The global supply chain at Marel is responsible for procurement and manufacturing within the company and operates worldwide, integrating the company’s fish, meat, poultry and further processing industry units.
A team of over 2,000 people supports product development with new equipment and service parts. Our experts make sure that our modernization projects, large greenfields developments and individual machine installations run on schedule and are delivered and serviced in line with agreements. We work closely with logistics services and key material and parts suppliers around the world.
In 2017, we realized the benefits of previous restructurings and consolidation of the supply chain footprint.
We now run 12 manufacturing sites for machines and parts and 4 main distribution centers for service parts. These changes increase the reliability and consistency of productivity and output.
Quality, responsiveness and efficiency are the cornerstones of our operation. Our approach is based on the simple yet effective premise of ensuring that all parts and equipment are delivered to the right place, at the right time and with the right quality and cost. This applies to all phases of manufacturing and distribution as well as to our procurement and supplier’s processes.
With the benefit of unique scale and skills, Marel’s activities have a major competitive advantage. In 2017, we experienced a noticeable strengthening of our operational performance following the co-location of product manufacturing to the best fitting site. This has improved supply chain performance and provides a sustainable base for growth.
The 2017 acquisition of Sulmaq and the previous integration of MPS into our meat unit create even further opportunities for global synergies in Marel’s supply base. To take advantage of these opportunities, our leadership organization has been strengthened with new hires. This will further support our growth strategy for the future, allowing us to continue to benefit from and expand our global synergies and focus more intently on our key competencies.
The consolidation steps made in previous years continued to deliver benefits in 2017. We saw further improvement resulting from the reduction of suppliers and product standardization, both of which delivered cost reductions and stronger supplier relations.
Marel’s suppliers and their sub-tier suppliers are critical parts of our supply chain. Without them, we would not be able to deliver high quality products reliably to our customers. Just as internal efficiency is essential, so is working effectively with our suppliers.
In order to improve this part of our operation we also implemented a company-wide operating model, making major changes to our KPI reporting. We took steps to reduce the number of suppliers and focus more on partnerships with key suppliers of parts, assemblies and equipment.
This year we also focused on strengthening our internal operations, improving processes and working procedures in general to optimize the way we structure our supply chain. This enables us to meet demands of both market and product development, creating the best possible supply chain for Marel globally.
Today, there are 12 manufacturing sites strategically positioned around the world. The refocusing program launched in 2014, optimized the manufacturing footprint from 19 sites thereby reducing complexity. This laid a cornerstone for the operational excellence and scalability needed to support future growth. In particular, we have marked Brazil, Slovakia and China as our key growth platforms.
Optimizing manufacturing affected our site in Slovakia considerably. The two locations were consolidated into a single facility, improving the efficiency and efficacy of local processes. Currently, our site in Slovakia accounts for about 10% of total production volume and we are ready to increase this to about 20% of our internal capacity.
We focus on standard and mature products at this site, which is now more streamlined. It also offers opportunities for even better utilization in the future.
All products produced at Marel have a designated home, either a mother site or a co-location site. The mother site is responsible for product life cycle management and how the product is manufactured. Co-location sites are focused on scale manufacturing, producing large volumes in a cost effective manner in close proximity to the customer resulting in improved optimal lead-time and cost. As investments in IT systems progress, products will more easily be producible at co-location sites.
A good example of how successful cooperation between multiple disciplines within the company can achieve remarkable end results is the new live-bird handling system for the poultry processing industry launched this year.
With successful co-operation and a flexible production platform, the supply chain was able to contribute significantly to the success of this new product launch. On top of this, improved automation drove the supply chain performance to a high and sustainable level on this project. We view this achievement as a benchmark for future performance.
Our factories are getting smarter as we contribute to the development and implementation of automation in the food processing industry. We now have a global industrial engineering approach leading to standardization in processes and investments at all sites.
We have always been a high-tech company, leading the automation of our industry and we are now exploring the potential of Industry 4.0.
We see an abundance of opportunities that will enable us to improve supply chain expediency even further by utilizing this new reality. It will enable us to deliver more rapidly and flexibly under any conditions.
We continue our own automation efforts: this year, Marel’s seventh manufacturing site purchased a robot welder. This is part of our ongoing strategy to expand robot welding and standardization in robot welding techniques, enhancing quality and making reproduction easier over all sites while minimizing costs.