How BJ Ball are tackling the supply chain disruptions

It’s been an interesting few years. I can’t help but think we are ready to face almost any challenge as a result, but at the same time I’m hoping this isn’t put to the test.

As I’ve previously mentioned, and like many other businesses, we’ve faced a global pandemic and the lockdowns, changing work practices and staff impacts it brought with it. We’ve been hit by price increases, product shortages and shipping delays. Our supply chain has been continuously disrupted by industrial action at ports and mills around the world and the closure of mills, suppliers and customer businesses.

We’ve also seen a rebalancing in the market and a number of mills and printers shifting focus to higher demand products e.g packing. All of which has had a flow-on effect that lasts for months, if not longer, after the event.

Throughout the last few years our efforts have been focused on 3 key programmes of work. The first was dealing with the immediate challenges and making the necessary changes to continue to operate as best we could. Secondly, we focused on minimising the impact to our clients. And last but not least, we have been preparing the business for the carbon free, zero emissions future.

We are far from complete and we are certainly not perfect but I did want to share a few of our initiatives and plans in the hope you might find them interesting, if not useful.

A key area of focus has been the relationships and communication with our clients and suppliers alike. Understanding our clients needs and the challenges they face. Trying to forecast or predict their future needs. Prioritising the relationship with our global suppliers. New Zealand has become increasingly undesirable as a shipping destination so maintaining our existing relationships has been critical to the supply of products.

We have also strengthened our partnerships with the domestic mills, in particular Whakatane, to reduce our reliance on the overseas providers and the troubled shipping industry. Where possible we have exclusive agreements in place to provide certainty of supply and pricing, as much as possible.

We’ve also been expanding our product range to provide more choice to our clients. Having a selection of products to choose from is key when facing shortages, delays and price increases.

To the extent possible we have been increasing our stock levels to offset product shortages and shipping delays. We have also been working with clients on their planning and forecasting, ensuring stock is available when it’s required as well as storing additional stock for them.

As a result there is increased demand for storage space and greater pressure on working capital so we’ve had to make adjustments and optimise all aspects of the business.

There have been a number of manufacturers that have been shutdown by the local government due to their poor emissions standards. We have maintained a rigorous process for the selection of our suppliers that ensures their ESG practices are of the highest standard. As such, none of the aforementioned manufacturers were suppliers to BJ Ball. That said, these closures increase the demand on the reputable and sustainable producers we do work with.

There is a price to pay for product stewardship, sustainable product lifecycle management and waste reduction. For one, these have to be independently certified. But when we consider these recent closures and the high priority placed on sustainable practices by governments and consumers alike, it provides some validation for the choices we’ve made.

We’ve also introduced a recyclable moisture proof paper wrapping material to reduce the amount of plastic coated wrapper entering landfill. This new paper wrapper has enabled our clients to divert more than 700,000 square metres of material from landfill. We also introduced a new 68gsm Coper Paper, with a recycled wrapper. Check out the video below if you’d like to know more –

As mentioned in my outlook post, we are not expecting to see any significant improvements to the global or local supply challenges in the near term (12-24 months). As such we are continuing to work with our clients on their shift to a just-in-case inventory model and the use of inventory management tools like iConsignment.

At the same time we are investing in our own technology to reduce costs and automate a number of administrative and client engagement activities. In some cases we will be looking to partner with clients to enable these technologies and to realise the mutual benefits.

If you like to know more about our plans and initiatives, and any opportunities to participate in specific projects, I’d welcome the opportunity to meet and discuss them in more detail.