McCormick Paints Improves Inventory, Streamlines Production with BatchMaster Process Manufacturing

Like many small companies, McCormick Paints delayed upgrading its manufacturing technology, relying on a MS-DOS version of BatchMaster for far too long. Tired of augmenting the system with dozens of spreadsheets for production, inventory and reporting, McCormick Paints upgraded to a current version of BatchMaster’s Process Manufacturing application. The company gained modern manufacturing functionality improving data visibility and inventory and production management, while shaving hours off some tasks, improving cash flow, lowering material costs, and gaining real-time reports.

“BatchMaster works with us to ensure we get the most out of the system, which saves us a lot of time and money.” – Bradley Schatz, Research and Development Director, McCormick Paints

• Gained a modern process manufacturing application improving purchasing, production, and inventory
• Automated inventory, gaining real-time visibility and cutting 50 percent of data upload time
• Acquired technology support, gaining easy access to information and help creating dashboards
• Increased cash flow with more accurate inventory management, eliminating guesswork
• Gained accurate reporting for more efficient manufacturing operations
• Improved planning and decision making with data visibility across the organization
• Eliminated double entry into separate financial application, saving time
• Gained insights into best-selling products and items
• Improved ability to participate in regional buying program, lowering production costs while gaining a competitive edge

CHALLENGES

McCormick Paints has been manufacturing and retailing paint to professionals and individuals for over 60 years. Based in Maryland, the company formulates its paint specifically for the Mid-Atlantic region and caters largely to commercial painters through its 29 company-owned stores throughout Virginia, Maryland, Delaware and Washington, D.C. The company recently expanded to Baltimore through an acquisition.

The company operated two manufacturing locations for many years, but recently consolidated operations into larger facilities and offices in Frederick, Maryland, where it now makes, warehouses and distributes all of its paints.

A majority of McCormick Paints customers are commercial painters looking for large quantities – 6,000 gallons as an example – of exterior or interior paints in various shades of white or gray for apartments, housing complexes, condos and office buildings. The retail shops also carry a wide range of supplies they need. A very small percentage of customers are individuals. The company’s stores carry other paint brands and also offers specialty paint mixes.

Ran on MS-DOS-based Software & Spreadsheets

The company runs its financial operations on Microsoft Dynamics Great Plains and a separate instance of Small Business Central, and relied on a MS-DOS version of BatchMaster’s process manufacturing software for production and research and development. As the company grew, the MS-DOS-based software was no longer adequate to support the business.

“It was just archaic and we never updated it,” says Bradley Schatz, McCormick Paints’ Research and Development Director. “We no longer had support and knowledge was passed down over the years. We weren’t getting everything we could out of the system.”

“Reporting was tough and didn’t come out clean,” he added. “It required a lot of work and time to get the information we needed.”

Over the years, McCormick Paints supplemented its BatchMaster DOS software with numerous spreadsheets to track raw material inventory, purchasing and production, he says. It also used spreadsheets to handle weekly physical inventory counts at its two locations.

Previously, the production team ordered raw materials based on the production schedule. Some raw materials were purchased in large quantities and kept on hand to get a better price based on the market and membership in a regional buying group. However, the company wasn’t really able to capitalize on better prices because it didn’t have a very accurate picture of what it had already in stock.

“We physically had to search the warehouse to see if we had raw materials,” says Schatz. “There was no information hub to pull that information from.” As a result, sometimes they didn’t have the right materials on hand to mix its paint.

Sales orders housed in the disconnected financial system dictated production, which was planned based on the production schedule and availability of ingredients and packaging materials. The purchasing department ordered ingredients that weren’t in stock

“We were getting by with the existing system, but recently executives needed more timely information. Crystal Reports was stressed and we needed information that was more timely, accurate and that we could trust,” Schatz says.

Executives could look up paint formulas, he says, but it was difficult to learn from the old software the retail locations that sold it the most. The financial system did have some of that information, but entering it into the manufacturing software required manual intervention that typically took two to three days. “That affected the finished product side because stores would not have accurate information about what was in the distribution center or what stocking levels we had.”

SOLUTION

McCormick Paints executives were pleased with the manufacturing functionality that BatchMaster supplied; they just needed a much more modern version, Schatz says. They didn’t evaluate other vendors.

That’s because the BatchMaster Software process manufacturing modules include formulation, packaging management, costing, inventory, production, quality, planning, scheduling, lot traceability & recall, industry specific compliance, and mobile warehousing. The process manufacturing application can be integrated with existing financial packages including QuickBooks, Sage 100 & 300, Microsoft Dynamics GP and SAP Business One. The application can be hosted on-premises or in the cloud.

In addition to its functionality, McCormick Paints liked that BatchMaster provides on-going support that includes online training, a customer portal, and a dedicated support team.

BENEFITS

More Efficient Purchasing

The switch to the modern BatchMaster application provided immediate benefits. “The switch saved our purchasing department a heck of a lot of time,” says Schatz. “Now all the information we use is in BatchMaster, not spreadsheets.”

They’ve reduced the time it takes to conduct inventory counts by 50 percent, he adds. They export an inventory worksheet, fill it in with accounts and upload it in a fraction of the time it took previously.

The team knows two to three weeks in advance if they need certain raw materials, which gives purchasing adequate lead time to order out-of-stock items before production needs them. “Before we consulted previous purchases and guessed how much of an item we used per month and then tried to make sure we that that quantity,” Schatz says. That process wasn’t always accurate and let to overstocking, which hindered cash flow.

Having the inventory information in advance allowed McCormick Paints to lower material costs because it can participate more fully in its regional buying club. Without adequate forecasting or inventory information, McCormick Paints wasn’t able to take advantage of the lower club prices available.

“We weren’t able to be as efficient as we could have been,” Schatz says. “Now we can pull information and know in real time how much we need. It also stops us from being short or over-stocked. Previously, we always erred with having more than less, and now we can keep inventory levels at a more reasonable size.”

“The visibility when we first made the change was eye opening to see what we had in dollar amounts,” he adds.

Having real-time visibility proved crucial during the pandemic when individuals and building owners saw an opportunity to spruce up their homes and buildings and hired professional painters to help them. McCormick Paints’ sales skyrocketed when customers that typically purchased from enterprise paint companies couldn’t get the paint they needed.

“The larger firms couldn’t obtain their regular levels of raw materials and had to allocate sales to their biggest customers, which left a lot of people hanging,” Schatz explains. “Those customers had to search to find paint and came to us.”

Real-Time Reporting

McCormick Paints executives now have immediate insight into production reporting through dashboards. They no longer wait two to three days for information to be typed into one system from the other and that wasn’t accurate due to the older dates and lag time since the data was pulled.

Executives can view KPIs instantly, and know which store is selling which paints, which paint formulas sell quickly, and which store is selling the most paint and to whom.

Individual store managers also have accurate information on what’s in the distribution center and what stocking levels the company has.

Fully Supported

After years of trying to figure out the MS-DOS-based system by himself and juggling spreadsheets, Schatz now has instant access to the BatchMaster support team and support portal. “BatchMaster is really easy to work with and really saves me a lot of time,” he says. “They are very quick to respond to any kind of issue or general questions, and suggest changes to processes.”

The easy-to-use customer portal is easy to navigate and answers to questions are readily available. “They’ve answered any questions I have about whether the system can do this or that and whether I’m overlooking something or pulling data from the right spot,” Schatz says.

When he needed help creating certain reports or dashboards, the BatchMaster team was able to quickly build those.

Future Growth

With the modern BatchMaster manufacturing application, McCormick Paints is much better positioned to reach its five-year plan to increase in size, total sales and value of the company, Schatz says.

“Now we have the ability to grow into that goal,” he says. “BatchMaster is willing to work with us to ensure we get the most out of the system, which saves us a lot of time and money. Being able to identify our inventory levels and keep them at the right place allows us to have the best cash flow.”