While COVID-19 has seen manufacturing centres temporarily close around the world, SEW-Eurodrive Australia has kept its local supply chain secure and employees safe. ABHR speaks to Managing Director Robert Merola to find out how.
Benjamin Franklin, one of the founding fathers of the United States, once allegedly wrote, “if you fail to plan, you are planning to fail”.
This wisdom has been key to SEW-Eurodrive Australia’s response to the unfolding COVID-19 pandemic.
Robert Merola, Managing Director of SEW-Eurodrive, says he is used to planning for the unexpected.
“We always keep a large amount of stock available in the country because of the tyranny of distance between Europe and Australia,” he says.
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SEW-Eurodrive is a manufacturer of industrial drive technology, with its headquarters in Bruchsal, Germany. Its gearboxes, drives and motors have been used around the world for more than 85 years.
SEW-Eurodrive has operated the Australian branch of its business since 1982, where manufactured modular drive technology components are sent to be assembled. Local sales, service and technical support are available to meet the individual needs of businesses in the bulk handling industry as quickly and efficiently as possible.
This method of operation is potentially susceptible to global supply chain disruption at the best of times, as heavy machinery needs to be shipped thousands of kilometres to its desired location.
Recently, Merola says transit times from Europe to Australia have increased from required fumigations to combat the brown stinkbug, so the company was well prepared for further disruption.
“At the very beginning of [the coronavirus outbreak], we were advised that our production supply chain from France and Germany would be affected. We made the conscious decision to stock an additional million dollars’ worth of inventory in Australia to ensure we could assist all essential services that would need our help during the crisis,” he says.
“We now have more than $30 million worth of stock in the country, which has insulated us from the effects of any disruption.”
In addition to local stock, there are around 28 containers of international stock on their way to Australia in various stages of delivery, with schedules back on track.
The biggest impact to the company’s operation was the dropping value of the Australian dollar. This made it more expensive to import goods from overseas and as a result a temporary surcharge was added and wound back as the economy began to bounce back.
Merola says staying well-stocked has been important to serving its customers with competitively short lead times.
“We provide our customers with what they want, when they want it, making adjustments where needed,” Merola says.
“Our sales are up by around 30 per cent year-on-year compared to 2019, most likely due to bulk handling businesses looking to quickly purchase assets to ensure they’re also protected from disruption.”
Protecting its people
Merola says the company’s main concern through the world-wide lockdown and spread of COVID-19 is the safety of its employees.
“SEW-Eurodrive are fortunate that our facilities are spacious and the required distancing requirements are already met, we only needed to ensure the break areas and times were modified to meet the physical distancing requirements,” he says.
Staff who could work at home were then set up to allow them to work remotely, including Merola.
“I went in for a few hours a day to ensure the factory facilities are still operational and to help morale. About 67 of the around 250 people working at the company are now doing so from home,” Merola adds.
For two weeks in April, a skeleton crew ran production, while the company began to prepare its facilities to further encourage physical distancing and to deep clean the worksite.
Alongside a copious amount of hand sanitiser available for workers, SEW-Eurodrive has also implemented a temperature testing regime. All staff must be tested before they can enter the building, with a rotating sticker system to ensure that everyone knows who has been cleared.
“I’ve said to the staff that there have been no cases of COVID-19 at SEW-Eurodrive, and the only way that it can get there is if it is brought there. We want to provide a safe, hygienic workplace for all of our staff, which requires a team effort,” Merola says.
“Over the past 37 years of business, our main priority is to keep our doors open and ensure our workers can put food on the table for their families.”