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September 1, 2005
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Responsible freight practices in the adhesive market



An opportunity may begin with an adhesive requirement, but it doesn't necessarily end with an adhesive recommendation. At Chicago Glue Machine & Supply Co. Inc. (CGM), our job is done when the right product is safely in the customer's hands, on time and at a competitive price.

Supplying adhesives today means being informed on more regulatory issues than ever before. Freight and proper handling of all chemicals, especially hazardous materials, has received much attention since 9/11. Recruiting and promoting the right people is crucial for us to be responsive to customers' needs, one of which is freight management. To be of value to our customers, we feel it is important to continually update infrastructure, monitor regulation changes and partner with freight companies, suppliers, and industry associations.

People are what make a business successful. Proper training on how to safely excel at one's job is a way to show employees the consideration they deserve. It is critical that anyone who comes in contact with a hazardous material understands how to read the product's Material Safety Data Sheet (MSDS) before handling or working with the product.

As a company, Chicago Glue started as a two-man operation where information on any new materials was easily exchanged. Having grown to 22 employees, we now have to operate as a team to properly and efficiently convey information. This has to be done quickly enough to meet our goal of shipping an order the same day it is placed.

When shipping hazardous materials, the person responsible for coordinating the shipment must become certified on all applicable requirements. At a minimum, recertification is required every three years. Taking time away from daily activities to focus on digesting requirements for hazardous materials demands a disciplined approach. Doing the bare minimum is not what customers expect of their suppliers today. The only way we can grow is with customers who are satisfied with our work and appreciate the fact that we go beyond minimum requirements.

Despite the required - and recommended - procedures suppliers face when dealing with hazardous and non-hazardous materials, customers still expect their orders to be processed quickly. Today's information is conveyed at a rapid pace that cannot be maintained without the use of technology. Every position in the shipping and receiving department requires interaction with computer-accessible information. This can only be accomplished with faster computers, up-to-date software and employees who can keep up with both. To remain efficient throughout this process, we must reinvest in hardware, software and training time. Years ago, appropriate documentation for shipping hazardous materials called for a special printer that could complete a six-part form. Today, this is done with a custom form and a laser printer. Continual reinvestment in such systems is the only way to achieve operational excellence.

Customers today are faced with mounting pressures to keep costs down while increasing efficiency. These pressures are trickling down to material suppliers. Our customers need a supplier who can source the best adhesive as well as provide warehousing and freight management. Providing these services allows customers to run leaner and remain competitive in their respective markets.

In a recent survey published in Purchasing magazine, 500 purchasing agents were asked what buyers wanted from distributors. The number-one answer was quality. On a scale of one to 10, with 10 being the highest of importance, the second most important item was on-time delivery, ranked at 6.1 and up nearly 13% from five years ago.

Having recognized the importance of delivery in providing the highest quality products, CGM has partnered with UPS, a company that shares our high quality standard. Becoming a preferred shipper with UPS and using their advanced package handling programming has allowed us to provide exceptional service to our customers. On a number of occasions, we have received critical updates regarding the inevitable damaged product. With our proactive approach, we were able to replace the product before the customer even knew there was a problem.

True partnering is the only way smaller companies can grow. The following example shows how we were able to keep our costs down while helping our packaging materials supplier grow their market.

As UPS has grown, it has employed more automated systems that put greater demands on the performance of the packages it handles. As recently as two years ago, we worked with our pail manufacturer, Paragon Manufacturing of Melrose Park, IL, to help their pail become only the second 5-gal plastic pail approved by UPS for shipping. This is crucial, as it has been our experience that UPS will not pay a claim on an incident unless the shipper uses packaging tested and approved in their lab. Our partnership with Paragon resulted in fewer damaged shipments and faster payout on claims from UPS to CGM. Paragon, in turn, benefited from increased sales opportunities for their UPS-tested packaging. An additional advantage for both of our companies is improved economies of scale.

As a distributor, the majority of the business we support is local. We have relied on our relationships with local trucking companies to provide prompt delivery of product. In order to maintain our 98.7% on-time shipping rate, we sometimes need trucking companies for same-day delivery. Our relationships with key freight companies afford us competitive rates and special service when required.

For larger shipments, we prefer to recommend shipping with FedEx Freight to assist in supporting our customers' delivery requirements. FedEx has a record of safety and reliability that our customers can rely on every day. Since 9/11, FedEx has been proactive in properly handling freight, and the benefits to their customers are in the numbers.

"Since 9/11, most of the regulatory focus for motor carriers has been related to hazardous materials security," said Carl Thomas, managing director, Safety, FedEx Freight. "We see that with threat assessment requirements for hazardous materials drivers; safety permitting for carriers that transport certain hazardous materials; and new security requirements for hazardous materials transporters. All of these regulatory initiatives apply to motor carriers and were a direct result of 9/11.

"Obviously, many of our efforts have been focused on complying with these new initiatives. All carriers must now have security plans in place that focus on protecting hazardous materials from the time they are picked up until they are delivered," he said. "Security training involves our terminal operations as well as our drivers. Our hazardous materials training program now has a separate section on security, much like existing sections on placarding, shipping papers, etc.

"Security has always been a priority for us," Thomas added. "Thankfully, we have never had a hazardous-materials incident involving theft for the purpose of threat or harm. By working closely with our customers, and by continuing to upgrade our security processes and tools, we have confidence that this will continue to be the case."

The proactive actions of companies like FedEx are what give us peace of mind that we are doing everything in our power to reduce the risks associated with shipping hazardous materials.

Another important relationship that has helped our company stay ahead of the curve is our membership in the Adhesive and Sealant Council, Inc. (ASC). As a member of the ASC, we benefit from the hard work they do to lobby the government for practical changes in regulations. In addition, the ASC keeps us updated on what is changing in the industry, how we can try to shape these changes and the best way to comply.

For more information, contact Chicago Glue Machine & Supply Co. Inc., 750 N. Baker Drive, Itasca, IL 60143; phone (630) 250-0700 or (800) 419-GLUE (4583); fax (630) 285-0949; e-mail info@chicagoglue.com; or visit http://www.chicagoglue.com.

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