Tom Scaria, Vice President at BassTech International
Over the last year, supply chains across the world have witnessed the impacts of COVID-19 on their operations. Whilst highlighting the fragility of these supply frameworks, this disruption also gave many companies the opportunity to rethink their practices and address an underlying issue which was brought to light as the result of the pandemic.
In this interview, we speak with Tom Scaria, Senior Vice President at leading speciality raw materials supplier, BassTech International, about how his company has adjusted to the changes over the preceding months, and about his predictions for the future.
Could you tell me a little bit more about your role as Senior Vice President at BassTech International?
My current role provides an all encompassing view of BassTech’s business on a global scale. My primary responsibilities are global sales across multiple industry verticals, procurement, HR and I oversee quality and supply chain. I manage the end-to-end value chain all the way from identifying a suitable producer, performing the quality audit, procuring the raw material to overseeing how the supply chain will be for that product along with final delivery to the customer.
As the result of global lockdowns, there have been many disruptions to supply chains around the world. What do you think has been the most prolific impact(s) on the supply of raw materials?
There are many impacts to the supply chain this year, but the largest impact would have to be lack of space for ocean shipping. Shippers went from being able to ship material within a reasonable amount of time, to now material sitting on factory docks or container yards waiting for a vessel. The lack of space has caused ocean freight pricing to skyrocket with still no guarantees to get on the vessel. I have seen shippers like BassTech pay 3-4 times normal rates to try to get material moving, but still not guaranteed space.
However, a trickle down effect occurs which shows all the bottlenecks in the supply chain. For example, containers finally get loaded and shipped only to get stuck at the port waiting for the vessel to berth. Once it is unloaded from the vessel, truckers are waiting for the last free day to collect the container because their schedule is so full with other collections. It is a cycle: lack of shipping space, lack of longshoremen to unload, lack of truckers to collect and move freight. This is just the view on seaports, but even rail cannot keep up with the challenges, as cities like Chicago are backed up as it is a major rail destination. It has changed everyone’s focus to the obstacles in the supply chain.
How have BassTech adapted to meet this shifted supply chain landscape?
BassTech started seeing the issues arising in Q4 2020 as shipping space got tight. For certain products where we were the majority supplier in the US, we took a firm stance to ensure material was available to service customers. We did this by working with our shipping partners to ensure the freight moved at whatever cost to ensure continuity of supply. For more price sensitive products, we worked with our customers and shared price increases with them to ensure material continued flowing and that they did not need to take the entire cost on their own.
We have also made multiple changes to our process including increasing service providers for certain lanes as well as normalizing some of our shipments. This way we can get at least 1-2 containers on a vessel per week instead of trying to get 6 containers, as an example. We always provided transparency on our supply chain to our customers, but we have been providing updates more frequently to keep everyone on the same page.
We have a handful of customers who take advantage of our VMI (Vendor Managed Inventory) option. They have been extremely fortunate this year to avoid costly delays or shortages as we maintain large inventories dedicated to those customers. We also actively work on geographically diversifying supply chain risks. For some customers, I have bi-monthly calls to go through various topics to ensure the customers have full visibility and it helps both sides understand where the product priorities are.
What do you think the future of material supply chains will look like?
There are many thoughts on what the future of material supply chain will look like, be it from automated warehouses to driverless trucks. I believe relationships and diversification are the keys moving forward. When looking through our customer base and issues that occurred in 2020 & H1 2021, the customers that allowed us to work closely with them and be a true partner performed significantly better than customers who did not. These deep relationships help design supply chains that are both resilient and efficient. This involves actively looking at geographically diversifying supply risks, limiting reliance to one country.
I believe relationships and diversification are the keys moving forward… the customers that allowed us to work closely with them and be a true partner performed significantly better than customers who did not.
There will be additional visibility through the supply chain as COVID-19 has shown employers that employees are working more with the ability to react faster to supply changes with advanced connectivity. Supply chain will also have to be an integral part of the corporate strategy if it was not already. Organizations need the flexibility and the ability to react, especially when working on a global scale.
Do you think that changes in current supply chains of raw materials in the US will prove to be a smooth transition? Why/why not?
This would be a case by case basis. Yes, the US can transition back from the service oriented businesses to more manufacturing oriented model, but it unfortunately can’t do it for every product. There will always be economies of scale where there are some countries with richer raw material sources than others or process technology that is better than others.
However, I think it will become more important on leveraging multiple supply sources rather than relying on one source. For example, make a conscience effort to divide your demand into overseas as well as domestic production if there is a suitable producer. It could be something like a 70-30 split but the dial can be adjusted back and forth depending on your requirements as well as global issues. It will take a lot more coordination between supply chain, procurement and sales but it will give companies the ability to react to unforeseen issues like COVID, Suez Canal, etc.
If you were sent to live on a deserted island for a month, what one item would you take with you and why?
I had to think about this as I am assuming I couldn’t take theoretical items like the Iron Man suit. I was thinking of a hammock. Besides being able keep you off the ground when sleeping or lounging, it could be used in a variety of ways: shade, food-catching net, blanket, raincoat, etc.
Tom will be joining us at Ceramics Expo 2021, where he will be sharing his expertise on a panel session about re-imagining the ceramic supply chain. We are delighted to welcome him to the show and look forward to a really engaging panel!
Join us at Ceramics Expo 2021, on August 31st-September 1st in Cleveland, OH where we will be discussing this subject, and many more topics at the forefront of the industry. Experts from leading companies including Kyocera, Morgan Advanced Materials, Northrop Grumman, Skyworks, Lithoz and many more will also be speaking at the event, so make sure not to miss it!