Buddy’s Plant Plus Corporation, a family-owned company, and Scotts Miracle-Gro Company have an unusual relationship. Scotts Miracle-Gro is the world’s leading supplier and marketer of consumer products for do-it-yourself lawn and garden care, with products for professional horticulture as well. Buddy’s is Scotts’ sole supplier of water-soluble fertilizers for the continental U.S. market, from which 71 percent of its USD$2.70 billion net sales come. And Scotts is Buddy’s only customer. “It’s like a marriage,” says Ed Studer, president of Buddy’s. “We each do our own part. Scotts does all the marketing and sales, and we do all the manufacturing, packaging, and shipping.”
Based in Ballinger, Texas, Buddy’s employs more than 125 people, which maps it squarely into the small-to-medium sized enterprise (SME) range. Studer and his management team continuously work to improve business and manufacturing processes. The plant uses highly efficient loss-in-weight feeders that measure the loss in weight in materials discharged from the system with a high degree of accuracy. This enables them to meet the stringent 98.9 percent accuracy in batch processing standard to which they work. They also use state-of-the-art enclosed continuous blenders.
Cultivating new business processes
This willingness to invest in its facility and equipment represents the progressive attitude of Buddy’s management, and it was a major contributing factor in the company’s having become Scotts’ sole supplier of the water soluble products. Buddy’s was simply more efficient and productive than the other three manufacturers Scotts previously used.
Early in 2006 Studer and his team began to consider achieving new operational efficiencies. It was particularly important to them to better align and connect front- and back-end operations more efficiently, to ensure insight into all facets of the business, as well as to provide immediate communication with its labs, purchasing, production, and shipping departments. They knew that getting a single view of the whole operation would raise them to a level of greater functional excellence. For instance, it was important to improve their ability to track forecasted demand for product and actual consumption rates, and to move product through the various production stages more efficiently.
In addition, being able to organize data from all segments of the business would make it possible to manage budgets more precisely, and to collaborate better with each other and with external suppliers.
And, as is true in every marriage, they placed a high value on making continuous improvements in communications with their partner. Scotts runs on the SAP R/3 enterprise platform.
At the time the company relied heavily on manual processes. Data was stored in several locations, and much of it was on paper. In addition, many business processes were managed with spreadsheets. “The problem was that too many people were involved, which led to data corruption,“ observes Mike Riley, IT Manager. Buddy’s management needed to get a handle on business operations, but they just couldn’t depend on the accuracy of the data.
The management team looked at a number of vendors’ solutions but didn’t find a good fit. Riley says he turned to the Internet, searching for another alternative. That’s when he found FourthShift Edition Chemicals for SAP Business One from SoftBrands, a certified ISV partner of SAP America, Inc. “Everything seemed to fall into place when we found FourthShift Edition,” he says.
Not only did the solution have the functionality Buddy’s wanted, the team connected well with Thunderbird Consulting in Fredericksburg, Texas, with whom they established a trusting working relationship. “We knew that if we were going to invest in an integrated solution to run our business that we were going to do it for the long term, and we wanted to work with people we could live with,” says Riley. He and Studer involved all the departments, including production, shipping, labs, and accounting in the decision-making process. In April 2006 FourthShift Edition for SAP Business One was the unanimous choice.
Reaping the benefits
The solution went live in August 2006, two weeks ahead of schedule. Studer says that he really appreciates the single view of the whole operation, and the ability to query. “We can ask a question and get an immediate answer about our vendor list, our profit margin, or anything at all.”
They can see the production improvements unfolding daily. Of course they have FIFO (First In/First Out) materials management principles in place, and the system supports their decision making. Studer notes, for instance, “SAP says ‘go get this product and use it to make this batch.’ This is important because if material sits on the warehouse shelf too long it gets hard and it’s harder to work with.”
Studer also remembers all the paperwork they used to generate. They’d store it and could never really use it. “Now with a click of a button we get all the information we need to make decisions.”
“We’ve made tremendous progress,” Riley says, “and we look forward to getting the go-ahead to proceed with our plans to integrate fully with the Scotts operation, which will eliminate manual entry of data into the Scotts system. The systems are capable of doing it. We just haven’t implemented it yet.”
Tending work flow
FourthShift Edition for SAP Business One includes an intelligent barcoding and workflow tool that enables data collection, workflow flexibility and serial-device control. Currently Buddy’s has about twelve handheld “guns” that captures bar code data to track inventory movement and consumption. For instance, in the Acrison feeder area where product is formulated, workers stage the raw material for the MO (manufacturing order), print the labels for the bags so product can be analyzed in the lab, and then it’s ready to be staged to the packaging room. Forklift operators receive it against their own MO and generate labels that go on pallets. Then shipping can use the information in preparing product to go straight to Scotts’ customers.
Keeping yield high
Throughout the whole manufacturing process the solution helps Buddy’s personnel track variances. For example, Studer notes, “If we’re losing boxes because of a machine problem we can log that into SAP so when the crew finishes the run they can evaluate where they’ve done well and where there may be problems.”
“With our new solution in place we are keeping track of every pound of material and can stay within our one percent loss tolerance,” says Studer.” He explains that Buddy’s is saving Scotts a considerable amount of money by reducing waste and overage, since one percent of 2.5 million pounds (1,133.98093 metric tons) is not trivial.
“Our accountability is up and our variances are down,” he says. With FourthShift Edition for SAP Business One I am confident that we can continue to meet our continuous process improvement goals.