MSC Industrial Supply vending machines

It does not occur to any of the sitcom’s characters to turn these hijinks into a business model, but now someone has.

MSC Industrial Supply (MSM) is one of the country’s largest suppliers of what are called “indirect supplies,” manufacturing tools and materials that don’t end up in the final products: drill bits, safety helmets, wrenches, clamps, saw blades, and the like. MSC will sell you a stapler, but most of its clients aren’t Dunder Mifflin-style cubicle farms—they’re manufacturing plants that cut steel or process foods or produce paper.

Over the past few years, MSC has started offering those clients the option of installing special vending machines on their shop floors. Some look like tool chests with touchscreens; others look a lot like snack machines. Workers who need supplies can skip the stockroom and go to the MSC machine, swipe an ID card, and choose whatever they need.

As MSC Chief Executive Officer Erik Gershwind sees it, his company’s vending machines bring a measure of order and transparency to a realm that, despite the trimming and kaizen-ing of everyone else in the supply chain, has remained enormously wasteful. He says the majority of indirect supply inventory never gets used.

“Picture a plant that has machinists and operators spread out all across the plant, and a centralized storeroom that houses lots of tools,” Gershwind says. “You’ve got to make sure your production line is up and running. So what ended up happening was, we go visit our customers and go around the floor, and each machinist is hoarding their own supply, hoarding their own stash.”

The MSC vending machines allow companies to keep a closer eye on how much of each part a plant needs and how much individual workers use. If there’s someone who seems to be going through a lot of supplies—either because he’s using machinery in such a way that causes it to wear out prematurely or because he’s taking stuff home to furnish his basement workshop—that can be addressed through education, a talking-to, or perhaps something more punitive. And the machines can be programmed to only release certain items to certain workers. The keys to a truck, for example, might only be available to someone who has a license to drive it.

For factory workers, there’s an obvious loss of control that comes with these sorts of systems. For companies like MSC, meanwhile, there’s a potential loss of business. After all, the more efficient its customers get at buying only the supplies they need, the fewer supplies they will presumably buy. Gershwind believes the company can counteract this by gobbling up a larger percentage of the shrunken pie. MSC’s vending machine business, he says, is growing “orders of magnitude higher than the company average.”

By www.businessweek.com

NEWS TAGS: industrial vending , industrial vending machine , tool vending