 345-5000 to talk to an expert.

Lockton® congratulates Revere Plastics Systems for excellence, innovation, and leadership in the manufacturing industry. We are continually striving to find ways to provide better, higher quality injection molds so that our customers not only feel proud of the resulting products, but also know their tooling was delivered on-time and on-budget. 1425 Armitage Avenue Melrose Park, IL 60160-1490 USA 708-345-5000 | fax 708-345-2089 www.a1toolcorp.com

WE LIVE SERVICE!

®

Insurance • Risk Management • Employee Benefits

444 W. 47th Street, Suite 900 Kansas City, MO 64112 • 816.960.9000

www.lockton.com

© 2015 Lockton, Inc. All rights reserved.

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streamline the different flows of the business. “We’re really focused on leaning out our facilities and taking out waste—we’ve put Kanban systems in place, self directed work teams, formal problem solving training and leadership training with our team leaders and front level supervisors, a lot of visual management and getting the operators more involved, and we’ve seen significant improvements in labor efficiency and in scrap reduction,” said Fish. “We’ve made huge strides in terms of quality, delivery, end cost through efficiency, and inventory reduction. So the lean efforts, between lean and Six Sigma, have been huge in our operational improvements.” In addition to improving efficiencies among its people, Revere is also working to improve communication and leadership among its people. “Our company culture is actually going through a renaissance,” said Fish. “Over the last year and a half we’ve really been emphasizing communication and teaching people the business side of things. They now are engaged in problem solving and continuous improvement—they have a voice.” Through exercises ranging from newsletters to skip-level management meetings, Fish explained that morale alignment and development at all levels has been improving dramatically. “We put a lot of emphasis on our people, and I continue to remind everyone they’re our greatest asset,” he said. “It’s just really about opening up lines of communication. We’re still in the midst of this

Revere actively develops and implements InMold Decoration (IMD) and In-Mold Labeling (IML) processes. In this application, post the IMD process Revere pad prints for additional part decoration.

“We’ve made huge strides in terms of quality, delivery, end cost through efficiency, and inventory reduction” – Glen Fish, Revere Plastics Systems President

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REVERE PLASTICS SYSTEMS LLC

Revere uses cellular manufacturing to produce two piece fuel tanks. In this example, Revere is molding 2 halves of a tank, vibratory welding, pressure decay leak testing, and packaging fuel tanks to ship Just-In-Time to customer.

culture change, but it’s getting better every day.”

While 50-plus years in operation could lead some businesses to rigid thinking and force of habit, Flexibility: the Revere Revere draws upon decades of difference experience and expertise to find Flexibility is more than just a fresh and creative solutions to fit property of plastic. It’s also a core into the requirements, budgets, and trait that sets Revere Plastics deadlines of any client. Systems apart from the competition. “We emphasize our flexibility: 54

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‘flexible thinking, design, and delivery’ is our mantra,” said Fish. “Being an engineering-based company— along with our willingness to be a problem solver—creates value for our customers. We can do things more efficiently because we can provide the full gamut of capability, from project management to sourcing to execution on the molding and assembly side and delivering a subcomponent as opposed to a simple ‘shoot and ship’ part.” Looking Ahead From 3D printing to projects that tackle converting traditionally metal items to lightweight plastic, Revere Plastics Systems had identified and is at the forefront of several industry trends through an increase in product development and R&D efforts. One rising trend in particular is a reshoring of the injection molding industry in the United States, and Revere is addressing this trend by turning its focus toward growth in the months to come. “That is the number one priority: growth and expansion of our customer base,” said Fish. “We are actively working on expanding our presence in different end markets—looking in the automotive industry, packaging, medical products—and trying to find out where additionally our services best provide value for our customers. We want to get the word out about what our capabilities are and how we can help people. We have several initiatives underway now to grow and really to better market who Revere is.”

Company Information INDUSTRY

Manufacturing HEADQUARTERS

401 Elm St. Clyde, OH, USA, 43410 FOUNDED

1960s EMPLOYEES

1,200 REVENUE

Not Disclosed PRODUCTS/ SERVICES

Plastics

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Essel Propack America

Breaking the Mold on Packaging For an expanding Essel Propack, there’s so much more to offer than just oral care packaging. Written by: Ian Hanner Produced by: Jason Wright


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Machine where shoulder is applied onto tube

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hen it comes to essential companies, Essel Propack occupies a slightly unusual space, where consumers rely on their products largely without even knowing who the company is. That’s a shame given the company’s great progression. Founded in 1984 in Mumbai, India, Essel Propack has carved out an impressive market share. But this consumer packaging company isn’t content to rest on its laurels. Essel Propack America (Essel) has been aggressively expanding its operations while expanding its 58

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product line. With a broad range of packaging products that respond to consumer demand, the company has come a long way since first entering the United States in 2002. “We realize as a company we need to demonstrate continuous improvements as our market is competitive and our customers are continuously looking for us to come up with ways to partner, to innovate in support of their new products and also to help manage costs for them,” said Ted Sojourner, regional vice president. For much of its history, Essel has largely focused on manufacturing


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Essel employees spelling EP for Essel Propack

packaging solutions for the oral care industry. According to Sojourner, the company currently supplies tubes for 50 percent of all oral care businesses in the United States that don’t manufacture in-house. This niche has built a solid business foundation. Despite that, the company has been exploring options for growth. Today, Essel has five core business segments: beauty and cosmetics, pharmaceutical and health, food, home and, of course, oral care. While oral care still makes up the bulk of the company’s business in America, Sojourner said the company is eager to expand, recently creating a new line of 2-inch tubes with applications in a range of sectors. One of its product lines is Egnite™, a “high-

“Growth is a spiral process, doubling back on itself, reassessing and regrouping” – Subhash Chandra, Chairman

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Aerial View of EP Danville

luster laminate available in a variety of shades. Its metallic foil enhances its ability to block while also offering a striking level of product differentiation. With material that provides a protective barrier and resilient bounce-back properties, it helps the tube maintain shape and form while also creating a distinctive aesthetic effect with a surface so lustrous that it is reflective.” The Egnite packaging line is perfect for products that are looking to be attention grabbing. Think bright golds in a sea of white or grey tubes. “With the look of metal and the feel of plastic, Egnite is a unique packaging differentiation that

Supply Chain Proud partner with Essel

Packaging Design and Color Development Innovation in Motion

How to ease the pain: Problem Solution

High Inventory? Long Lead Time? Volatile Forecast? Complex Vendor Base? Congested Dock Times? High Prices?

Colorants for the Plastics Industry www.carolinacolor.com

JIT Delivery Stocking Arrangements Planning Assistance One-Stop Sourcing Consolidated Deliveries Buying Power

SUPPLY RESOURCES

packaging design w Sourcing w

www.sripackaging.com

Distribution

Proud to be “Supplier of the Year” for Essel Propack


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grabs consumer attention,” Essel’s website said. “Its exceptional barrier (EVOH and MPET) is available in six high-luster shades and helps protect from counterfeiting.” Outside of appealing to consumers attention spans, another company line— Green Maple Leaf™— is appealing to their sense of environmental stewardship. The Green Maple Leaf packaging is 100 percent recyclable and protects from oxidization with a “proprietary water-barrier coated core layer and an all-polyethylene film multilayer laminate.” The line is specifically manufactured for cosmetics, toiletries and food products. The tube’s materials have “memory,” meaning once squeezed they return to their original shape. Green Maple Leaf is part of Essel’s ongoing commitment to reducing their— and by association their clients’— carbon footprint. “Green Maple Leaf supports and strengthens Essel’s Go-Green Initiative, ensuring that we are leading the way in making meaningful contributions for a greener, better, healthier planet,” according to Essel’s website. “Setting a new curve to packaging innovation, Green Maple Leaf is aimed at markets demanding sustainability by replacing EVOH tubes. It provides extraordinary product stability, shelf life properties, tube resilience and feel. Produced with fully recyclable thermoplastic polymers, Green Maple Leaf helps achieve the ultimate sustainability goal.”

Itaque consed quam aspero et modite

“We realize as a company we need to demonstrate continuous improvements as our market is competitive” – Ted Sojourner, Regional VP

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Another prominent line for the company is Etain. Also aimed at meeting the company’s sustainability goals, the tubes are fully-recyclable and manufactured with a certain level of recycled plastic, cutting down on the amount of virgin plastic that goes into Essel’s manufacturing process. The company says the product line is typically used to package a range of beauty and skin care, pharmaceutical and food products. While these represent some of the newest product lines from Essel Propack America, they are by no means the only successful ones. In 2013, the company’s Europe division was awarded “Tube of the Year” by the European Tube Manufacturer’s Association for “its stunning design reproduction, with color vibrancy and metallic sheen.” That tube is being used by L’OREAL for their new “EverRiche” line. Armed with these impressive offerings, the company is rapidly expanding from its regional base in Virginia. At 300 employees and over $70 million in revenue, the company has more than doubled in size in five years. Still, they show few signs of slowing down. In the company’s most recent annual report, Chairman Subhash Chandra said, “There is a saying: ‘Growth is a spiral process, doubling back on itself, re-assessing and re-grouping.’ Over the last six to seven years, Essel has done just that.”

Company Information INDUSTRY

Manufacturing HEADQUARTERS

187 Cane Creek Blvd. Danville, Virginia, USA, 24540 FOUNDED

2002 EMPLOYEES

300 REVENUE

$70 million PRODUCTS/ SERVICES

Consumer packaging

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PAML

- Pathology Associates Medical Laboratories

With a focus in diagnostics with national corporate headquarters in Washington, PAML is a recognized leader delivering healthcare solutions. Written by: Stephanie C. Ocano Produced by: Tom Venturo


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PAML Lab

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H E A LT H C A R E

PAML General Administration

Our goal is to do anything and everything to help you as a provider to succeed in delivering the highest quality of care. This is the ideology behind PAML (Pathology Associates Medical Laboratories) – a medical reference laboratory serving physicians, hospitals and allied health professionals. Ranked among the top clinical reference laboratories in the nation and considered an industry leader in joint venture partnerships, PAML is dedicated to personalized service, rapid turnaround time and innovative information management systems.

We recently spoke with Dr. Francisco R. Velázquez, President and Chief Executive Officer at PAML, to further understand the history of the company and his methodology to become a driving force in the healthcare solutions industry. From West to East – A History of Going Nationwide Founded in 1957 in the town of Spokane, Washington, PAML was initially focused on serving the Pacific Northwest region. From Montana to Idaho, the company soon discovered that its reach could extend much farther. Over the years, w w w. p a m l . c o m

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BreathTek® UBT for H. pylori

You Suspected H. pylori. BreathTek UBT Confirmed.

To be sure of your diagnosis AND confirm treatment success, choose BreathTek UBT • Antibiotic resistance is approaching 25%, increasing the need for eradication confirmation1-3 • ACG* calls the UBT method “the most reliable nonendoscopic test…“ to confirm H. pylori eradication4 • BreathTek UBT offers excellent sensitivity (96%) and specificity (96%) to confirm eradication in adult patients5 • False negative test results may be caused by: − Ingestion of proton pump inhibitors (PPIs) within 2 weeks prior to performing the BreathTek UBT. If a negative result is obtained from a patient ingesting a PPI within 2 weeks prior to the BreathTek UBT, it may be a false-negative result and the test should be repeated 2 weeks after discontinuing the PPI treatment. A positive result for a patient on a PPI could be considered positive and be acted upon − Ingestion of antimicrobials or bismuth preparations within 2 weeks prior to performing the BreathTek UBT − Premature POST-DOSE breath collection time for a patient with a marginally positive BreathTek UBT result − Post-treatment assessment with the BreathTek UBT less than 4 weeks after completion of treatment for the eradication of H. pylori • False positive test results may be caused by urease associated with other gastric spiral organisms observed in humans, such as Helicobacter heilmannii or achlorhydria.

H. pylori can’t hide from BreathTek UBT… Approved as an aid in the initial diagnosis and post-treatment monitoring of H. pylori infection in adults and children ages 3 to 17 years Please see BRIEF SUMMARY on adjacent page. Click here to learn more or visit BreathTek.com. *ACG, American College of Gastroenterology. April 2015

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Brief Summary about BreathTek UBT Intended Use The BreathTek® UBT for H. pylori Kit (BreathTek UBT Kit) is intended for use in the qualitative detection of urease associated with H. pylori in the human stomach and is indicated as an aid in the initial diagnosis and post-treatment monitoring of H. pylori infection in adult patients and pediatric patients 3 to 17 years old. The test may be used for monitoring treatment if used at least 4 weeks following completion of therapy. For these purposes, the system utilizes an Infrared Spectrophotometer for the measurement of the ratio of 13CO2 to 12CO2 in breath samples, in clinical laboratories or point-of-care settings. The Pediatric Urea Hydrolysis Rate Calculation Application (pUHR-CA), provided as a web-based calculation program, is required to obtain pediatric test results. The BreathTek UBT Kit is for administration by a health care professional, as ordered by a licensed health care practitioner. Warnings and Precautions • For in vitro diagnostic use only. The Pranactin®-Citric solution is taken orally as part of the diagnostic procedure and contains Phenylalanine (one of the protein components of Aspartame), 84 mg per dosage unit, and should be used with caution in diabetic patients. (For reference, 12 ounces of typical diet cola soft drinks contain approximately 80 mg of Phenylalanine.) • A negative result does not rule out the possibility of H. pylori infection. False negative results do occur with this procedure. If clinical signs are suggestive of H. pylori infection, retest with a new sample or an alternate method. • False negative test results may be caused by: — Ingestion of proton pump inhibitors (PPIs) within 2 weeks prior to performing the BreathTek UBT. If a negative result is obtained from a patient ingesting a PPI within 2 weeks prior to the BreathTek UBT, it may be a false-negative result and the test should be repeated 2 weeks after discontinuing the PPI treatment. A positive result for a patient on a PPI could be considered positive and be acted upon. — Ingestion of antimicrobials, or bismuth preparations within 2 weeks prior to performing the BreathTek UBT — Premature POST-DOSE breath collection time for a patient with a marginally positive BreathTek UBT result — Post-treatment assessment with the BreathTek UBT less than 4 weeks after completion of treatment for the eradication of H. pylori. • False positive test results may be caused by urease associated with other gastric spiral organisms observed in humans such as Helicobacter heilmannii or achlorhydria. • If particulate matter is visible in the reconstituted Pranactin-Citric solution after thorough mixing, the solution should not be used. • Patients who are hypersensitive to mannitol, citric acid or Aspartame should avoid taking the drug solution as this drug solution contains these ingredients. Use with caution in patients with difficulty swallowing or who may be at high risk of aspiration due to medical or physical conditions. • No information is available on use of the Pranactin-Citric solution during pregnancy. • For pediatric test results, the Urea Hydrolysis Rate (UHR) results must be calculated. The Delta over Baseline (DOB) results are only used to calculate the UHR metrics to determine H. pylori infection in pediatric patients. DOB results cannot be used to determine the infection status of pediatric patients. Use the web-based pUHR-CA (https://BreathTekKids.com) to calculate the UHR. • Safety and effectiveness has not been established in children below the age of 3 years. Adverse Events During post-approval use of the BreathTek UBT in adults, the following adverse events have been identified: anaphylactic reaction, hypersensitivity, rash, burning sensation in the stomach, tingling in the skin, vomiting and diarrhea. Because these reactions are reported voluntarily from a population of uncertain size, it is not always possible to establish a causal relationship to drug exposure. In two clinical studies conducted in 176 (analyzed) pediatric patients ages 3 to 17 years to determine the initial diagnosis and post treatment monitoring of H. pylori, the following adverse events experienced by ≥1% of these patients were: vomiting (5.1%), oropharyngeal pain (4.5% to include throat irritation, sore throat, throat burning), nausea (2.3%), restlessness (2.3%), stomach ache/belly pain (1.1%), and diarrhea (1.1%). Most of the adverse events were experienced by patients within minutes to hours of ingestion of the Pranactin-Citric solution. In another clinical study comparing the UBiT®-IR300 and POCone® in pediatric patients ages 3 to 17 years, the following adverse events were observed among the 99 subjects enrolled: 2 incidences of headache, and 1 incidence each of cough, dry mouth and acute upper respiratory infection. May 2014

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References: 1. Vakil N, Megraud F. Eradication therapy for Helicobacter pylori. Gastroenterology. 2007;133(3):985-1001. 2. Vakil N, Fendrick AM. How to test for Helicobacter pylori in 2005. Cleve Clin J Med. 2005;72(suppl 2):S8-S13. 3. Chu Y-T, Wang Y-H, Wu J-J, Lei H-Y. Invasion and multiplication of Helicobacter pylori in gastric epithelial cells and implications for antibiotic resistance. Infect Immun. 2010;78(10):4157-4165. 4. Chey WD, Wong BCY; Practice Parameters Committee of the American College of Gastroenterology. American College of Gastroenterology guideline on the management of Helicobacter pylori infection. Am J Gastroenterol. 2007;102(8):1808-1825. 5. Package Insert for BreathTek UBT. Otsuka America Pharmaceutical, Inc; 2014.

©2015 Otsuka America Pharmaceutical, Inc.

April 2015

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PA M L PAML grew to encompass a wider geographical presence, additionally realigning its focus to diagnostics. “About three years ago, we launched a professional services corporation,” said Dr. Velázquez. “We developed a portfolio of complementary skills that are useful not only to us as a company but more importantly bring valuable services to those that we work with.” Referring to PAML as a healthcare solutions company, Dr. Velázquez went on to explain that his primary goal was to do the best work possible, leaving his clients and partners with the solutions and a roadmap to providing better care. “Our goal is to go in and help you and leave as quickly as we can,” said Dr. Velázquez. Successful Direction How does a company remain competitive, especially within the

H E A LT H C A R E

healthcare industry? According to Dr. Velázquez, the answer is simple: pay attention. “We pay attention to new developments,” clarified Dr. Velázquez. “And not just in the healthcare industry, but in others as well.” “It’s important for us to understand what the world around us is doing because ultimately most of the trends that we see in other industries will come to healthcare,” he continued. PAML also connects with higher level academic institutions to understand where innovation is headed. By spending time with entrepreneurs and those investing venture capital dollars in new technologies, PAML successfully keeps its “finger on the pulse.” Innovative Solutions PAML is striving to close the gap in

“It’s important for us to understand what the world around us is doing because ultimately most of the trends that we see in other industries will come to healthcare” – Dr. Francisco R. Velázquez, President and Chief Executive Officer w w w. p a m l . c o m

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Sarstedt - solutions for the clinical lab Sarstedt offers modular technology for efficient sample preparation. With options for bulk loading, identification, decapping, sorting, aliquoting, and recapping - we provide the automation you need now plus the ability to add more later. And because we are also a global manufacturer of premium consumables, we can provide the total solution for all of your requirements. Sarstedt is a proud business partner of Pathology Associates Medical Laboratories.

800-257-5101 . customerservice@sarstedt.us . www.sarstedt.com


PA M L the continuum of care between the time that individuals are consumers and the time that they are patients. “Right now, both worlds don’t connect and we’re looking to connect those better,” said Dr. Velázquez. With more consumers looking for ways to proactively manage their health, many have turned to the internet for help in accessing medical resources to help them make smart decisions. In response to this, late last year PAML unveiled its website for Cinch™, the company’s new consumerbased product line that empowers individuals to reveal their health through easy access to laboratory testing and information. “Our Cinch product line is a step above what is currently being offered in the market for directto-consumer laboratory testing,” said Shawn Whitcomb, PAML’s Chief Information Officer in a press release. “We are delivering the same superiority in laboratory testing that patients receive from their physician, but with much more convenience and flexibility, and often at a lower cost than a traditional physician visit.”

H E A LT H C A R E

Additionally, PAML recently launched another brand titled AION (meaning “life” or “longevity” in Greek) which aims to assist physicians practicing personalized medicine by delivering evidencebased testing utilizing robust diagnostic technology to detect risk factors and biomarkers associated with aging. Through clinical relevance and uniformity of testing, AION aids physicians in their efforts to monitor patients and manage treatment programs over time. AION also provides nationwide concierge phlebotomy services to healthcare providers that do not have in-house drawing personnel, as well as an online portal delivering enhanced reports. “We’ve segmented the areas of wellness we serve into traditional and clinical wellness, wellness for consumers, wellness for the ageing population and we’re now entering into corporate wellness for employees,” said Dr. Velázquez. Why Choose PAML? “In short, we’re a true partner,” said Dr. Velázquez. “Our goal is for you to w w w. p a m l . c o m

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QUANTA Lite®

Calprotectin Differentiate between IBS and IBD with a non-invasive marker of intestinal inflammation.

1

Now available, an FDA cleared assay that delivers the results physicians need for patients with symptoms of IBD • A new fecal ELISA test kit offering expanded dynamic range of 15.6-500mg/kg1 • High sensitivity helps guide decision-making when selecting patients for endoscopy2

For more information visit www.inovadx.com Scan this QR code or go to www.inovadx.com/calprotectin to learn more about this important marker

INOVA Diagnostics, Inc., San Diego, CA 92131 858-586-9900 www.inovadx.com References: 1. QUANTA Lite Calprotectin directional insert. 2. Bunn, S. et al. Fecal calprotectin: validation as a noninvasive measure of bowel inflammation in childhood inflammatory bowel disease. J Pediatric Gastroenterology Nutrition 2001;33:14-22.

QUANTA Lite is a trademark of Inova Diagnostics, Inc. © 2015 Inova Diagnostics, Inc. All rights reserved. 690416 August 2014 Rev. 1


H E A LT H C A R E

Company Information INDUSTRY

PAML HEADQUARTERS

Healthcare FOUNDED

1957 EMPLOYEES

1000

succeed. We’re focused on quality and service in terms of providing for those that work with us.” As a value-driven organization, PAML looks to enhance the skills and abilities of its clients all while remaining community-centric. Mindful of its presence in the community, PAML is constantly looking to locally brand joint ventures for the benefit of its partners and the community as a whole. “Our goal is to do upwards of 90 percent of the volume generated in a particular region locally,” explained Dr. Velázquez. “That way we can increase the efficiency of our local partners, provide them with a revenue stream they didn’t previously have, and maintain the continuity of information for the region of delivered care.”

REVENUE

$250 M PRODUCTS/ SERVICES

www.paml.com

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CenterPoint Properties

Going the extra mile For more than 20 years, CenterPoint Properties has built a solid reputation in the warehouse, distribution and shipping industry by delivering on promises and going the extra mile. Written by: Robert Spence Produced by: Tom Venturo


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CENTERPOINT PROPERTIES

Uline Corporate Building

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eadquartered in Oak Brook, Illinois, CenterPoint Properties is a leading industrial real estate company focused on the acquisition, development, redevelopment and management of industrial real estate as well as port and intermodal-related properties. For more than 20 years, CenterPoint Properties has built a solid reputation in the warehouse, distribution and shipping industry by delivering on promises and adding value to its customers through innovative solutions designed to improve supply chain and operating efficiencies.

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Their latest project reveals the inner workings to their success. New developments on the horizon CenterPoint is currently constructing a new development for two neighboring industrial facilities in Pleasant Prairie, Wisconsin. The first is a 521,000-square-feet build-to-suit for ULINE Shipping Supply Specialists, a distributor of shipping, industrial and packaging materials to businesses, which is being constructed adjacent to a 410,000-square-feet speculative building in LakeView Corporate Park.


CONSTRUCTION

ULINE DC at LakeView Corporate Park, WI 11400 88th Ave

“We are grateful that ULINE has selected CenterPoint as the developer for this project and has confidence in our ability to execute this built-to-suit facility,” said Michael Murphy, chief development officer at CenterPoint Properties. “We’ve been lucky enough to work with ULINE in the past and our relationship with them is based on quality and consistency of service.” The new state-of-the-art facility by ULINE is positioned on nearly 30 acres and is located in close proximity to ULINE corporate headquarters and other existing warehouse facilities. “Jobs and construction will be a significant impact on the local community. The new building will help drive some synergies in the area, reducing supply chain cost and enhancing operating efficiencies,” said Murphy.

“We’re a little outside the box – in both the way we view projects and the creative way we finance some of our projects” – Michael P. Murphy, Chief Development Officer

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CENTERPOINT PROPERTIES The new building, which will include 88 docks cross-loaded with two drive-in doors, will also embrace 100 percent LED lighting “This is the first time we’ve constructed a full brand new LED lighting project. The new lighting will help the building sing; providing a bright work environment which is good for productivity and employees,” said Murphy. “Although LED lighting is initially more expensive, they’ll ultimately save on energy costs. It’s an investment in

Proud to be chosen as the contractor for CenterPoint Properties and ULINE.

CHICAGO | DALL AS w w w.fclbuilders.com

the future.” Simultaneously being built is a neighboring 410,000-square-foot speculative building, which will serve the needs of a tenant looking to immediately occupy a Class A cross-loaded distribution facility located in an established business park environment. “Being able to build both buildings in the same time has allowed us to do the grading and buying of materials in one package. This allowed us some deals on pricing,


CONSTRUCTION

including labor and construction overhead,” said Murphy. “By being comfortable with the market, we were able to take some risks with this project. In return, we’ve been able to almost double the size of the project, while reducing costs.” He added, “We’re a little outside the box – in both the way we view projects and the creative way we finance some of our projects. We do some things our competitors wouldn’t, but that gives us a unique niche in this marketplace.”

on-time delivery and going the extra mile. This motto has paid dividends in multiple transactions. When you do a great job, clients call you back. We pride ourselves on delivering the project just the way the client wants it.” Like any great company, the secret to CenterPoint’s success is its employees, serving as the core component to delivering the company’s promise of quality service. The company has adopted a teamwork mentality to ensure projects and client satisfaction is always attained. Both facilities are expected to “We’re not a huge company, in be completed in July 2015. terms of personnel, but we’re all focused on the business. For us, Fulfilling promises this is a team sport and we all work According to Murphy, the company’s together to achieve our goals,” foundation is built on fulfilling their said Murphy. “That mentality has promises and going the extra mile been positive for us. Our business for clients. “In this business, people is very relationship oriented and if make a lot of promises when you’re someone has a key relationship, we chasing the deal,” he said. “For us, share information and work together. we’re very good at listening to the What’s good for one portion of the client to find the best solution to get company is good for it all.” the product they want.” Relationships also play a critical For CenterPoint Properties, part in CenterPoint’s rapport with repeat business demonstrates the contractors and subcontractors. company’s philosophy is working. “We have very good long“We focus on customer service, term general contractors and w w w. c e n t e r p o i n t . c o m

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CENTERPOINT PROPERTIES

Michael P. Murphy, Chief Development Officer

subcontractors. In our business, it’s not a one size fits all. It depends where in the country we are and what their pricing is. We’ve had a 82

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great relationship with FCL for the last 25 years. They are someone we can rely on.” Another unwavering promise for


CONSTRUCTION

CenterPoint Properties is safety. The company is committed to providing top notch working conditions with safety protocols in place for company employees as well contractors on-site. “Every project we do starts with safety and ends with safety,” said Murphy. “Safety is a major consideration in what we do and that goes for us as well as our contractors. They appreciate it.” The extra mile From concept to construction, CenterPoint Properties continuously strives to ensure that quality is met in each and every project the company undertakes. “Quality is extremely important to us,” said Murphy. “We have a third-party firm verify all site conditions to ensure we’ve met our client’s standards, as well as our own. It’s not something we take lightly.” Along with going the extra mile for its clients, CenterPoint continues to go the extra mile in the communities in which it operates. The company has launched various programs in the community such as partnerships with the local college for training as well as local outreach programs for labor. While many companies claim to do so, CenterPoint Properties truly exemplifies what it means to go the extra mile.

Company Information INDUSTRY

Construction HEADQUARTERS

1808 Swift Drive Oak Brook, Illinois, United States FOUNDED

1993 EMPLOYEES

99 REVENUE

Not Disclosed PRODUCTS/ SERVICES

Construction; Real-estate

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America’s Combat Logistics Support Agency 85


A M E R I C A’ S C O M B AT L O G I S T I C S S U P P O R T A G E N C Y

Airmen unload expeditionary medical support equipment from a C-17 Globemaster III aircraft in Monrovia, Liberia in support of Operation United Assistance. The maps provided by DLA accurately reflect daily changes on the ground, allowing aid workers to navigate and aid relief more effectively. — U.S. Army Photo

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ast fall while many Americans were learning the signs and symptoms of Ebola and calculating their risk of exposure, members of the Defense Logistics Agency were on the ground in Liberia setting the stage for the United States’ contribution to international relief efforts fighting the deadly virus. As part of Operation United Assistance, the Defense Department’s operation supporting the U.S. Agency for International Development-led effort, DLA personnel provided muchneeded supplies including meals, bottled water, medical protective 86

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equipment, generators, lumber, fuel tanks and rough terrain cargo handlers. This is just one example of the agency’s ability to quickly provide worldwide logistics support when called upon. For more than 50 years, DLA has played a pivotal role in our nation’s defense. In 1961, then-Secretary of Defense Robert McNamara authorized the creation of the Defense Supply Agency to assume a major logistics role previously performed by the military services. The intent was to make logistics support more efficient through consolidated management and


Soldiers with 14th Cavalry Regiment, 3rd Brigade, 2nd Infantry Division, break for lunch in Zhari district, Kandahar province, Afghanistan in 2014. Defense Logistics Agency Support TeamAfghanistan work directly with military leaders to ensure troops on the ground get the food, supplies and equipment they needed. — Photo by Army Spc. Jason Nolte

leveraged buying power, thus eliminating wasteful duplication. In 1977, increased revenue and responsibilities triggered the renaming of DSA to the Defense Logistics Agency, and in 1986 DLA was identified as a combat support agency, which gives the agency a relationship with both the chairman of the Joint Chiefs of Staff and the staffs of the combatant commanders around the world. Today, DLA continues to be America’s combat logistics support agency focusing on warfighter support and stewardship excellence. The agency sources and provides more than 88 percent of the

military’s spare parts and nearly 100 percent of the consumable items America’s military forces need to operate, from food, fuel and energy, to uniforms, medical supplies, and construction and barrier equipment. The agency offers the Army, Marine Corps, Navy, Air Force, allied forces and other federal agencies the full spectrum of logistics, acquisition and technical services. DLA supports more than 2,430 weapon systems; manages nine supply chains; processes almost 100,000 requisitions and awards more than 10,000 contract lines per day. In fiscal 2014, agency sales and revenue was $38 billion.

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C O M PA N Y N A M E

Headquartered at Fort Belvoir, Virginia, DLA is a global enterprise that uses primary-level field activities located around the country to provide seamless logistics support to the warfighter. DLA employs more than 25,000 people, which includes civilians, active duty military members and reservists who operate in 48 states and 28 countries. 88

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DLA Land and Maritime in Columbus, Ohio, provides support to the land and maritime weapons systems supply chain. In addition, in order to detect and prevent counterfeit microcircuits from entering into its supply chain, DLA’s Electronics Product Test Center performs an in-house microcircuit anti-counterfeit initiative dubbed DNA marking. The capability


SECTOR

validates the authenticity of purchased microcircuits while increasing their reliability throughout the supply chain. DLA Aviation in Richmond, Virginia, supports more than 1,900 weapon systems, with focused support to 143 major weapon systems and is the U.S. military’s integrated material manager for more than 1.1 million national stock

number items, industrial retail supply and depot-level repairable acquisitions. In 2014, DLA Aviation generated $3.8 billion in sales; processed 2.4 million customer orders and conducted business with more than 5,395 suppliers. DLA Troop Support in Philadelphia, Pennsylvania, supports subsistence, clothing and textiles, construction and

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A M E R I C A’ S C O M B AT L O G I S T I C S S U P P O R T A G E N C Y equipment, medical, and industrial hardware supply chains. Last Christmas, personnel provided more than 31,000 pounds of beef, 21,000 pounds of ham, 29,000 pounds of turkey, 840 gallons of eggnog and 6,000 pies to feed deployed troops in Afghanistan. DLA Energy at Fort Belvoir, Virginia, supports energy solutions including petroleum products and lubes, alternative fuel and renewable energy, aerospace energy, fuel quality and technical support, government fuel card programs, utility services, and installation energy. In fiscal 2014, DLA sold approximately 90 million barrels of fuel to DoD. DLA is a leader in DoD’s efforts to supply the military services with alternative fuel and renewable energy solutions. DLA Distribution in New Cumberland, Pennsylvania, consists of a worldwide network of 24 distribution centers and nine map support offices. Co-locating with the armed forces puts supplies where they are most needed; positioning material closer to the customer improves military readiness,

decreases wait time and cost. DLA Disposition Services in Battle Creek, Michigan, administers the storage and disposal of strategic and critical materials to support national defense and is responsible for reutilization, transfer, demilitarization, and environmental disposal and reuse of excess property. In fiscal 2014, DLA received more than $38 billion in surplus property that was reutilized, transferred, donated and disposed. In Afghanistan, personnel demilitarize many kinds of military equipment that have been declared excess by the military services by shredding, cutting, crushing or torching. To date, this has totaled more than 1 billion pounds of scrap since the organization’s first full site stood up in 2005. No organization in the world juggles small- and large-scale logistics like DLA, and federal agencies are beginning to take notice. “A lot of organizations are starting to realize that what we do is not unique to the military. While the military is our primary customer

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today and tomorrow, there are things we already provide that other federal agencies can easily take advantage of,” said David Kless, who oversees DLA’s support to federal agencies for DLA Logistics Operations. Kless’ team and experts from 92

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all of DLA’s supply chains are working with federal agencies to demonstrate how they, too, can take advantage of the same tailored logistics support enjoyed by military customers worldwide. In most cases, federal agencies that do business with DLA are able to tap


into mature, time-tested pipelines and get better prices for the same material and services they would have purchased elsewhere. The agency already has a mix of formal and informal agreements with several federal agencies. It’s had a formal arrangement with the Federal Emergency Management Agency since Hurricane Katrina hit the Gulf Coast in 2005. While the current agreement calls for DLA to provide FEMA 1 million meals, ready-to-eat and 200,000 gallons of fuel per day during disaster response operations, agency employees saw the need for more following Hurricane Sandy and doubled, or even tripled, the amount of daily support to responders. DLA also supplies fresh fruits

and vegetables for a Department of Agriculture program that gives lowcost or free lunches to qualifying schoolchildren. And when the Department of State assumed U.S. operations in Iraq in December 2011, DLA used existing contracts to provide food and fuel. From DSA to DLA; from a postwar concept to a worldwide logistics leader; from manual, paper-based systems to electronic systems that deliver instant results; DLA has come a long way in more than 50 years as America’s premier combat logistics provider. DLA’s mission is as clear today as the day it was established: provide superb logistics support to America’s warfighters around the world.

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Petro Star

An Alaskan Refiner for Alaskans Since 1984, Petro Star has been faithfully serving its very niche market in Alaska. Written by: Ian Hanner Produced by: James Hayes


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P E T R O S TA R

North Pole Refinery Truck Loading Facility

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f you don’t live in Alaska, you may not know the name Petro Star; but if you do live there, there’s a significant chance that you have them to thank for heating your home in the winter. Petro Star was founded in 1984 in a state more than twice the size of Texas. Servicing an extremely diverse area – in terms of geography andenvironment , the company has been geared toward filling a very specific role in the Alaskan market from the very beginning. “While other [Alaskan] refineries were processing a wide variety of petroleum products, Petro Star’s 96

June 2015

founders recognized the need for a refinery that would process middle distillates such as heating oil, diesel and aviation fuels for homes and businesses in Alaska,” the company’s website states. While their business has evolved greatly since then, that mission still remains the core of their operations, according to Mark John, Vice President of Business Development and Marketing. He said Petro Star got its start when two enterprising employees who worked at a refinery in North Pole, Alaska , saw a need for a home-grown refining company that specialized in the


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Bulk storage at the Petro Star Refinery in North Pole Alaska.

needs of Alaskans and lacked the bureaucracy that came with some large, Lower 48 corporations. “So these two gentlemen went off and raised some money to put up a plant, basically, right next door to the refinery where they used to work,” John said. “It was really to fill a need in that market, which at the time, was predominantly heating oil for the Interior of Alaska and diesel fuel destined for the North Slope. Soon thereafter, jet fuel sales to the military took on a far greater significance.” Ultimately, one of Petro Star’s original investors, Arctic Slope Regional Corporation (an

Alaska Native Corporation), became the sole owner, giving Petro Star the financial strength and leadership necessary to expand its operations. To understand the growth Petro Star has experienced over the years, you have to understand the needs of Alaska— the United States’ most remote state. While other refineries tend to process a wide range of products from their supply of crude oil, Petro Star sticks to middle of the barrel—that’s products in the diesel and jet fuel range. Today a large part of the company’s business comes from sales of aviation fuels to both the w w w. p e t r o s t a r. c o m

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Experienced • On-Time • Freight Service • Since 1980

The solution to your oil and gas needs Lynden has a long history of supporting the oil and gas industry with our ability to carry your materials to the most remote locations around the world. Our fleet of Hercules aircraft and trucks are at the ready and routinely handle large, heavy, and hazardous loads. With a reputation of dependable service, innovation and quick responses year round, Lynden is the solution to your oil and gas project needs.

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P E T R O S TA R private sector and the military in the region. Petro Star is the largest supplier of fuel to the U.S. military in the State of Alaska, producing JP8— an aviation fuel— to Eielson Air Force Base in North Pole and Joint Base Elmendorf-Richardson in Anchorage. They also produce JP-4—a low freeze point helicopter fuel of which Petro Star is the only refiner in the U. S. that produces this product—and JP-5, a low volatility jet fuel which the Coast Guard and Navy use predominantly onboard ships. While primarily a refining company, Petro Star also operates a number of retail and marketing operations that serve markets across the State of Alaska. So while it’s clear that Petro Star serves a very niche market in the region, it might seem at face value that they have little room to expand in Alaska without a dramatic increase in demand. That is far from the case, according to John. “Room to grow for us means expanding our current production of similar products and actually looking at some new products,” he

E X P L O R AT I O N W O R L D

said. “Those products would be made from utilizing different parts of the barrel besides the diesel part, whether that’s the heavier part of the barrel or possibly the lighter end of the barrel. Alaska is driven by the price of crude so the economy here is dependent on that price, but we are definitely more in a growth mode now than we have been for a while.” What’s driving some of that growth is the recent changes in market due to a shuttered refinery. When Flint Hills Resources ceased refining operations in 2014 and converted the site into a terminal, they took offline one of the larger refineries in the state. That 37-yearold facility was much larger than the Petro Star refineries, meaning that Flint Hills left behind an underserved market. “We’re trying to make sure that we can serve our existing customers and expand to meet any potential new demand in Alaska” John said. “So that’s been our focus for the last year.” That’s a tall order, but John said that Petro Star’s two refineries— two of three remaining in the state— are up to the challenge. w w w. p e t r o s t a r. c o m

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P E T R O S TA R

Kirby Marine www.kirbycorp.com

PROUD TO PARTNER WITH PETRO STAR IN SERVING OUR TROOPS WITH MILITARY LOCATIONS AROUND THE WORLD, ORION PROVIDES BOTH CONUS & OCONUS LOGISTICAL SUPPORT AS WELL AS COMPREHENSIVE SUPPORT INCLUDING:

OCONUS DISTRIBUTION VIA SDDC FOR OVER 15 YEARS

APPROVED SUPPLIER IN THE APHC (FORMERLY VETCOM)

ONGOING SUBSISTENCE DELIVERIES FOR NEARLY 15 YEARS

Experienced and flexible, with a history of quality and proven success! Let our expert team provide a foodservice solution for your organization today.

CALL TODAY: 877-841-1431 OR VISIT ORIONFOODS.COM

COPYRIGHT © 2015. ORION FOOD SYSTEMS, LLC. ALL RIGHTS RESERVED

P.O. Box 1745 Houston, TX 7 7 2 51 - 17 4 5

Putting AMericA’s WAterWAys to WorK contact us 713-435-1000


E X P L O R AT I O N W O R L D

For some fundamentals, Petro Star operates two refineries in Alaska: the North Pole and Valdez refineries, which respectively, can process 22,000 and 60,000 barrels per day of Alaska North Slope crude oil, drawn directly off the Trans-Alaska Pipeline System (TAPS). Of that oil, about 2530 percent is used for the company’s range of products and refinery fuel, with the remaining volume being sent back into TAPS. While the company has been successful in Alaska, there are no current plans to expand outside the state’s borders and John said the company will remain focused on the state’s market for the foreseeable future. “Alaska is such a big place that just doing business here is like someone in the Lower 48 covering a large part of the U.S.,” he said. “We have an operation out in Dutch Harbor and Dutch Harbor is 1260 miles from Petro Star’s Valdez refinery. Our parent company is based in Barrow and if you look at a map, that’s at the very, very top of Alaska, and they actually barge fuel clear up there. So right now the current plan is to stay Alaskan-based.”

Company Information INDUSTRY

Oil Refining, Marketing HEADQUARTERS

3900 C Street Suite 802 Anchorage, Alaska, United States FOUNDED

1984 EMPLOYEES

Not Disclosed REVENUE

Not Disclosed

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American Apparel Inc. Superior Supplier in Combat and Utility Uniforms

American Apparel Inc. was recently named Gold Star Superior Supplier by the Defense Logistics Agency Written by: Robert Spence Produced by: Jason Wright


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American Apparel employee applying genuine care to their work

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or the last 25 years, American Apparel Inc. has been an industry leader in manufacturing combat and utility uniforms for the Department of Defense. Headquartered in Selma, Alabama, the manufacturing company prides itself on providing stellar performance in quality and delivery, while being highly automated and efficient. And it’s paying off. Gold Superior Supplier Award 104

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The Defense Logistics Agency (DLA) recently named American Apparel Inc. as a top performing supply contractor, awarding the company with its coveted Gold Star Award. DLA considered 153 of its parts and commodity suppliers with the largest contracts that have done business with the agency over the past two years. “We are honored to be selected for this award and it is a tribute to the attitude and effort of all our employees. American has been a


M A N U FA C T U R I N G G L O B A L

American Apparel Inc. was recently named Gold Star Superior Supplier by the Defense Logistics Agency

major supplier of military uniforms for over 25 years and our employees take a tremendous pride in the support of the Warfighter,” said Chuck Lambert, Chief Operating Officer for American Apparel. “To be honest, we’ve never focused on the award, but to even be in the same discussions associated with the other Gold Star companies on the list is most humbling.” The award designation is part of the DLA’s Superior Supplier Incentive Program (SSIP), which is designed to incentivize contractor performance by identifying suppliers with the highest rankings in areas such as cost, schedule, performance, quality, and business relations. According to Lambert, winning the award has created an attitude within our organization that it

“Our QMS is maintained and continually improved through the use of quality objectives, internal audits, data analysis, corrective action and management review.” – Chuck Lambert, Chief Operating Officer for American Apparel

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A M E R I C A N A P PA R E L I N C . can be recognized when it puts forth the additional effort it takes to be at the top of your game. “We are by no means perfect, and learn from our weaknesses each day. It just helps all of our employees to understand by working together and communicating to each other so we can continue to grow and be successful.” Operations American Apparel employs just under 500 employees in three

facilities in Alabama. Historically, the facilities have been located in small communities where apparel cut and sew operation had previously operated during the 1980s and 90s. The company is currently positioning itself to be available for potential upswings in product lines and begin an effort to work with all other prime contract holders to create partnerships and to further stabilize production facilities. “Through these efforts, we were able to capture a new contract on

AMERICAN MADE AMERICAN-OWNED

www.carlislefinishing.com

Long-term customer relationships are as important as the fabrics we make.

Carlisle Finishing™

manufactures battle dress uniform fabrics for US prime government contractors and supplies material for US Army ACU, US Marine Corp MCCUU, US Air Force ABU and US Navy NWU. In addition, Carlisle Finishing has been engaged in supply contracts in South America and countries in the Middle East. Other Divisions : • Raeford • Uniform & Career Apparel • Contract Fabrics • Barrier • Menswear • Activewear • Safety Components Carlisle Finishing LLC

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Carlisle, South Carolina 29031

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864-466-4179

Springfield LLC doesn’t just manufacture top-quality fabrics; we make these fabrics more comfortable, sustainable, and dependable. Our innovative textile solutions ensure the ultimate protection for those who protect us.

Springfield LLC 448 Lakeshore Parkway | Rock Hill | SC 29730 PH : 803-909-5555 | Fx: 803-909-5580 | www.springfieldllc.com


M A N U FA C T U R I N G G L O B A L

Marine Corps trousers that allowed us to reopen our trouser facility in Opp, Alabama, which had previously been closed in 2013,” said Lambert. “We have 70 employees back in the facility with plans to add an additional 50-75 in the weeks to come.” Along with a steady workforce, another thing that sets the company apart from competitors is Technology. The company has a proprietary application called American Apparel Information Management System (AAIMS). “The AAIMS system tracks our manufacturing process starting with the order entry and cut planning. This information then drives all the raw material purchasing, labor planning, and cut generation,” said Lambert. “All along the way, the system ensures that we have the contract cost accounting information that is needed by us and our customers.” In addition, American Apparel integrates various systems to ensure standards are consistently met. According to Lambert, the company’s success is based on the belief and understanding of a strong Quality Management System (QMS). “Our QMS is maintained and continually improved through the use of quality objectives, internal audits, data analysis, corrective action and management review,” said Lambert.

American Apparel works with prime contract holders to create partnerships and to further stabilize production facilities

Future plans American Apparel is currently working with the DLA Troop Support to help with the production

– Chuck Lambert, Chief Operating Officer for American Apparel

“We are honored to be selected for this award and it is a tribute to the attitude and effort of all our employees. American has been a major supplier of military uniforms for over 25 years and our employees take a tremendous pride in the support of the Warfighter”

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of new Army Combat Uniforms (ACU), which is implementing a new camouflage pattern for all combat uniforms worn by the Army personnel. The company is also working to reduce the labor content of the products it produces, and automation has been a strong focal point. “One of the major considerations in evaluating automation is the quantity to be produced and over what time period. Obviously, the larger the requirement the more feasible it is for the purchase and payback. Our plans for the future regarding expansion or capital expenditures will solely be determined by the requirement of the Department of Defense,” said Lambert. Over the last two years the industry has gone through some extremely tough challenges, according to Lambert, and the overall reduction in requirements of uniforms has had a major impact. “While we understand and support small business, there is a concern as to whether the shrinking industrial base and the financial stability of some small businesses will drastically impact the ability of DLA Troop Support to meet the requirements if the U.S. military is needed in a time of war.” “We have a great working relationship with the people at DLA Troop Support in Philadelphia that is the contracting office for most of our production and feel very comfortable with our position for the future,” adds Lambert.

Company Information INDUSTRY

Manufacturing HEADQUARTERS

P.O. Box 1310 Selma, Alabama, United States, 36702 FOUNDED

1987 EMPLOYEES

500

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PAPCO

Solutions for Success Leading the way in petroleum marketing and distribution, PAPCO offers the products and expertise needed to navigate today’s ever-changing energy markets. Written by: Stephanie C. Ocano

Produced by: Jason Wright


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Strong strategic partnerships with companies such The Vane Brothers Company extends PAPCO capabilities into waterborne and other non-pipeline served markets

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ounded in 1976 as a family oil business, PAPCO has evolved with the times, continuously setting the standard of excellence in the energy supply market. Providing fuel supply, storage, dispensing and inventory management solutions for businesses and government agencies, PAPCO’s largest differentiating factor from its competition is providing innovative solutions through personalized customer care. “One of the things that we offer 112

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our customers is a very customized approach to becoming their fuel supplier,” said Frank Daniels, Director of Marketing at PAPCO, during a recent interview. PAPCO makes the conscious effort to understand its customers’ needs prior to shipping any products. Beyond a tactical fuel supply perspective, PAPCO works alongside its customers in an effort to help them meet their financial goals in running their business. “We strive to be an aligned strategic partner with each and


SECTOR

every one of our customers where we can provide them with efficiency, cost-benefits and help them grow as we grow right alongside them,” said Eric Rosenfeldt, VP Sales, Supply and Trading. “We help such an under-served market in that regard because fuel procurement is mainly driven by price. It is a commodity. Taking that extra step and time to listen to the customer, to understand what their needs are and then come back with real solutions that help their fuel purchasing or their strategy around

how they obtain the fuel that operates their business is something that we try to focus on,” Rosenfeldt added. A Multi-Step Process From the very start, PAPCO creates a personal bond between provider and customer. During the initial appointment, PAPCO creates an open relationship to understand their customers’ business challenges. “We listen to them and try to understand what keeps them awake at night,” said Rosenfeldt. “Is it the fact that they don’t have enough fuel w w w. p a p c o . c o m

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PAPCO provides over-the-water fueling training as part of a program with the United States Coast Guard Training Center in Yorktown, VA


PA P C O supply for their business because the logistical infrastructure around their facilities is very constrained? Or is it the price because they’re in a highly hypercompetitive market?” According to Rosenfeldt, upon identifying the risks and concerns customers have, a plan is created to alleviate said risks and/or constraints and then benchmark said plan. “We then sit down and say ‘How has this worked over time?’” said Rosenfeldt. “We’re not just consultants where we throw something out there and say, ‘You should do this.’ We always circle back to the customer and ask what worked, what didn’t work and how have things changed.” Providing Value for the Customer Thanks to this customized solutions approach, every customer can be sure that they are obtaining product at a market-related price. But that’s not where the true value factors in. The value comes from the why. “It’s not just, ‘Here’s your product, where’s your price?’ and that’s the

S U P P LY C H A I N

end of that,” explained Rosenfeldt. “It’s more about bringing information to the customers and that has a lot to do with the content that we provide our customer base to help them understand where they stand amongst the market and the logistical constraints that have popped up.” By sharing the “why” and “how” with their customers, PAPCO is able to receive valuable feedback that allows them to create new strategies in their operations. In short, PAPCO both watches and analyzes the market, allowing them to manage their own costs and supplies on behalf of their customers. “Answering the ‘What should we do now?’ is a pivotal moment in our relationship with our customers,” said Daniels. “It really defines us in making a strong recommendation based on the customer’s needs.” “We don’t tell the customers we know where the prices are going to be two weeks or two months from now, because no one knows that,” added Rosenfeldt. “What we do is share our knowledge base with them, and offer them substantive w w w. p a p c o . c o m

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PA P C O fuel market information and analysis that helps them make more of an informed decision. That’s what sets us apart.” A Supply Chain Leader PAPCO has access to over 1 million barrels of owned or leased storage. A shipper on the Colonial Pipeline (which links the company’s supply chain all the way to the Gulf Coast) with inventory locations throughout the eastern United States, PAPCO maintains fuel supply agreements with major oil refining companies such as Exxon-Mobil, Citgo, Shell and BP. PAPCO has prided itself on never missing a delivery on account of a lack of supply, and according to Rosenfeldt, this is made possible because of the contingency plans set in place. “It comes through contingency plans and asset diversification,” he said. “What I mean by that is, on a very macro level, the ways in which we transport product are via pipeline, rail, barge or truck, and you need to be able to understand and execute contingencies around all of that.” By having contingency plans in 116

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place, PAPCO can ensure that if something were to happen on the pipeline, the product can still be delivered via barge—if it’s not a waterborne market, then by rail. Asset diversification is having the access to product from a variety of producers so if one has issues, another producer is in place. “When you look at our business of oil distribution and all the other value additions that we bring to the table, one of the things our customers look to us for is experience to get them through tough times,” said Daniels. “Whether its hurricanes or other stressed weather situations where the entire oil infrastructure is severely constrained, that’s when we’re needed most.” Triumph through Tragedy Hurricane Sandy was the deadliest and most destructive hurricane of the 2012 Atlantic hurricane season, as well as the second-costliest hurricane in United States history. When PAPCO was called upon to continue delivering fuel during this calamity, rather than declaring force majeure, the company stepped forward and continued operations


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without missing a beat. “We took a lot of pride in stepping up to the table and performing during that timeframe and not looking at the situation as, ‘How can we have an out because of certain challenges that we may or not be facing because of the market?’” said Daniels. “We looked at it as, ‘This

is our opportunity to prove to our customers the value that we bring to the table.’ And that was the time we needed to perform.” Ben McClenahan, Director of Commercial Sales, added, “That’s part of our value proposition. The supply chain is fragile, but you know, 11 months out of the year there are

PAPCO owns select fleet and storage assets in eastern VA, partnering with third parties to provide the same level of service all along the East Coast

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PA P C O

PAPCO works to become a fuel partner, understanding customers’ needs prior to shipping any product

no problems, but we always tell our customers ahead of time, ‘This will happen at some point.’ Hurricane Sandy is a good example because we have customers today that are very loyal to us, still remembering the tough times they had during those two, three, four months where their supply was very tight and we provided them supply when no one else would.” Creating Relationships with 118

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Suppliers Meeting with their suppliers quarterly, PAPCO continuously reviews its relationships to determine what is being looked at, what new markets look interesting and what assets might be available. “We have quarterly business reviews to make sure our goals are aligned,” reiterated McClenahan. “We don’t want to bring on a new supplier if we can’t help them grow their business along with our


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business, so it’s just a constant communication with them.” PAPCO itself has been recognized as a quality supplier from the U.S. Defense Logistics Agency (DLA). A primary resourcing arm for the U.S. military and other agencies, the DLA recently announced its top performing supply contractors for fiscal years 2013 and 2014 and PAPCO was designated as DLA Superior Supplier. Looking Towards the Future “We have taken our model and executed it,” said McClenahan, “from the consulting base to the selling to the logistical infrastructure—everything that it takes to do our business. Now, we’re going to take that into new markets.” PAPCO’s growth can be attributed to acquisition and organic growth. Acquisition aside, the company feels that there are a number of markets they have not entered that hold substantial potential. But how do you continue to expand in such a competitive market? Focus on your people and your brand. “It is our people at the end of the day that are keeping all our promises and delivering our value to the customers,” said Rosenfeldt. “We’re also seeing the benefits of a really strong brand reputation. It’s rewarding to know that when we approach customers that they’ve heard of us and that our reputation is strong in the marketplace.”

Company Information INDUSTRY

Exploration HEADQUARTERS

4920 Southern Blvd. Virginia Beach, Virginia, United States, 23462 FOUNDED

1976 EMPLOYEES

150 PRODUCTS/ SERVICES

Oil & Energy

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MOMENTIVE PERFORMANCE MATERIALS

Going with the flow Written by: John O’Hanlon Produced by: Richard Durrant


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Momentive Performance Materials Inc. (Momentive) is a global leader in silicones, quartz and ceramics, with a 70 year heritage of being first to market with performance applications for major industries that support and improve everyday life: we took a look at how supply chain excellence underpins its global manufacturing best practices.

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ess than a year after the global silicones, quartz and ceramics specialist Momentive Performance Materials Inc. (Momentive) filed for bankruptcy, saddled by corporate debt it could no longer service, a leaner and fitter company has emerged. A balance sheet restructuring plan eliminated more than $3 billion of debt: now instead of having to find $345 million in interest payments every year, it now faces a $50 million bill, which is well manageable given Momentive’s level of annual turnover, in the region of $2.6 billion. For William Duty, Director of Momentive’s Supply Chain Center of Excellence, the last year has been like a release after a period of confinement. Billy Duty has more than 20 years of supply chain experience under his belt, during which time he has passed through seven mergers or acquisitions, so he is no stranger to corporate change. He has been working in silicones since 1994, not long after the $300 million acquisition of Union Carbide’s silicone business by DLJ Merchant Banking Partners L.P. After going through the GE acquisition of Crompton’s silicone division, he stayed with the business as Director of SIOP (sales, inventory and operations planning) when it was spun off by GE to Leon Black’s Apollo Global Management LLC to form Momentive in 2007. In 2010, there was further adaptation as Momentive was combined with another Apollo-owned company, the specialty chemicals company Hexion, and then last year’s post Chapter 11 decoupling


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Momentive’s global footprint

from Hexion and corporate restructuring. Following the restructuring, Apollo, though it remains at about 40 percent the largest single shareholder, no longer has the majority share in Momentive, and Hexion is again a separate company with its own board and CEO. Momentive has what Duty refers to as an older style footprint; the three biggest of its 23 global manufacturing plants are respectively located in Waterford in upstate New York, Germany and Japan. None of these has any advantages of low cost labor or cheap utilities. Newer plants have been built strategically in China, Thailand and India, but for the time being the lion’s share of production comes out of relatively high cost manufacturing locations. One of the challenges for supply chain

William Duty, Director of Momentive’s Supply Chain Center of Excellence

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MOMENTIVE CHEMICALS

Are you achieving these best-in-class goals at your plant?

Maximizing Prime Production Plants operate at full capacity to increase profitability.

Minimizing Downtime Avoid lost production with assigned dollar values.

Optimizing Product Wheels Improve specific sequences for making products.

Learn how scheduling technology from AspenTech can help at: www.aspentech.com/Exec-Briefing-5-Signs-Optimization. 124

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Reducing Off-Spec Product Minimize output during transitions that is lower grade than normal.


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management is the very large number of different customers the company serves and the wide variety of products it sells into a range of industries. “No single customer provides us with more than three percent of our revenue,” says Duty. “We touch a little bit of everything!” The largest customer industry is consumer goods, where Momentive’s silicone elastomers products provide heat resistance, flame retardancy and moisture/dirt protection, for everything from bakeware and kitchen utensils, to keypads and infant care products. Tire manufacturers use a lot of Momentive’s technology and patented NXT* silanes, which can help manufacturers improve tire rolling resistance and traction while improving wear by enhancing the coupling of silica to tire tread. Currently,

SUPPLIER PROFILE

“No single customer provides us with more than three percent of our revenue” – William Duty

ASPENTECH

AspenTech is a leading supplier of software that optimizes process manufacturing and engineering across oil and gas, chemicals, polymers, pharmaceuticals and other industries that manufacture and produce products from a chemical process. With integrated aspenONE® solutions, companies across the process industries can implement best practices for optimizing supply chain operations. As a result, process manufacturers can achieve supply chain efficiencies, navigate supply chain complexity, and improve the visibility of plans and schedules, all while reducing costs and sustaining commercial excellence. www.aspentech.com/products/aspenONE-Supply-Chain-Management

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M O M E N T I V E P E R F O R M A N C E M AT E R I A L S

Sisterville site

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new production expansion is being planned to double supply capability of these products. The quartz side of the business produces high purity fused quartz and ceramic materials that go into semiconductors, lighting and consumer electronics. Now free from the burden of debt, the company has money to invest, and upgrading the plants and equipment as well as growth will be a priority. The efficiencies this will deliver will go straight to the bottom line and rapidly turn Momentive into a larger more profitable organization, Duty predicts. However, for now he is very much tied up with transforming the supply chain function throughout the company. Before the combination, Hexion had invested heavily in supply chain tools and expertise. He was able to bring these across, including a team of people thoroughly versed in the tools used within the 15-strong Momentive Supply Chain Center of Excellence that he now heads.These are the people who carry out advanced scheduling, planning, and linear programming work, alongside core process experts responsible for supply and demand planning. This team works globally and is hired globally. Its most recent addition was hired in Japan where an advanced scheduling implementation is underway, and someone who could speak the language was needed on the ground. Every region has its own challenges, he says. “One good thing that we started a couple of years

‘Now free from the burden of debt, the company has money to invest, and upgrading the plants and equipment as well as growth will be a priority.’

Growth is now a priority to Momentive Chemicals

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Momentive RTV162 Silicone One Part Epoxy Paste

ago was overhauling our demand planning. Then we went into our inventory analysis, and then we moved on to scheduling and advanced strategies. Because our business is very global and very complex, we are getting a lot of value out of having the right toolset, which is something we did not have in the past.” Strategic planning used to be a headache. The ideal was to keep a rolling five-year program looking at each of the global assets. “Until last year that exercise was done via spreadsheets and it would take months of work just to prepare them, and very little analysis was possible. Last year we used Arkieva’s planning model which

Data to Decisions. Faster.

Congratulations

to our client Momentive and William Duty on their supply chain planning success

Arkeiva

The The giant giant Kibali Kibali mine mine in in the the DRC DRC has has poured its first poured its first gold, gold, marking marking Randgold’s Randgold’s next next big big step step towards towards sustainably sustainably profitable profitable growth. growth.

Taking the next

BIG STEP Arkieva’s software solutions enable global supply chains to profitably plan demand, manage inventories, dPA5734 dPA5734

optimize supply, and schedule production.

www.arkieva.com | info@arkieva.com | 302-738-9215

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LSE LSE :: RRS RRS •• NASDAQ NASDAQ :: GOLD GOLD www.randgoldresources.com www.randgoldresources.com


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enabled us to generate literally hundreds of different scenarios, and at the touch of the button see what the effect of each of those would be on our asset base.” At last, it was possible to drill down into the results, and test the outcomes of different actions in real time. This was no plug and play exercise though, he cautions: “It took us many months to get the model right but now there’s really no limit to what we can do with it.” “Now the supply chain team is taking on another challenge: the plant by plant implementation of the Global Supply Chain Scheduler (GSCS), based on AspenTech’s Aspen Plant Scheduler™ family of products.” “We are over half way through the program now. By using the AspenTech tool and being able to build the logic into the tool from countless interviews with the scheduler, we have been able to generate a lot of value at our plants: minimizing changeovers, reducing inventory because of a better sequence plan, and gaining better visibility.” He hopes to finish at the end of this year or early 2016. Implementation is a painstaking process. The schedulers start by assessing the flow of materials at the plant, the machinery, and the constraints within the entire facility. “We have to do a lot of interviews! When we have all that information, we come away from the site and the technical guys set about preparing the scheduling model. Once we have a decent solution we will go back on site, review the

RTV product range

Momentive RTV103 2.8oz One Part Acetoxy Cure RTV Silicone Adhesive

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“We have been able to generate a lot of value at our plants: minimizing changeovers, reducing inventory because of a better sequence plan, and gaining better visibility” – William Duty, Director of Momentive’s Supply Chain Center of Excellence

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solution with the key people there and refine it some more.” Following some more fine tuning the team returns to the site to do the detailed training, start to use the tool, leaving some team members on site to support, measure, and make sure the process is working as it should. At first, he says, one site was tackled at a time, but now they are doing two at a time. “In the last month we went live in Germany and in Florida and started the process in Brazil and Japan too. We are a lot faster now. At the beginning the


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team was new and they had to learn the process, but we devised the plan in such a way that we could learn as we went.” There is a good reason why twelve plants were done ahead of Japan, he adds: “I wanted to make sure the team had seen all the different types of assets they would encounter in the large Japan facility before they got there - I didn’t want that to be their first time!” New products are constantly coming out of Momentive’s R&D laboratories, and NPD will benefit as much as the facilities from the cash that can now be devoted to this vital function. One major trend in the market is the use of silicones in medical applications. Silicone is used in catheters and tubing, transdermal drug delivery, skin adhesives, and other equipment, and performs better than many other elastomers. According to a recent report, the rapid growth of the end-user markets is one of the factors contributing to the growth of the global silicones market. And the construction and automotive sectors are growing rapidly in emerging economies such as China and India, where silicones are used for various applications such as sealants and adhesives, product areas where Momentive excels. As more applications emerge, supply chain complexity increases, and planning and scheduling functions become more important. The rebirth of Momentive has started well, but future expansion will depend heavily on its success in keeping cost out of the supply chain.

Company Information INDUSTRY

Performance Materials HEADQUARTERS

Waterford, USA FOUNDED

2006 EMPLOYEES

5,000 REVENUE

$2.6 billion PRODUCTS/ SERVICES

Silicones, Quartz, and Ceramics

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Profile for Business Chief USA

BRUSA JUNE 2015  

BRUSA JUNE 2015