When Jack Drawdy, the vice president of sales and business at MFG Chemical, walked into his presentation at InformEx last month, the planned topic was about the state of innovation. But after he sat with peers from the industry, the discussion turned to the major issues facing contract manufacturers.
Here are the three stubbon problems and possible solutions Drawdy and the group identified:
Hiring Woes
The jobs are there. The pay is good. The industry is growing.
“But it’s hard to find good people,” Drawdy said.
According to Drawdy, one deterrent is that the jobs can be repetitive and require workers to closely keep up with processes. And while many of these processes are being automated, that option doesn’t always exist for contract manufacturers, who work with multiple chemistries and don’t necessarily make the same products every day.
Making matters worse, Drawdy noted that it’s also difficult to find workers who can pass a drug test.
The Solution: Drawdy suggested collaborating with the local education system to promote jobs in the industry.
“Work with a local college to develop operator programs for technicians,” Drawdy said.
Transportation Hassles
The shortage of qualified truck drivers on the road has been hitting many manufacturing sectors hard. Earlier this year, PwC partnered with the American Chemistry Council to study the problem and found that 70 percent of the chemical companies they surveyed were worried about delays in shipping caused by the trucking industry.
Trucks move about 54 percent of the industry’s goods and chemical shipments are likely to increase as major producers continue to build new plants and expand output.
The Solution: There’s no easy fix to this issue, apart from adding more truckers to the road. In the face of expected delays, PwC and ACC recommended that manufacturers actively prepare their supply chain, and know their risk exposure so they have options to overcome bottlenecks.
Regulatory Uncertainty
President Donald Trump has issued an executive order that calls for two regulations to be nixed from the record every time a new regulation is enacted. But how will this order be implemented? Which agencies will be impacted? As those questions remain unanswered, Drawdy says he’s planning for the current regulatory environment to stay about the same, or for regulations to even increase.
“Best case scenario is that it stabilizes,” he said. “But we are planning for it to continue.”
Customers also want to know more about how your company operates — especially when it comes to safety and sustainability.
The Solution: Drawdy says his company is looking at using different third party audits.
“You have to know what you’re good at and what you’re not good at. We’re good at speed to market and logistics. But we’re not good at audits,” he admitted.
Investing in third party audits gives your company an opportunity to rethink and then possibly improve processes. They will also give your customers more confidence in your operations and safety practices.
