It’s no secret: The COVID-19 pandemic led to a dramatic spike in e-commerce and overall consumer spending. Normally this is welcome news for the corrugated packaging industry. However, the 2020 spike went hand-in-hand with an unprecedented global supply chain breakdown that continues to cause delays and drive up pricing across many industries – ours included.
“We rely on raw materials – namely paper by the ton, but also adhesives, wood pallets, and other materials – to create our corrugated boxes,” explains Pete Suchora, Acme Corrugated Box Purchasing Manager since 2014.
“While most of Acme’s paper comes from North America, some is sourced from as far away as Spain, Russia, and Central Europe. Almost overnight in 2020, necessary materials became nearly impossible to get our hands on.”
COVID-induced labor shortages plagued paper and wood mills already struggling to procure their own necessary raw materials. A cold weather snap in Texas added insult to injury by further crippling adhesive suppliers. Suddenly, it was unclear when or whether Acme would receive the raw materials needed to continue making versatile, strong corrugated boxes.
“It was like a big snowball effect. I can laugh about it now, but it was a frightening few months,” Suchora says. “However, at that critical juncture, the value of our longstanding practices became clear.”
Suchora is referring to purchasing procedures at Acme that ultimately outpaced global hurdles and kept operations up and running.
“We’ve always kept two months’ work of raw materials supplies in our warehouses. This was a saving grace when the supply chain was at a standstill and when our suppliers were increasingly unable, at no fault of their own, to get us what we needed,” he says.
Of course, reserves only go so far. At one point in late 2020, trucks that typically deliver raw materials to the warehouses were instead sent right to Acme for immediate use on awaiting machines. Company operations were approaching dire straits – but were ultimately spared, thanks in large part to the future focus of Acme’s purchasing procedures.
“A benefit of having been in business for more than one hundred years is the longstanding, mutually beneficial relationships we have with our suppliers,” Suchora explains.
“We found out that several of our supply partners were actually turning down new business to ensure they could get us what we needed, when we needed it.”
How Acme buys from its suppliers played a huge hand in this courtesy.
“Especially with paper, many of our competitors do what’s called spot buying – ordering on an as-needed basis,” Suchora explains.
“We’ve always taken a different approach by ordering 60 days in advance. It not only helps our suppliers with their forecasting, but it also gives us ample supply and with it, peace of mind. The true value of this practice became clear the moment COVID hit. Our suppliers prioritized us. They went out of their way to get us what we needed when our larger supply chain couldn’t. We’re eternally grateful.”
Paper became so scarce in late 2020 that some competitors began asking if Acme could spare any. Amazingly, by this point the answer was yes. Then, contrary to initial concerns that client demand for boxes might wane due to COVID, demand actually increased – to the extent our Hatboro facility is currently expanding to meet demand.
“Like everyone else, we’re still feeling the impact of supply chain challenges, but our practices and strategies have paid off,” Suchora says.
“We are 100% certain that we can source the materials we need to continue delivering our boxes to customers without any interruptions – even if there’s another perfect storm of extreme delays and demand.”
Want to stay abreast of future corrugated packaging industry trends and activity?
Subscribe to receive Acme Corrugated Box blogs in your inbox as soon as they go live.
