Tara Materials
Case Study: Tara Materials
Agility is more than a buzzword for Jim Pluth, vice president of manufacturing for Tara Materials. In fact, he attributes his company’s very survival in a high-velocity business environment to an ability to make rapid adjustments in logistical and production planning. And, to Mr. Pluth, such agility is a function of data reliability and real-time accessibility across the entire organization.
About The Company
Tara Materials is an Atlanta-based manufacturer of artist materials and accessories - most notably art canvasses and picture frames - for arts & crafts speciality stores, chains and suppliers worldwide. The company owns a manufacturing and distribution facility in Atlanta, a distribution center in San Diego and an assembly facility in Tijuana, Mexico. Tara Materials’ customers demand rapid order fulfillment – sometimes in as little as 5 days. As a result, the company carries significant finished goods and WIP inventory. These customers also exert relentless pressure for cost reductions.
“We have 3,500 finished goods SKUs and need real-time data on inventory levels at each physical location in order to make daily decisions on inventory movement, production planning and scheduling,” says Mr. Pluth. “With our previous ERP solution we didn’t have access to current inventory data or incoming orders, so we couldn’t make those decisions. Our locations weren’t integrated, either. Our factory in Mexico worked off a system that didn’t talk to San Diego, which didn’t interface with the system in Atlanta, so none of our data matched. Our locations were operating almost as separate businesses. We needed a single solution to pull everything together.”
At the time, Tara Materials was also operating without critical ERP functionality, such as production planning and costing. And because its existing system was sold on a module-by-module basis, adding
that functionality and necessary customization would be costly. Consequently, as his team began evaluating replacement ERP solutions, one of Pluth’s key requirements was comprehensive and fully integrated out-ofthe- box functionality, requiring minimal
customization. “I wanted a solution we could keep ‘vanilla’, so we didn’t have to spend a fortune on staff to maintain it.”
The Solution
Tara Materials selected Solarsoft iVP. “With Solarsoft iVP, we got everything and it all worked together,” Pluth says. “We had some customization done at the beginning, but Solarsoft is unique in that they then provide that customization to all their customers and support it, meaning that we didn’t need to do any maintenance on it from that time forward.”
Benefits & Results
Mr. Pluth credits Solarsoft iVP as being the cornerstone of his company’s decision-making processes in areas ranging from inventory and production to shipping management for all three company-owned facilities. “We leverage a lot of technology in order to make our company nimble, but the key principle is that everything is based on the data available to us. We connect each plant and all of our people to Solarsoft iVP via VPN, so the starting point of everything we do is entering data into the solution,” he says. “Our incoming orders show up immediately, and they’re visible to our manufacturing people in Tijuana. Our inventory levels are very accurate, so when product ships out of our two distribution centers everyone can see the real-time inventory changes. Accounting, costing, customer service… everything is done within Solarsoft.”
The decision-making capabilities driven by Solarsoft iVP also provide Tara Materials with a degree of logistical agility inaccessible to it prior to the Solarsoft selection, an agility that has produced labor cost reductions. “It takes lot of manual labor to assemble our product, and with the data available to us through Solarsoft we’re now able to reduce costs by balancing manufacturing and assembly between our companyowned facilities and a stable of contract factories in China,” says Pluth. “We’re able to analyze factors, such as labor costs, transportation costs, inventory levels and shipping schedules in making decisions about outsourcing certain assembly operations to China. For instance, our canvass-coating process is proprietary and highly technical, so it is done in Atlanta. But we’ll then ship the smaller coated canvasses to China for assembly, because we can get so many in a container. We’ll ship the bigger canvasses to Tijuana. In both cases, cheap labor more than offsets the freight component.”
Beyond being innovative logistically, Pluth believes that being lean is the only way to make money in his company’s business environment. He points out that Tara Materials operated with 4 distinct customer service departments with 20 CSRs, 2 accounting departments and 2-man IT staff prior to Solarsoft iVP. “Now we run customer service with 5 CSRs, we’ve downsized to one accounting department and our IT staff is me, when-needed. We’ve reduced our monthly overhead by 40% because of Solarsoft iVP’s impact on managing our business and we’re leaner on inventory, with costs down 25% and accuracy at 99.5%-plus.” Mr. Pluth also indicates that Tara Materials improves its on-time delivery performance from the 30% range to over 90%.
While giving these statistics their due, Mr. Pluth summarizes Solarsoft iVP’s impact in even more stark terms. “I truly believe we might not even be in business if we hadn’t made this investment in Solarsoft; it’s that critical to our operation.”
