Ahead of Its Time: Acme Alliance Reaps Rewards of its Reshoring Model
Acme Alliance LLC received the 2021 National Metalworking Reshoring Award, but reshoring is nothing new to this die caster in Northbrook, Ill. In 2004, the company adopted a business model that features a global standard with regional production facilities on three continents. This forward-thinking approach has served the company well, especially during the current wide-spread supply chain disruptions plaguing the industry today.
In fact, the supply chain problems have allowed Acme to leverage its distinct competitive advantage, with new customers and projects coming in during a time of downturn for others.
“We’ve been preaching the benefits of reshoring for many years, and it seems today that everyone is agreeing with us,” says Acme President Mauri Zaccarelli Mendes. “We’re proud knowing that we’ve been doing the right thing, and the award is further proof.”
Proximity has its benefits
Acme makes custom finished aluminum die cast components for OEMs in the automotive, heavy truck, agriculture, recreational vehicle, and oil/gas industries. Plants in the United States, Brazil, and China produce components for clients within the regions where they assemble. The locations share a global standard regarding equipment, organizational structure, and capabilities, but with a regional supply model. This process provides a lot of benefits to its customers.
“Being close to our clients, we reduce lead times, inventory levels, transportation cost, administrative cost, and the cost of quality to name a few,” says Matt Thavis, Acme’s director of value stream development. “We can react quicker to scale up or down, and we are more in sync with our clients.”
OEMs have used conventional sourcing methods that choose overseas providers with a lower price per part. Although that seems like a prudent way to keep costs under control, problems with quality, delivery, and rework down the line can add costs later. In contrast, Acme focuses on the lowest total cost of ownership.
“We see our clients more often, so the relationship isn't solely built on cost,” Thavis says. “In manufacturing, there's more to consider than just cost. Quality, delivery, and risk are universal concerns for everyone. These close relationships have given us opportunities to work with customers to further their own kaizen goals like reducing inventory. We become an extension of their company.”
International corporations find it easy to work with Acme to supply identical parts for parts assembled around the world.
“Customers don't have to search for another supplier in a different country because we are prepared to supply from multiple locations,” notes Mendes. “We supply the same product with the same equipment under the same engineering process. It's a big advantage we have over our competitors.”
Recently, Acme won a job with a new client that brought 36 jobs back to the United States. The OEM had been using an overseas supplier, but supply chain problems caused it to rethink its overseas sourcing. Acme estimates that 20% of its U.S. sales in the past five years have reshored jobs, including positions at Acme and local partners for painting and assembly.
To grow this trend across many industries, Thavis recommends that OEMs have a diverse and regional sourcing approach to stay competitive and protect against the risk of costly disruptions.
“The industry demands a smaller, more scalable supply chain,” he says. “It makes no sense for any one item to be almost 100% sourced in a particular region of the world. The chip shortage is a perfect example. It’s crazy that such a small item can have such huge impact. Companies need to rethink the way they source goods.”
About the Author
As AMT’s Managing Editor, Kathy seeks out connections, builds relationships, and strives to learn more about the people of the manufacturing industry. A writer and editor with more than 25 years of experience on the topics of manufacturing, technology, architecture, art, and parenting, Kathy is an avid listener who is deeply curious.
Kathy is particularly interested in autonomous vehicles. Since she was a member of Team ENSCO in the 2004 and 2005 DARPA Grand Challenge, she’s been enthralled with the progress of self-driving vehicles.
When she’s not writing or mingling at manufacturing industry events, Kathy is spending time with her husband and four children creating art, visiting museums, hiking, traveling, and entertaining friends and family. She does try to sneak in reading, yoga, Sudoku, and long walks with her dog, Meadow.