TomkinsInternational-SCLF-8-12-2015-Last-Final-Look

SUPPLY CHAIN LEADERSHIP FORUM

AUGUST31- SEPT. 2, 2015 SAN ANTONIO, TX

Non-Profit Service Providers: COST EFFECTIVE SOUTIONS

within the Supply-Chains

Overview: A quick lookWho we Are: We operate a large and growing Social Enterprise on the East Coast. We are a nonprofit third party service provider that has been providing cost-effective B2B value-added secondary packaging, contract packaging, assembly/kitting and fulfillment services over the past 35 years. Employ 200. A Nonprofit is just a TAX status Only and we operate as business. No money…No Mission. Social Enterprise: These are organizations typically nonprofits that apply commercial strategies to maximize improvements in human well-being. This may include maximizing social impact rather than profits to external shareholders. Many consider this a double bottom line and a blended or shared value model as well. Our Commercial Value Proposition: Provide consumer centric driven, customized, cost-effective, value-added service solutions to streamline process to enhance a company’s bottom line. Our Social Impact Value Proposition: Provide sustainable and meaningful jobs for people with disabilities and others whom face significant barriers to employment.

OUR NEW BRAND: Our name signifies the core essence of our unique model. Working side by side and together with industry to achieve common goals.

Location: Olean, NY 14760Travel Distances to our facilities

Some Terms and Definitions:

1. Non-Profit Organization -NPO –is an organization that uses surplus revenues to achieve its goals rather than distributing them as profit or dividends.

2. Triple Bottom Line- TBL-adds two more “bottom lines,” social and environmental concerns. All three together are often paraphrased as: Profit-People-Planet.

3. People with Disabilities-PWD-Disability is a consequence of an impairment that maybe physical, cognitive, sensory, emotional, developmental, or some combination of these.

4. Corporate Social Responsibility-CSR-is a form of corporate self-regulation integrated into the business model. CSR Policy functions as a built-in self regulating mechanism whereby a business monitors its active compliance with the spirit of the law, ethical standard, and international norms.

Convergence Movement: Social Enterprise Models are Growing !

Main types of value-added servicesupply-chain operations most Nonprofits offer?

Forward Logistics: Secondary Packaging, Contact Packaging, Co-Packing, Assembly, kitting and fulfilment. Retail Ready-Customization projects: Shelf Ready, Display Ready, and Replenishment Ready. Point of Purchase Display pack-out operations, bagging, repacking, and more including operating franchises.

Reverse Logistics:Operate as a node and decentralized product returns processing centers. Compliance functions: 100% Auditing, QC, sort & report, inspection, triage and gate-keeping etc. Re-Packing, sorting, and high-touch operations. Light assembly, disassembly, and rework. Sustainability programs, take-back/salvage projects. Closed loop re-use and recycling programs. Easy Depot Repair operations: Plug n Play, and level 1 triage operations. As most consumer electronics returns, 75% + have no trouble found. Food Reclamation centers and reuse facilities. Parts Harvesting.

Top 10 Reasons:What do Nonprofits bring to the

Party?1. On-Demand, large labor force that is cost effective, and typically is a

budget neutral or better solution.2. Added flex space /capacity and act as a node or satellite returns location

to reduce freight spend in RL which is a high-cost factor.3. High-touch jobs and high-velocity jobs you can outsource.4. Great way for a company to demonstrate Corporate Social Responsibility.5. A unique way to achieve the Triple Bottom Line.6. RL can not be fully automated and still requires touches in the process.7. Level 1 types of operation like -plug-in play. Pre-screen before products

get sent to a repair depot or facility with higher labor costs.8. Easy to integrate IT systems- keep product tracking and flow visible.9. Non-profits have been doing RL operations for decades and doing the

operations required in reverse logistics is their core competency.10. RL is a non-core activity that should be outsourced. Nonprofits do many

of the common RL functions very well.

What are Corporations doing now with Nonprofits and the disabled?

OEMs-Retailers, 3PLs, Liquidators, and CPGs all utilize nonprofits/employ the disabled:

Forward and Reverse logistics operations. Wal-Mart: E-recycle Initiative- utilizes non-profit network. Also, have

a goal of hiring 100,000 disabled veterans Canon: Accessories-parts-re-kitting and various RL operations Dell: Recycle computers-Goodwill Industries Target- Australia utilizes Disability Works Australia. (DWA) Walgreen’s: DC and store operations, and Lowes: DC- operations P&G: Flexi-Center-Tambrands- Auburn, ME- 30% total workforce-

(Have a Physical or Developmental Disability). Asked why they are doing this: Cited a study that showed over 70% of consumers would switch to a brand that supports a great social cause.

Microsoft: Started pilot in 2015 to hire autistic folks. UK: Remploy works with 2,500 businesses to place and hire PWD.

Telenet & BW IMSIR: A Triple Bottom Line Example

E-Cycle Ltd.- UK

Why Utilize Nonprofits in (RL) Reverse Logistics ?

Problem:The three key issues with Reverse Logistics:

Sustainability, Risk mitigation and optimizing product recovery values.

Labor + Transportation costs are the main cost factors in RL.

Solution: There are over 2,400 service providers in the nonprofit

network in the US. (map-slide 23) Reduce freight spend by using these sites and locations. Untapped Labor Force: Unemployment rate among people

with disabilities (PWD) is 80% PWD excel in repetitive, and rouge process work The operations can stay within the US and cost neutral

HP Hood-Enclave-Winchester, VA

What are the Numbers?

56.7 Million or 19% of the US population disabled. US Census-ADA

566,188 Intellectual and Developmentally Disabled people getting services in the US. (2013) (ICI –UMass)

Only 20.1% of these folks are working in an integrated employment setting. (ICI-UMass)

The current unemployment rate with people with disabilities is near 80% in the US.

Over 56 million people in the US have a disability. This customer market segment is often overlooked and represents a total of billion dollars in annual disposable income or purchasing power.

2014-Disability in the USA-Map

Business Case:Why create jobs for people with

disabilities ?

Nonprofits have a dedicated workforce to get your projects done… on-time

Scope of the Opportunity: The Employment Gap

RL market size & segments: The Need

What are the 10- R’s in Reverse Logistics?

Nonprofits have many capabilities and capacities to leverage

Nonprofits have new operations and facilities to grow your business

models

Image Microsystems:Printer remanufacturing

Where are the Nonprofit Service Network Providers located that provide jobs for people

with disabilities?

Dispelling the MYTHS: The Facts

Walgreen’s -Data Analysis Findings: 1. Productivity: There was no difference in picking rates for people with disabilities

than the rest of the workforce.2. Turnover: Turnover for people with disabilities was 48% less than the rest of the

workforce.3. Safety: In every measurement, people with disabilities were safer and costs were

lower. (based on the four metrics below) A. Relative incidents-accidents per 1,000 motion hours.B. Relative comparison of incidents/accidents/1,000 hours. C. DART and OSHA Recordable.D. Workers Compensation Costs Per Case.

Sears: Costs to Reasonably Accommodate: 1978-1996 data: The total 436 people during this period: 69% of these were $0. cost, 28% were less than $1,000. and only 3% cost over $1,000 -to make worksite accommodations.

Best Practice: Walgreen’s five-prong approach with

Corporate Social Responsibility (CSR)

2013: Diversity Inc-Top 10 Companies for hiring People with Disabilities

1. Ernst and Young2. Proctor and Gamble3. IBM4. KPMG5. WellPoint6. AT&T7. Kaiser Permanente8. Prudential Financial9. Microsoft10. Accenture

Summary

The Nonprofit network and its labor force in the US is a hidden but an untapped asset & outsourcing solution for the reverse logistics industry.

Nonprofit is just a tax status. They do the many of same types of operations/functions and process steps in RL as the For-Profits do.

You can create jobs or create inclusion for PWD within your operations.

The entire RL process will never be completely automated and labor is needed. Nonprofits offer a cost effective solution for companies to achieve their zero waste/sustainability goals and objectives.

Strongly encourage industry to tour nonprofits doing RL functions and explore doing potential pilots, partnerships, and collaborations.

In Closing….

1. Want to explore innovative ways to streamline your Supply chain process, minimize your costs, enhance speed to market, or increase the recovery yields on your products?

2. Want to proactively embrace your company’s CSR- corporate social responsibility policies?

3. Want great customer service and the employees of your logistics vendor/partner to “truly” love and appreciate working for you?

If you answered “YES” to any of these questions, then you need to reach out to a nonprofit service provider and explore how they can leverage their resources to help your company.

Creating jobs for people with disabilities makes everyone smile

Logistics and Supply Chain executives need to change their

thinking !

Insanity: Doing the same thing over and over again and expecting the different results.

- Albert Einstein

Questions?

Thank You

Brian F. Eddy, MBADirector, Business Development & Marketing

The ReHabilitation Center (716) 375-4730, ext. 353 beddy@rehabcenter.orgwww.rehabcenter.org