Picking a Manufacturing Partner for Your Retail Solutions
Retailers focused on a clear omnichannel strategy enabled through in-store technologies are making the biggest strides in growth, which may explain why 66% of retailers in a Jabil-sponsored survey say they are investing in in-store technologies. When we take a closer look at some of the retail solutions being implemented currently, the list is long and includes inventory accuracy systems, in-store sensors, smart shopping carts, electronic shelf labels, payment solutions and more. Download the full survey report.
In an industry that is becoming increasingly technology-friendly, players are uncertain on where to begin with technology; consequently, retailers are looking for more guidance. As they investigate the best technology fit for their stores and operations, retail solution providers must also focus on their own manufacturing operations, supply chain efficiencies and product innovation.
Solution providers across industries turn to manufacturing partners to outsource their operations, production, design and supply chain to maximize efficiencies. The benefits are numerous and can be game-changing: cost-savings, shorter lead times, increased quality, better hand-off from development to production and quicker time-to-market, just to name a few. So, when you begin searching for a manufacturing partner for your retail solutions, start with these questions:
1. Does the manufacturing partner offer a workcell model?
A workcell model applies a dedicated, cross-functional group of electronics and manufacturing engineers, technologists and supply chain experts to a specific account, ensuring full accountability for all critical operational and financial decisions. The model enables quality, speed and cost to be improved drastically.
For nearly two decades, Jabil has supported Ingenico Group, a retail industry pioneer that provides merchants worldwide with innovative and reliable payment solutions. “Jabil’s workcell model is so important,” Julien Mater, head of operations for Ingenico Group, says. “It just brings the focus to the customer. The team has been intact for a long time; I can’t even think about another model that would work for us.” Read the full Ingenico case study.
The benefits of this close working relationship became increasingly apparent over time for Ingenico, which led to a decision to consolidate all manufacturing operations under one services provider. “The biggest difference in favor of Jabil was tied to three success factors,” Mater adds. “Global account management, flexibility and strong supply chain capabilities.”
Unifying product development, manufacturing, quality and supply chain requirements has proven invaluable in expanding Ingenico’s product portfolio and worldwide presence. “Jabil gives us really strong support,” Bertrand Dajon-Lamare, industrialization director for Ingenico Group, shares. “Jabil’s production experience, along with product design and development skills, enable us to achieve good process automation and increased productivity.”
Ingenico Group and Jabil accelerate delivery of seamless payment solutions
2. Does the manufacturing partner have experience in global supply chain orchestration?
Navigating supply chain headwinds in a turbulent trade climate requires more than a 10-day forecast. Global supply chain orchestration gives you far-reaching insights to better manage unpredictable disruptions, such as supply constraints, commodity price increases and escalating labor costs.
Finding a manufacturing partner with a worldwide perspective was an important requirement for SES-imagotag, a pioneer in Electronic Shelf Labels (ESL). Read the full SES-imagotag case study.
“We work with some of the biggest retailers in the world, so it’s critical to find partners with a global footprint,” Christian Weissensteiner, SVP, operations/manufacturing services for SES-imagotag, says. “This ensures we keep pace with future growth while also meeting customer demands for regional production.”
A major benefit of working with Jabil has been the ability to keep production lines running smoothly, especially when the entire electronics industry has been hampered by severe supply constraints. “A year ago, we faced some major component shortages,” Weissensteiner recalls. “We relied on Jabil to find alternative sources based on good working relationships with other suppliers and distributors. We bridged some very tight situations without impacting production.”
Manufacturing partners can help you navigate turbulent supply chain conditions to ensure rapid access to the best possible components at the lowest possible prices. Further, expedited component delivery is essential for meeting ever-shrinking production timelines. “Standard lead times can change dramatically, and we’ve had lots of success stories where Jabil cut lead times in half,” Weissensteiner notes.
“Jabil is a business partner on every level,” Weissensteiner adds. “We appreciate their proactive approach in supporting our cost commitments, quality improvements and surge of alternative sourcing demands.”
SES-imagotag Partners with Jabil to Propel Global Growth of Smart Electronic Shelf Labels
3. Can the manufacturing partner support a rapid rise in production capacity?
Ask any company that manufactures its own products and they will tell you: increasing production capacity with existing resources is no easy feat. It takes substantial capital and labor investments while putting immense pressure on the whole company. A manufacturing partner can ease the pressure of increasing production capacity for your retail solutions.
After transitioning all manufacturing to Jabil as part of its sole-source manufacturing strategy, Ingenico embarked on a major uptick in production to meet increased market demands. “We decided to double our production capabilities in Brazil, because we are enjoying a very dynamic market there,” Mater states. “Jabil has supported this very important investment.”
Additionally, Ingenico more than doubled its production capabilities at Jabil’s Vietnam manufacturing facility over a three-month timeframe. “We increased product capabilities from 200K per month to 500K per month as well as refined the full footprint of our operation,” Mater continues. “It’s also important to recognize the support of the local team in Vietnam as they worked hard to manage the capacity increase successfully.”
Aside from the rapid rise in production needs, Ingenico took advantage of the manufacturing consolidation to more closely integrate with Jabil’s supply chain capabilities. “It’s very positive to have one partner who can manage a worldwide business,” Jerome Junod, EMS & ODM purchasing manager for Ingenico Group, says. “We benefit from best practices and skills across factories, as well as a global supply chain for commodity management and procurement.”
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4. Does the manufacturing partner share your culture of excellence?
Sure, a manufacturing partner may be able to meet your pricing expectations and provide access to a global network, but does it share your dedication to quality, excellence and customer satisfaction? If your cultures don’t align, the relationship could easily fall flat.
SES-imagotag is also known throughout the industry for setting the highest quality standards, not only in product design but also across the entire production process. “Electronic shelf labels must work flawlessly over the full product lifetime, as a stoppage or failure could have disastrous consequences for a customer,” Erich Rohrhofer, head of production and quality for SES-imagotag, says. “Continual improvement in production quality processes are mandatory for everyone to be successful.”
Rapid product development and delivery are essential success factors as retailers grapple with constant competitive and cost pressures. As a result, SES-imagotag often accelerates product ramps, even when high levels of customization are required. “Usually we only have a very small time slot between the introduction of new products and rollout on the customer side,” Rohrhofer adds. “When you’re operating on a very tight schedule, you must depend on a highly skilled and powerful team to carry out the right steps and solve problems quickly and effectively.”
SES-imagotag recently recognized Jabil with an award commemorating a major production milestone. “It’s really amazing what we’ve achieved together as a team,” Weissensteiner concludes. “In the last 16 months, we’ve produced 10 million products with zero defects. I’m really looking forward to the next 10 million pieces in even less time, which reinforces our continued success with Jabil.”
Whether your retail solutions are in intelligent vending, smart payments, autonomous robots or other emerging retail technologies, a manufacturing partner can be key to a concerted team effort to ensure unparalleled product quality. Considering that 94% of retailers think technology partners are critical to their success, according to the Jabil survey, how will you answer the call? If you are in the search for the right manufacturing partner, make sure they have a dedicated customer workcell structure, global supply chain expertise, capacity to support rapid production increases and a corporate culture that strives for excellence above all.