in The Forrester Wave™: Digital Operations Platforms For Manufacturing Businesses, Q3 2020.
Ludington, Michigan-based FloraCraft began life some 70 years ago as a small, family-owned organization, serving customers in the floral arrangements sector across the US. The business developed a relationship with Dow Chemical— who had found that the properties of Styrofoam™ made it an ideal product for arranging flowers—and then expanded production later moving into the craft market, making children’s products and educational items amongst others.
Today, the firm employs over 300 people within its Michigan, Arkansas, California and Mexico operations, shipping products across the US as well as many other countries around the world.
Jim Scatena, FloraCraft’s President and CEO explains the philosophy that has helped his business become one of the most successful in its field: “We will pretty much do anything to please our customers, enhance our reputation and improve our reliability and relationships, which ultimately drives our business. We want to be that ‘go-to’ supplier, and that reputation has brought many benefits in terms of new business opportunities over the last few years.”
By capitalizing on this reputation, FloraCraft was able to reinvent itself some seven years ago. They shifted strategies to focus more on mass-market production. This change of focus almost tripled inventory, or product lines, and helped them to secure additional shelf space with large-scale retailers.
Today FloraCraft has a portfolio of 3,500 SKUs in production in any one year. However, with that increased SKU count and prime retail space came additional demands. Scatena continues: “We had fortified our logistics and supplychain capabilities but we were quickly outgrowing our technology needs. The expansion of new products brought increased lead-times for our overseas manufacturing operations.”
With this in mind, FloraCraft’s management team realized that its existing technology couldn’t keep up with the needs of customers. The company’s legacy system consisted of an MXP ERP that delivered printed financial and production reports which were simply sent for filing. They also used WHSe-LINK from Interlink Technologies to manage their warehouse operation, updating data to MXP with a lag time of five minutes. Their inventory wasn’t serialized, leading to inaccuracies that were exacerbated during the transmission of data between the two systems.
All in all, FloraCraft was existing with a very limited view of its real operational capabilities and financial status—but what was the answer? Technology. Scatena explains: “We view IT as core to our business and want to truly leverage its capabilities to improve process, create competitive differentiation and help grow our business.”
So the team embarked on selecting a new ERP that could provide a single view of their business end-to-end from the moment raw materials were delivered to the moment financial reports were produced
“We undertook a thorough review of our options, going to demos of alternative ERPs including Epicor, NetSuite and Microsoft Dynamics,” says Scatena. “Ultimately Plex was a much better match for us. It had all the processes we needed integrated into one solution. And when we saw it running in production environments at Plex customer sites as well as another manufacturing company, Whitehall Industries, across town, we decided it was the perfect fit for us.”
In particular, FloraCraft liked the fact that the Plex Manufacturing Cloud was a true cloud solution. Every user worked with the always-current version of the software so there were no issues with version control or functionality gaps. “We only have two IT folks at FloraCraft so not having to manage additional servers and software is a real bonus for us, as is the minimal overhead required to upgrade versions or manage ERP licensing!”
Knowing what a significant change this deployment would make to their operations, and recognizing the low margin/high volume nature of the business, the FloraCraft management team designed a testing and training plan specifically to mitigate risk, make cutover completely seamless and protect production integrity.
Scatena describes what happened: “We decided to bring the Time & Attendance module online first so that HR, supervisors and employees could get used to the software. Following this, we tested how some of our most complex processes would work, learning each new module with our project manager at Plex. We figured if the application worked seamlessly to deliver products that require up to six steps everything else would be a breeze.”
“This testing phase actually gave us some unexpected benefits,” states Scatena. “It allowed us to tear up our old processes, get rid of old habits and start over. As we built up the layers of complexity by testing Plex across the business, from receipt of goods to shipping and invoicing, we often uncovered opportunities to enhance the way we work.”
As powerful as any software appears to be, it can only deliver value if users work with it. FloraCraft’s IT Director, Wally Cain was concerned about the low level of IT skills amongst the plant floor workforce and whether this would in fact be a roadblock to the Plex installation.
“If any future customers of Plex are concerned about how their workforce will take to the Plex Manufacturing Cloud I would tell them not to worry.”
Within a few months of starting their project, FloraCraft had rolled out Plex across all four of their sites. The system has now been live for more than two years and has transformed both the operational efficiency and commercial success of the company, as follows:
In 2014, FloraCraft won Walmart’s Supplier of the Year accolade—something that the Plex Manufacturing Cloud played a crucial role in achieving.
Walmart looked to its suppliers to execute on some important metrics around sales growth, on-time shipping and fill–rate, gross margin return on investment, retail unit turns, and replenishable in stock—where 99 percent of their stores had to be stocked on any given day.
“The Plex Advanced Planning & Scheduling functionality was particularly useful in helping us better serve Walmart,” Scatena clarifies. “Every week the retailer updates its warehouse order projections in terms of what it needs to buy. We load this information into Plex and get a view of Walmart’s forecast versus what we have on order. This gives us much better visibility of lead times for suppliers like this. Also, being able to dynamically schedule production allows us to ensure we have the right quantities of materials at the right time.” “With Walmart we have a six-day lead-time. They send their orders in on a Tuesday and we ship them back on Friday through to Monday, so it’s vital that we have the right inventory on hand.”
This efficiency has resulted in an increase in FloraCraft SKUs placed with Walmart by an incredible 60 percent.