Welcome to Supply Chain now the number one voice of Supply Chain.
Speaker AJoin us as we share critical news, key insights and real Supply Chain leadership from across the globe.
Speaker AOne conversation at a time.
Speaker BHey, good morning, good afternoon, good evening wherever you may be.
Speaker BScott Lewton and the one and only Kim Reuter with you here on Supply Chain now.
Speaker BWelcome to today's Live Stream.
Speaker BKim, how we doing today?
Speaker CDoing fabulous.
Speaker CHow about you?
Speaker BWe're doing great.
Speaker BWe've dodged all the storms.
Speaker BA bunch of storms came through yesterday and today got a ton of rain.
Speaker BBut everybody's safe and sound.
Speaker BAnd I still have all my trees as I'm looking out here which those tall pines, Kim, they can make you a little bit nervous sometimes, huh?
Speaker CThey can.
Speaker CThey can.
Speaker CSo I've got your weather now up here in Virginia and I am watching the rain and the trees.
Speaker CSo far we're doing all right.
Speaker BThat's good.
Speaker BThat is good.
Speaker BWell, folks, speaking of good stuff, we got a wonderful show here, the Buzz where you all know every Monday at 12 noon Eastern time, we discuss a var of news and developments across global supply chain and global business.
Speaker BAnd it is a busy, busy, disruptive time.
Speaker BRight?
Speaker BLots of great topics here today.
Speaker BIt's a manufacturing Monday.
Speaker BKim, we love talking about manufacturing, don't we?
Speaker CWe do.
Speaker CAnd it's very timely.
Speaker BI would say it is very timely.
Speaker BWe're going to be talking about the US Manufacturing workforce needs.
Speaker BWe're going to talk about what March saw in terms of manufacturing activity.
Speaker BNo telling what April's going to see, but we'll save that for later.
Speaker BWe're going to be discussing contract manufacturing in particular, including what organizations should looking for when they are selecting the right contract manufacturer.
Speaker BAll that plus a whole bunch more.
Speaker BAnd Kim, at 12:15, thereabouts, we're going to have a very special guest joining us as Keith Smith, president CEO of Vono Products, will be stepping in and sharing some good stuff with us.
Speaker BSo Kim, if we're going to start our disruptive Monday, we got to get in a little bit of buzz, huh?
Speaker CWe do.
Speaker CAnd there's a lot of it.
Speaker BThere is a lot of it.
Speaker BHey, and we love to hear perspective and comments from out there from Trisha.
Speaker BHappy Buzz day.
Speaker BAppreciate what Amanda and Trisha does behind the scenes.
Speaker BAnd David's back with us.
Speaker BReally enjoyed David's perspective last week on the Buzz.
Speaker BGood morning from Toronto.
Speaker BGood morning to you as well, my friend.
Speaker BHope you're doing well.
Speaker BAll right.
Speaker BTwo things before we get started, folks.
Speaker BJust like David and Trisha, it gives your take in the comments, whether you're tuned in via LinkedIn, YouTube X Facebook, Twitch, no matter.
Speaker BLet us know what you think.
Speaker BAnd if you enjoy the show today, we'd love for you to share it with a friend and your network.
Speaker BThey'll be glad you did.
Speaker BOkay, Kim, we've got several things to touch on before we welcome in our outstanding guests, and I'm going to start with some resources.
Speaker BI'm going to start with some resources, folks.
Speaker BWe all know that shipping costs are a significant part of doing business, especially for e commerce companies.
Speaker BKim can tell you all about that.
Speaker BFrom carrier fees to packaging supplies, these expenses add up fast.
Speaker BHowever, the good news?
Speaker BWith the right strategies, you can drastically reduce these costs while still maintaining an excellent customer experience.
Speaker BThat's the name of the game.
Speaker BSo to that end, our friends at easypost have put together a new ebook to help companies find practical ways to save money on things such as carriers, warehouses, packaging, labor, and a whole bunch more.
Speaker BYou can download your free copy of this ebook today.
Speaker BEbooks everywhere Kim.
Speaker BEbooks everywhere.
Speaker BOkay, I need an ebook library, but hey, easy post is on the move.
Speaker BSo folks, check out that resource.
Speaker BHow about with that said.
Speaker BSo this is our latest edition of our almost weekly newsletter dropped over the weekend and as always, Kim, we took a Baskin Robbins approach and offered a variety of great information.
Speaker BFirst, in light of all the tariff and trade policy disruption, I love this quote that we shared up near the top of the newsletter.
Speaker BIt came from a recent webinar guest Ken we were talking about this in the green room pre show Omar Nasha Shebi, who has spent over 25 years our nation's capital, working on trade policy and many other things.
Speaker BWell, he shared this quote with us on Thursday.
Speaker BThat was a hit.
Speaker BThere's an old line that says if you are worried about all the problems we have in Washington, just wait till you see our solutions.
Speaker BQuot oh, that hit us.
Speaker BHit a lot of folks right in the bones.
Speaker BIn the bones, yes.
Speaker BBut on a lighter note, more important note, perhaps one of the key topics, and with that said, was that of the manufacturing workforce.
Speaker BSo get this Kim.
Speaker BAccording to Carolyn Lee over at the Manufacturing Institute, a recent study determined that the US manufacturing sector will need some 3.8 million workers by 2033 and some projections suggests that 1.9 million of those jobs may stay empty.
Speaker BSo we got a lot of work to do to grow the talent pipeline coming into the manufacturing world as well as developing new skills for our current talented people.
Speaker BSo in this recent Supply Chain now podcast which you'll find kind of summarized in this edition.
Speaker BWith that said, I sat down with Carolyn Lee and she shared a couple of terrific programs.
Speaker BKim get these Heroes Make America program that helps transitioning service members, veterans and military spouses, which oftentimes get left out in the cold, but it helps all of those wonderful folks step into modern manufacturing careers.
Speaker BHeroes Make America.
Speaker BAlso fame F A M E, which is an acronym, it was started by Toyota probably 20, 30 years ago.
Speaker BThat helps equip people with the technical skills needed for roles like advanced maintenance technicians and all sorts of other technical roles.
Speaker BSo, folks, you got to check out these two programs in this edition of with that said, we gave an update on Starbucks and their transformation efforts, which has been ongoing.
Speaker BWe talked about a new leveraging logistics for Ukraine conversation and offered up a profile of our friend Marty Parker.
Speaker BAll that, plus all our upcoming live events that we'd love for you to be a part of.
Speaker BKim, I know you had a busy weekend, but did you have a chance to take a look at with that said and what stood out to you?
Speaker CSo I did.
Speaker CIt was the manufacturing piece that really stood out to me because we're talking a lot about manufacturing in the United States, right.
Speaker CWe had Liberation Day last week.
Speaker CWe our whole goal is to move more manufacturing back into the United States.
Speaker CAnd it's interesting because we're talking about having a labor force ready to work.
Speaker CDo we have a skilled labor force ready to take on all this manufacturing work that we're expected to see in the United States in the next, like, almost immediately?
Speaker CRight, Right.
Speaker CAnd I think that's a big question.
Speaker CAnd when we look at what happened four or five years ago, right, when we got the initial tariffs, that happened and companies started to try to do that quick outsource, right?
Speaker CWe're like, oh, just go manufacture somewhere else.
Speaker COkay.
Speaker CAnd so they moved to Vietnam or India or, you know, a variety of other places are like, yeah, we'll just outsource our ship, our manufacturing, super easy.
Speaker CIt was not.
Speaker CThere was a lot of failure and a lot of manufacturing went right back to China.
Speaker CAnd we just figured out how to eat that extra tariff money.
Speaker CBut we're upping the game now, so tariffs are coming more and more.
Speaker CSo we are going to have to move manufacturing back into the U.S.
Speaker Cbut do we have that skilled force ready?
Speaker BYou pose several great questions there that are timely, are important, are clearly we're plugged in the industry because that's probably in light of everything going on, I think one of the most things that we Got to keep front and center is, are we ready as a country between workforce and infrastructure?
Speaker BYou know, we got plenty of work to do, strengthen the infrastructure, power and electricity and whatnot.
Speaker BSo we're gonna see, you know, we're.
Speaker BWe're gonna create a whole new podcast series focused on what we're seeing, folks.
Speaker BBut anyway, folks, check out with that said and give us your take on anything you see in there.
Speaker BAnd one thing I want to call out to, folks, do yourself a favor.
Speaker BOmar Nashashibi gave a master class on things to look out for.
Speaker BHe brought tons of resources.
Speaker BMark Gillum with ENABLE joined us, and I'll tell you, it was must see.
Speaker BNot many webinars are must see webinars, but in light of everything going on now and where we're headed, you got to check that out.
Speaker BSo maybe Amanda and Trisha can drop the link to last week's very live episode.
Speaker BWe got a lot of feedback around that one.
Speaker BOkay, I want to hit one more thing, Kim, before we bring in an outstanding guest, and that is, I love your blog articles.
Speaker BI read every single one of them, and that should be required reading.
Speaker BAnd last week, you dropped this one around organizational firefighting and those valuable fire preventers, which you touch on.
Speaker BSo this one caught my attention on the day.
Speaker BWe got a love on our firefighters, right?
Speaker BBut we got to recognize that we got to get to root cause and limit, eliminate at least a large part of the need for this highly reactive role.
Speaker BBut I'm not gonna steal your thunder.
Speaker BTell us more about what the message you were conveying last week.
Speaker CSo this is a really interesting lesson that I learned at Amazon.
Speaker CWe had a new SVP that came in by the name of Marco Netto.
Speaker CAmazing leader, a lean leader.
Speaker CI learned a ton about lean from him, but he had this whole philosophy about not rewarding firefighters, and it really revolved around the amount of resources that firefighting takes.
Speaker CRight.
Speaker CSo when we're in the middle of a firefight, we've got, like, several people fol focused on the issue.
Speaker CThey're working all kinds of hours.
Speaker CWe're sucking all kinds of resources from other teams because we're trying to put out this huge, catastrophic issue that's, you know, in a lot of situations was affecting the Amazon website.
Speaker COrders couldn't be taken, Credit cards weren't processing.
Speaker CWhatever it was was a big problem.
Speaker CBut it started to create a culture of rewarding these people who went through all of this work to save the day.
Speaker CBut it never got down to what was the actual root cause.
Speaker CSo he was bringing in these lessons that were about, like, what actually caused the.
Speaker CAnd how could we have prevented the issue from happening in the first place?
Speaker CBecause we don't want to do anything that's ever going to impact the customer ever, ever, ever.
Speaker CWe want everything to be as smooth as silk.
Speaker CEvery time they get into that checkout pipeline, no want you to think about it, just hit that buy button.
Speaker CAnd so that was really the focus of it was when we start to reward this behavior of, you know, oh, me and 14 people spent five days putting this to help.
Speaker CWell, how much did that actually cost us, right?
Speaker CAnd what would it have cost us if it had never happened?
Speaker CAnd so sometimes what I have seen, especially in startup cultures who are trying to emulate Amazon, right, they're like, we want to be Amazon.
Speaker CWe're going to be the next big Amazon.
Speaker CThey do start to reward the firefighters because they think that's how it's made, right?
Speaker CBecause it's drama and it's sexy and, oh, we did all this crazy stuff.
Speaker CBut the truth is, is that building good, strong, really amazing companies, especially supply chains, is the most unsexy and the bors thing you'll ever in your entire life.
Speaker CBecause if nothing's happening, everything is perfect, folks.
Speaker BTake that look, David put it as best.
Speaker BThat is pure gold.
Speaker BI completely agree, David.
Speaker BAnd I'm telling you, there's a lot more that Kim can speak on from been there, done that perspective that more organizations need to listen to.
Speaker BAnd you know what, it kind of runs.
Speaker BI think you kind of spoke to this and we're going to drop a link to your blog article.
Speaker BYou kind of spoke to.
Speaker BDo we reward, do we not reward firefighters?
Speaker BAnd probably intuitively we want to hug and love on all the folks that saved the day, but if we don't kind of to one of your many points, if we don't get the root cause and we bake that firefighting into the culture, it's going to stymie growth, frankly, it's going to lessen the employee experience because they've got to, you know, work overtime or do whatever it is to save the day.
Speaker BAnd that's where, Kim, the five whys, in some cases the 10 whys, so we can get to root cause and make sure that so much of this, at least 80%, if you think of about it from an 80, 20 standpoint, won't happen again.
Speaker BRight?
Speaker CYou hit on a really great point, especially with startups, is that if they start to bake this into the culture, it does stall their Growth, they don't get it, right?
Speaker CThey're, they're like, ah, but we're at a billion dollars.
Speaker CI'm like, that is like in today's startup world, a billion is like a million ten years ago.
Speaker CRight?
Speaker CIt's great.
Speaker CIt's good that you got there.
Speaker CBut I see a lot of companies that get to a point because they built this into their culture, they can't get out of it.
Speaker BIt.
Speaker BOkay, we're gonna have several ideas for new podcast series here.
Speaker BKim.
Speaker BTariffs and stuff and then of course, firefighting and many other things.
Speaker BJeremy, we're talking about baking firefighting into cultures.
Speaker CHe's right.
Speaker BToday's startup world is CMM level one.
Speaker BIt's like a Mario game or something.
Speaker BJeremy, good to see you as always.
Speaker BOkay, Kim, I love it.
Speaker BWe're gonna recircle this.
Speaker BMaybe we'll break this into one of our upcoming podcasts.
Speaker BBut we've got an outstanding guest here today as we continue this theme of manufacturing Monday right here on the Buzz.
Speaker BSo Keith smith brings over 25 years of industry leadership and experience to the table.
Speaker BHe has served in a variety of critical roles in the manufacturing world, especially from papers and plastic in that sector, including two year stint as general manager of the largest division for a billion dollar paper company.
Speaker BBig stuff in his background.
Speaker BBig stuff he's up to now.
Speaker BSo I want to welcome in Keith Smith, President CEO of Von Co Products.
Speaker BHey.
Speaker BHey, Keith.
Speaker BHow you doing?
Speaker DAh, wonderful.
Speaker DGood to see you, Scott And Kim.
Speaker BGreat to see you as well.
Speaker BKeith, I bet you were chomping at the bit to jump into that last topic we were talking about, which is firefighting in our organizations.
Speaker BHuh?
Speaker DYou couldn't hear me?
Speaker DYeah, no, it's great.
Speaker BOh, it is.
Speaker BWell, I'll tell you what, we're gonna make management science series here, Kim and Keith, and we'll have to have Keith back home, but we got a lot of stuff to get to here today.
Speaker BKeith, we're gonna start though with a fun warm up question.
Speaker BKen, Keith, y'all know what I like to do around here?
Speaker BI like with a fun humanizing question.
Speaker BAnd we got to go in here today, folks.
Speaker BHere in the US it is National Beer Day.
Speaker BNow get this.
Speaker BIt celebrates April 7th way back in 1933, which is a day that the Cullen Harrison act was signed into law.
Speaker BWhat'd that do, you ask?
Speaker BWell, it eliminated the prohibition on selling beer across the country.
Speaker BSo a lot of times I kid around saying parades on each of these national or international days.
Speaker BWell, I bet there were parades back in 1933 when you could buy a beer again.
Speaker BSo with that, Keith and Kim.
Speaker BKeith, tell us, what is one of your favorite beers that you're going to enjoy here today to help celebrate National Beer Day?
Speaker DWell, sitting here in Wisconsin, we really appreciate having a National Beer Day.
Speaker DSo of course, Miller Light is made here in Wisconsin.
Speaker DYou got a big culture of beer, cheese and sausage.
Speaker DSo maybe I'll stick with a domestic Miller Light, but I do enjoy a Guinness from time to time.
Speaker DBut mostly a wine guy.
Speaker BOkay, I like it.
Speaker BKeith, sign me up for all that, especially back on the cheese and sausage and beer man.
Speaker BSounds delicious.
Speaker BKim, that made me hungry.
Speaker BHow about you?
Speaker CA little bit, but it did.
Speaker CI'm a Guinness style girl, so we have Guinness and Common.
Speaker CYep, that's my favorite beer.
Speaker BLove that.
Speaker BI enjoy Blue Moon.
Speaker BI've enjoyed Amstel Light back in the day and Sol S O L the Mexican beer, which is terrific and it's really grown its market presence.
Speaker BSo I'll have what y'all are having.
Speaker BHow about that?
Speaker BAll right, so Keith, let's level set a bit first before we get into some good stuff for the three folks out there that may be new to you or Vanko Products, tell us a little about yourself and your company.
Speaker DYeah.
Speaker DVon Co Products is a contract manufacturer, mostly serving medical device companies and consumer product companies.
Speaker DWhat we do is making either disposable products for fluids in and out of the body.
Speaker DSo think IV bags, tube bags, fluids in, fluids out, your collection bags, drainage bags, or we make the packaging.
Speaker DWe make sterilization packaging and barrier packaging for many of these devices in consumer products.
Speaker DWe also do a fair amount of.
Speaker DWe're not in the food side of the space, but we're in more of the pharmacy side of.
Speaker DOf the grocery store aisles in shampoos and cleaning, health and hygiene and household chemicals.
Speaker DBut the expounded pouches, like applesauce pouches, we're starting to be able to move away from heavy plastics to much lighter weight plastics in that grocery aisle.
Speaker DSo those are the main areas that Vanko serves.
Speaker BAnd Kim, we had quite the pre show conversation.
Speaker BI brought up the topic of metal stamping and of course that led to contract manufacturing.
Speaker BAnd then I got a masterclass between you and Keith about shifts we've seen over the last couple decades, huh?
Speaker CYeah, we've seen a lot of shifts in manufacturing.
Speaker CKind of when I was sort of getting into the business, we were really starting seeing a lot of outsourcing of product manufacturing.
Speaker CAnd it's interesting And I think a lot of people who are not involved in supply chain and don't understand how supply chain works and I bump into a lot of it, more than you would think is that, you know, as an example, the American made car, like with tariffs is very top of mind right now.
Speaker CFord, Chevy, Dodge, those companies we think of American cars, 80% of those are made from imported parts estimated.
Speaker CNow get me, somebody's going to pull out one Ford and be like, but not this Ford in general, they're mostly made from imported parts.
Speaker CAnd that goes for a lot of what we see and what we consume in the United States today.
Speaker CAnd so this whole old mindset or antiquated way of thinking that Ford makes all its own parts and all its own and it's a Ford is a Ford, Your Ford may be more Dodge than it is Ford and your Chevy may be more Dodge than it is Ford.
Speaker CThat's just way manufacturing works today.
Speaker BYeah.
Speaker BTell you, the automotive industry in and of itself is so fascinating and we'll see in the coming weeks and months, that conversation is not going away anytime soon.
Speaker BOkay, Keith and Kim, as we mentioned, this is Manufacturing Monday here on the Buzz and I want to highlight this great read from our friends at Manufacturing Dive.
Speaker BLet's take a look at some recent data on the US Manufacturing sector.
Speaker BSo again, as reported by Manufacturing Dive, a lot of folks are still bracing themselves as we see the continued impact from, as Kim mentioned, Liberation Day last week.
Speaker BNot sure if that title is accurate or inaccur, but save that for another show.
Speaker BStay tuned.
Speaker BWe talk a lot more about that.
Speaker BBut meanwhile I want to look at the US manufacturing activity and data from March 2025.
Speaker BSo get this Kim and Keith, ISM's purchasing managers index, we talk about this all the time.
Speaker BThe PMI folks, it showed overall contraction in the US Manufacturing sector last month just after we got a little bit of good news in February.
Speaker BFebruary had shown some, at least a little positive movement and some mild expansion.
Speaker BNow specifically new orders dropped in March according to ISM PMI data.
Speaker BNow some attribute that to a few of the disagreements between supplier buyers and customers in terms of who's going to pay for tariff driven price increases.
Speaker BWouldn't you like to be a flat on the wall for some of those conversations?
Speaker BOr maybe not.
Speaker BOf course a whole bunch more uncertainty over near term demand was also a factor.
Speaker BNow get this.
Speaker BSpeaking of uncertainty, Timothy Fiore, who's always quoted, he's the chair of IASM's manufacturing business survey Committee, he's always quoted in These releases, he said, quote, the manufacturing economy is struggling primarily due to the tariff uncertainty.
Speaker BSince we spoke a month ago, there's more confusion and more uncertainty and that's why our PMI number is now weak, end quote.
Speaker BNow, the data was similar over at S&P.
Speaker BGlobal reactivity dropped month over month, meaning February over March.
Speaker BBut here's one data point that their research showed.
Speaker BAT S P, input price inflation in March rose to its highest level since August 2022.
Speaker BOkay, so Keith, we tried to summarize a lot more in the data, folks, and y'all check it out.
Speaker BWe're gonna drop link, right?
Speaker BActually, Trisha's already dropped link right here.
Speaker BGo check it out on your own.
Speaker BBut Keith, you've been in this room for a long time.
Speaker BYou're leading a manufacturer now.
Speaker BYour thoughts on what you're seeing out there?
Speaker DHe hit the nail on the head.
Speaker DIt's the uncertainty that's causing the slowdown.
Speaker DYou're not going to make big purchases.
Speaker DYou're going to kind of wait and see as long as you can, especially as prices are changing.
Speaker DWe are very domestic supply base, but we do have a few overseas suppliers that pricing is changing while on the water, let's call it.
Speaker DAnd so that is a bit challenging to deal with as you've made contracts and commitments on, on one end of the business compared to the cost side on the other side of the business.
Speaker DSo certainly a wait and see look is where most of my suppliers and customers are sitting.
Speaker BYeah, Keith, excellent point.
Speaker BAnd Kim, that reminds me some of Keith's perspective there.
Speaker BI think Mary Barra, the CEO of General Motors mentioned, I'm gonna paraphrase her quote from a few weeks ago.
Speaker BShe basically said we're not gonna spend billions and billions of dollars when we're uncertain about where we're going is kind of what she was quoted as saying.
Speaker BBut Kim, whether it's commenting on something Keith shared there or what you're seeing out in the manufacturing industry right now.
Speaker CYou know, we did see a surge in Q4 of last year.
Speaker CAnticipation after the elections.
Speaker CWe knew there was going to be some tariff activity coming.
Speaker CSo we did see a surge.
Speaker CA lot of manufacturers kind of front loaded in Q4 of last year.
Speaker CConsumer spending is starting to tighten.
Speaker CWe're seeing a little decreases in luxury spending.
Speaker CRestaurant spending is down all time high and people being behind on their mortgage payments, credit card statements or our balances are at an all time high.
Speaker CSo we're entering an era where people are already uncertain.
Speaker CInflation has not really been letting up and now we're going to have taxes and additional duties on almost everything that we consume.
Speaker CSo there is a ton of uncertainty.
Speaker CConsumers are very worried.
Speaker CWe're starting to see some hoarding.
Speaker CPeople are moving ahead with big purchases like cars, automobiles, appliances.
Speaker CTrying to get those in before there is additional tariffs on those.
Speaker CBut people are starting to panic, Panic.
Speaker BYou know, I hope you're wrong and I hope it's quelled.
Speaker BI think we all do probably.
Speaker BBut speaking of big purchases, we had to go out and order a dagum dryer over the weekend.
Speaker BThat is the last thing I wanted to do.
Speaker BBut when your heater goes out, you have limited technical skills.
Speaker CLook, you're doing it now.
Speaker BThat's right.
Speaker BYou know, and we're seeing more to your point, Ken, we are seeing more of those purchases ahead of time, folks.
Speaker BTrying to get out ahead of what the weeks coming up and months are going to bring.
Speaker BThis may be Andrew again.
Speaker BHe kind of asked rhetorically how long we'll wait and see.
Speaker BWill we be in that wait and see mode.
Speaker BYou think there's got to be a tipping point in moving forward.
Speaker BHey, if I had answers to that, I'd be a billionaire.
Speaker BAs Kim was talking about and not doing live streams here today.
Speaker BProbably.
Speaker BOkay, let's talk about contract manufacturing next.
Speaker BKeith and Kim.
Speaker BNow folks, we got the smartest audience in all of global supply chain, right?
Speaker BSo 99.9999% of folks know this contract manufacturing primarily involves a company that hires another organization to produce parts or products.
Speaker BTwo questions for you, Keith.
Speaker BI'm going to start with the first one.
Speaker BWhat does the 2025 landscape look like for the contract manufacturing world?
Speaker DI think it's going to be very interesting because of the tariffs that we're going to see the US Contract manufacturing space be of interest again.
Speaker DAnd so I think that is a great opportunity for the domestic based contract manufacturers and for those countries that don't end up having tariffs.
Speaker DFor me specifically, I'm on the healthcare side and we're actually having a pretty good start to the year.
Speaker DCovid had really high demand in healthcare as you might imagine.
Speaker DThere were some win and some losers in that.
Speaker DBut then there was a kind of a destocking period in the supply chain and we're normalizing but also a bit of stagflation is occurring which can tend to be.
Speaker DWe may not be out purchasing a ton on the consumer side, but we take care of our health.
Speaker DAnd so we're seeing many of the major med device companies hitting off to the Year with a bang.
Speaker DSo I expect with some of this uncertainty there is still going to be a strong healthcare market throughout the rest of the year.
Speaker BYep.
Speaker BOkay, that's good news.
Speaker BI like rosy projections, especially for folks in the know like you, Keith.
Speaker BKim, what'd you hear there and what would you add?
Speaker BYou got your finger on the pulse of any contract manufacturing community members.
Speaker CI'm not huge into healthcare, obviously that's not my area of expertise.
Speaker CBut yes, we are seeing slowing in manufacturing, a slowing in orders because things are uncertain.
Speaker CRight.
Speaker CWe don't want to agree to a price and then it goes up 30% in two weeks or it goes down 30% in two weeks.
Speaker CAnd I've been taking a little time to look at, you know, what happened last week, but also what has been happening since January and February.
Speaker CRight.
Speaker CAnd if we take like the auto as an example and also aluminum steel, we put, you know, big tariffs on aluminum steel, 25 and 10% was a really big deal.
Speaker CBut how was that actually implemented?
Speaker CWell, we gave a pass for Canada and Mexico.
Speaker CWe finally gave up on that one.
Speaker CAnd what we actually implemented were actual TRQs or deterior freight quotas, which is you can still import at the current rate, but only up to a certain amount.
Speaker CSo how will we begin to implement all these new tariffs that we heard about last week?
Speaker CHow will they actually be implemented, I think is the big question and that will drive what people actually end up doing.
Speaker BKim, well said as always.
Speaker BAnd you know, I'll talk about a wish list really quick.
Speaker BI really wish we had more definition and clarity and certainty in the new policies with some longer term timeframes so we could digest everything that was taking place and be in a better position to, you know, mitigate.
Speaker BBecause that's, I mean, different things for all sorts of different companies based on a number of different factors.
Speaker BSo that's not what we have.
Speaker BWe're left maybe wishing and hoping that we see a flurry of deal making in the next few weeks.
Speaker BBut we'll see, we'll see.
Speaker BCam and Keith, my crystal ball has been broken for a long time.
Speaker CIt's been broken.
Speaker CAnd so when I talk to people in the industry right now, they're like, what do we do?
Speaker CAnd I think Keith is probably hearing a lot of the same thing is what do we do?
Speaker CWhat do we do?
Speaker CWhat do we do?
Speaker CAnd my answer has been wait 48 hours.
Speaker CLike wait and see what happens.
Speaker CDon't react quite yet.
Speaker CAnd I'm sure Keith is probably seeing something similar in his industry.
Speaker CAs well or people are starting to panic.
Speaker BWait and see, Keith.
Speaker BWait and see.
Speaker BYou know, taking a breath, huh?
Speaker DYeah, definitely.
Speaker DI mean, you see what happened with Vietnam as well, right?
Speaker DJust in within a matter of two days, all of a sudden they come to the table to negotiate and now we're, you know, holding back on tariffs there you talked about Mexico and Canada coming to the table and all of a sudden these things are being pulled back.
Speaker DIt seems like we're at least starting to see a little bit of a pattern.
Speaker DWhat we're trying to ach achieve here is let's get to the table and have a conversation.
Speaker DCan agree or disagree with the tactic, but that's what I feel the wait and see pattern is is will the other countries show up and negotiate or not.
Speaker DI guess I'm expecting if you don't, these tariffs are going to stick.
Speaker DIt's kind of where I'm heading with it.
Speaker BOur audience has heard me say this a thousand, maybe a million times now.
Speaker BThis too shall pass.
Speaker BIt may pass like a kidney stone, but this too shall pass.
Speaker BOkay, a couple quick comments before I pose a second question.
Speaker BLet's see.
Speaker BJeremy says, I'm certain US infrastructure needs some improvement.
Speaker BHouseholds as infrastructure.
Speaker BJeremy.
Speaker BThat's right.
Speaker BThat is right.
Speaker BLK says what Kim said.
Speaker BThat's right.
Speaker BSome sellers may be hesitant to sign long term contracts because our costs would go up as well and could possibly put them in the red.
Speaker BExcellent point.
Speaker BOkay, back to contract manufacturing.
Speaker BThis is a really important question, Keith, and I'm glad you're here as an expert to address for us because you know, companies are going through selection processes for no shortage of things including including new contract manufacturing partnerships.
Speaker BSo Keith, given all of your experience and expertise in this space, what's a couple of key considerations that business leaders should consider when selecting a new contract manufacturer?
Speaker DI think the first big one, Scott, is to consider capability.
Speaker DWhat is your current core competencies and is what you're trying to do or manufacture really within your core competencies?
Speaker DYou also need to understand where you are in your growth life cycle of a product.
Speaker DProduct.
Speaker DYou know, you're not wanting to bet the farm early on in a product and so it's easier to keep that variable cost.
Speaker DAnd likewise, as a product matures and starts to move on a decline, you don't want to have all the fixed costs associated to a mass production environment.
Speaker DAnd there's many contract manufacturers such as myself that as scale that we can absorb that fixed cost among many other customers that allows that decline for our customers.
Speaker DTo be a variable cost versus absorbing fixed costs through an aging product life cycle cycle.
Speaker BGood stuff.
Speaker BAnd I like the first one in particular, Kim, because it's so universal.
Speaker BSo universal.
Speaker BAnd kind of my spin on what he shared there is know thy business like thyself.
Speaker BYou know what, what's our core competencies?
Speaker BWhat are our objectives?
Speaker BWhat are we looking to specifically, you know, take beyond the four walls.
Speaker BBut what'd you hear, Kim, from Keith, or what would be your own suggestions?
Speaker CI think you know, Keith, talking about know your business and know your core competencies are going to be really key.
Speaker CAnd if you are a company that is a US Manufacturer or has product, product that's mostly made in the United States and you know, thusly qualifies for made in the United States, start leaning into that.
Speaker CStart advertising the fact.
Speaker CAnd it's not just the fact that your product's made in the United States.
Speaker CThat's great and you want to lean into that.
Speaker CBut also your supply chain should be pretty stable as well.
Speaker CYou're not going to have the disruptions that your competition may potentially have because you're relying on importing from another country.
Speaker CThe prices are going to go up and down also.
Speaker CJust and as we saw in Covid, you may simply just not be able to get the product.
Speaker CSo if you are a US Manufacturer and you are debt, definitely in a good position right now and you should lean into that, but also make sure that you lean into the products.
Speaker CSo, you know, I think a little bit of what Keith is trying to say is like don't go crazy and start trying to make, you know, stamped aluminum when your products have really been plastic and paper.
Speaker BExcellent, excellent points there, Kim, as usual.
Speaker BOkay, Keith and Kim, I wish we had a whole bunch more time on this Fine Monday morning.
Speaker BIt's April 7, 2025.
Speaker BAlready feels like we were just talking about the super bowl, right?
Speaker BAnd we blink.
Speaker BA couple months are passed.
Speaker BKeith, before we wrap with your segment here and really appreciate you joining us, I want to ask kind of a take a hard right turn, ask you something else because we get feedback all the time.
Speaker BEmail, social comments, you name it.
Speaker BFolks want to know how to move up that proverbial ladder and break into the C suite, be CEO of an organization, a manufacturer, you name it.
Speaker BSo what would be a piece of advice or two from you on those folks that want that upward mobility?
Speaker DI think certainly resiliency and tenacity.
Speaker DYou can't give up.
Speaker DYou just have to keep grinding it out throughout the years to move to that Direction in my case, or even I would call myself a bit entrepreneurial, buying my own business as well, that you need to take that risk too, right?
Speaker DSo you work and gain that experience over time.
Speaker DYou always find a way to say yes to get that experience.
Speaker DBut at some point you got to take that leap.
Speaker DAnd I find that I hear a lot of folks from an entrepreneurial standpoint are saying, hey, I'm going to put my hat in the ring on this thing, or I'm going to make a strong push to move into an executive role.
Speaker DIt's tend to be a bit nervous of what you have to lose more than what you have to gain.
Speaker DAnd I would say, you know, take that leap when it feels just a little bit uncomfortable.
Speaker BYes.
Speaker BThat's not million dollar, that's billion dollar advice, folks, from someone that has taken the risks, taken the leap.
Speaker BAnd like you said, I think the last part, Kim, first off, I love the resiliency and tenacity.
Speaker BThat's quite the duo.
Speaker BAnd if you can really lean in and develop those traits and what it means in your own personal leadership style, that's quite a duo.
Speaker BBut risk taking and taking the leap, when everything is not certain, you're going to still have some variables in the good old equation, but that's why it's called risk taking now.
Speaker BIt doesn't mean to go to Vegas, put all of your money on Red 19.
Speaker BObviously, that's not the kind of risk we're talking about.
Speaker BAlthough Red 19 delivers sometimes.
Speaker BBut, Kim, what'd you hear there?
Speaker BWhat advice would you offer?
Speaker BI mean, you've also obviously are a successful executive and entrepreneur.
Speaker BWhat would you offer them out there?
Speaker CYou know, the biggest thing and Keith mentioned this is saying, yes, I always preach and it's a lesson I learned the hard way.
Speaker CAnd we could probably do a whole podcast on this is that there is no no.
Speaker CThat's what I tell people all the time.
Speaker CYou cannot tell me no.
Speaker CYou can give me seven different answers of yes, but you cannot tell me no.
Speaker CAnd the answer can't be, you'll do this and you'll go to jail, but you can't tell me no.
Speaker CAnd so that is one.
Speaker CIf you want to grow, there is no, no.
Speaker CThe second one I see is always be in a place of learning.
Speaker CThe one thing that I see that executives do, the biggest mistake I see get consistently is they get that executive title and they shut it off because you're like, well, now I know everything.
Speaker CAnd they stop learning.
Speaker CAnd when you stop learning, you stop listening.
Speaker CWhen you stop listening, you stop growing.
Speaker CAnd when you stop growing, you can't grow a company if you're not growing yourself.
Speaker CThat's just the way it happens.
Speaker CSo continue to learn.
Speaker CI always tell people and kindness, we forget to be kind.
Speaker CThe higher we get up there.
Speaker CWe start barking orders and calling people on Saturday morning.
Speaker CAnd I need this and I need this, that.
Speaker CAnd you know, we forget that all of these people who we are now responsible for as a leader, you become responsible for those humans and for those souls.
Speaker CAnd you need to be kind to them and you need to help them.
Speaker BThat's your job, Kim.
Speaker BExcellent.
Speaker BAnd you know, Kim and Keith, you know, one of the themes of this whole conversation here today has been the disruption and the pressure and the concern out there, whether it's tied to business or if it's tied to, you know, personal households and families.
Speaker BAnd I think talking about leadership, that's exactly when your team needs you the most.
Speaker BAnd being empathetic to what they're feeling and the pressures are feeling, I think that's really, really important to call out.
Speaker BSo, Keith, I don't see you calling anybody barking anything on a Saturday morning.
Speaker BI don't get that from you.
Speaker DYeah, that's not how we roll.
Speaker DOur ultimate core value is we care more, so we care more about ourselves first.
Speaker DVery similar what Kim was saying.
Speaker DYou got to put it into yourself.
Speaker DYou then poured into the folks that we work with.
Speaker DThat pours into our customers, which ultimately into a patients and consumers we serve.
Speaker BExcellent point.
Speaker BAnd Kim, I've got to work better on not slacking anybody on the weekend, weekends.
Speaker CYou guys are weekend workers.
Speaker BI will say that guilty is charged.
Speaker BBut Kim and Keith, what a great conversation.
Speaker BKeith, really have enjoyed what you shared here today and of course, always enjoy Kim's commentary.
Speaker BKeith, before we let you go, how can folks connect with you and the Vanko Products team?
Speaker DYeah, it's www.vanco.com.
Speaker Dcertainly look up Keith Smith on LinkedIn.
Speaker DAnd then for my personal journey, I do a fair amount of entrepreneurial coaching.
Speaker DThat's Keith Smith.
Speaker BOkay, outstanding.
Speaker BLearn something new every day, folks.
Speaker BWe're dropping several of those links there right in the chat, including Vanko.com you want to click away from learning a lot more about Keith and his team.
Speaker BKeith Smith, president CEO with Vanko Products, thanks so much for being here.
Speaker DMy pleasure.
Speaker BAnd we will see you soon.
Speaker BHave a great week.
Speaker BWe're bring you back and have a update soon.
Speaker BHave a great week.
Speaker DGreat.
Speaker DYou too.
Speaker BOh, Kim, man, that was a great segment.
Speaker BIt we got so many ideas for new shows and we got tons of comments here.
Speaker CLet's see the comments.
Speaker CLike why we were going.
Speaker CLike I was trying, I was like, you're gonna have to stop reading those.
Speaker CBecause there I was getting a little, I was getting a little fired up.
Speaker CBut like, wait a minute, there was some argument in there about firefighting versus not fire.
Speaker CLike, I was like, oh, it's a hot topic.
Speaker BIt is a hot topic.
Speaker BNo pun intended.
Speaker BAll right, so we dropped Keith's on LinkedIn, his profile.
Speaker BSo y'all check that out.
Speaker BHey, Tomcat, great to see see you.
Speaker BNow, you know, you made an appearance.
Speaker BYou hold down the fort force over on Twitch.
Speaker BNow you got to bring a supply chain.
Speaker BHa.
Speaker BCoupe.
Speaker BWe'll see if Tomcat can do that before we leave.
Speaker BAll right, let me go back to some of these comments.
Speaker BLarry Klein says that's correct.
Speaker BLeaders aren't bosses.
Speaker BOr at least I might put a spin on that.
Speaker BKim, I love working for leaders that don't approach their role as a boss.
Speaker BWould you agree with that?
Speaker CI would agree.
Speaker CAnd I hate to quote Carnegie, I don't know why I hate to quote him, but he had a thing on.
Speaker CI mean, I guess because he was like back in the day that was all the leadership coaching you could get, right?
Speaker CAnd he had a quote that was, it is easier to pull a string than push a string.
Speaker CAnd when that was taught to me when I was in my early 20s, I didn't really get that right.
Speaker CI was like, okay, whatever, right strings.
Speaker CBut I get it now and that it is so much easier to lead by example and pull your team with you than to push people.
Speaker CAnd you know, I've done a lot of leadership and like big scale and change leadership and building big scale projects.
Speaker CAnd if your people aren't happy, you are never going to be successful.
Speaker CSuccessful, yes.
Speaker CI've seen it happen a million times.
Speaker CAnd the companies will get to a certain level of success and they just cannot push past it.
Speaker CAnd it's because of leadership almost always.
Speaker BYeah, I'm throwing down the leadership gauntlet here today.
Speaker BWe should all take note.
Speaker BAnd maybe I think now is a great time to do a kind of some self reflection and you know, self inventory of where we are as leaders right now, especially in really challenging times.
Speaker BBecause, Kim, I'm about to get one of your key takeaways from Keith's appearance here today.
Speaker BBut you got me thinking out loud here.
Speaker BIt's pretty easy to be an effective leader when times are good, right?
Speaker BAnd all those Upswings and coming off big successes.
Speaker BBut, man, when things get tough and whether that's, you know, kind of inside the four walls or if it's just market conditions or whatever it is, that's when the knees get wobbly and sometimes you lose your finger on the pulse of your own sense of confidence and where that comes from.
Speaker BRight, so, Kim, excellent, excellent points here today.
Speaker BSo, all right, so Keith dropped a ton, ton of good stuff here today.
Speaker BBefore we wrap here, Kim, give me one of your favorite takeaways from Keith Smith's appearance here.
Speaker CHe's talked about manufacturing.
Speaker CI think the biggest piece that Keith talked about, and we didn't really highlight it, it was a little bit subtle.
Speaker CSo I want to really bring it to the forefront is knowing your business, knowing your product, knowing what you manufacture, knowing what your sweet spot is and really sticking with that.
Speaker CAnd he talked about it just a little bit.
Speaker CBut Keith is massively successful in what he does.
Speaker CHe's a very, very successful entrepreneur and business leader.
Speaker CAnd I think that is the key, is that he knows his business, he knows what he's doing, and he focuses on that.
Speaker BAnd it's easy to fool ourselves there, Kim.
Speaker BIt's easy to fool ourselves into what our organizational strengths are, core capabilities.
Speaker BAnd we got to be really frank and honest with ourselves and with our teams.
Speaker BRight?
Speaker CWhat I see a lot, because I work with quite a few startups and that are, you know, trying to accelerate very quickly.
Speaker CYou know, they need a little nitrous, as I call it, they lose focus, and what happens is they get excited, they have some success, and then they're like, oh, my God, we're gonna sell skis.
Speaker CI'm like, why you sell steak?
Speaker CWhy wouldn't it be so amazing if our logo was on some skis and people could see it and that'd be free advertising and this, that, and the other.
Speaker CI'm like, well, we are not in ski manufacturing.
Speaker CWe are not in ski anything.
Speaker CBut what happens is they get excited and they have some success, and they think that it will translate to whatever they see next.
Speaker CAnd that doesn't always happen happen.
Speaker CAnd that is where I see a lot of startups fail is because they lost focus on what they're good at.
Speaker BExcellent point there, Kim.
Speaker BI feel that one in my bones.
Speaker BAll right, so let's do this.
Speaker BOne other thing, Kim, that I enjoyed.
Speaker BI think I've got a graphic here, and we're going to drop the link to this chat here.
Speaker BSo Kim loved our chat with Jeffrey.
Speaker BShe who serves as CEO of DeMarco Express Group.
Speaker BNow, when it came to customs and trade in this conversation, I had no idea that this is where you began your career back in the day.
Speaker BAnd I really enjoyed your perspective at one point in time during this conversation here, I wouldn't got some popcorn, a diet Coke and just watched the ping pong ball between you and Jeffrey.
Speaker BSo the interesting question here, Kim, that we're not gonna have enough time.
Speaker BSo it's kind of an unfair question.
Speaker BBut I want you to weigh in here.
Speaker BSo given that experience in your career, right, your experience in trade and customs and that kind of stuff, how does that shape your view?
Speaker BView on what we're seeing right now?
Speaker BAs you know, we've talked about this massive change in tariff policies from the US Side.
Speaker CWe talked about this a little bit before the show.
Speaker CAnd you know, I have my old woman attitude which has been there, done that a little bit.
Speaker CIf you went through Y2K as a broker, this is like snooze fest.
Speaker CYou're like whatever until they're breaking out the carbon paper and the typewriters, I think we're good.
Speaker CNo, but on all seriousness, you know, the advice that I've been giving to a lot of people is don't react too quickly.
Speaker CThis can all change in 48 hours.
Speaker CI talked a little bit earlier about how we've actually seen things implemented.
Speaker CThe steel and aluminum tariffs and also the auto parts and auto as an example.
Speaker CThere was a lot of media and bluster around it.
Speaker CBut actually what got implemented wasn't that big of a deal.
Speaker CSo wait and see.
Speaker CIt's very scary.
Speaker CIt's going to take at least three to five years for us to pick up manufacturing in the United States at the level that we would need if we completely cut off China.
Speaker CSo I think we're going to be in for a bumpy ride if we stay on this course.
Speaker BUndoubtedly.
Speaker BAnd Kim, I might add to what you're sharing there, folks, if anyone out there tells you exactly what you need to do right now at 12:53pm Eastern Time on April 7, you better run the other direction as fast.
Speaker BIf you run slow.
Speaker CSend me that money.
Speaker BOh my gosh.
Speaker BIt is interesting times and that's putting it very mildly.
Speaker BOkay, folks, we dropped the link to that great episode.
Speaker BCheck it out.
Speaker BYou're going to see a whole new version.
Speaker BI think of Kim Reuter and maybe you're like me, I didn't fully appreciate that component of our journey.
Speaker BSo check out that episode there.
Speaker BSo Kim, we have got national supply chain Day coming up on April 29th.
Speaker BNow, we would invite all of y'all to come celebrate.
Speaker BMe and Mary Kate Love are going to be hosting a live stream on that day.
Speaker BApril 29th is Tuesday, but it's going to be like a supply chain variety show.
Speaker BWe're still finalizing the guest list, but we really want to, number one, celebrate the people that make supply chains move forward every single day.
Speaker BThat's the overarching goal.
Speaker BBut we want to have conversations focused on transportation, on reverse logistics, on manufacturing, kind of all the different sectors that make up the holistic supply chain.
Speaker BSo folks, if you can't join us, which I know all of y'all are busy, April 29th at 12 noon, if you can't join us, that's no problem.
Speaker BWe just challenge you to celebrate, especially the people in supply chain in your own neck of the woods.
Speaker BAnd we're dropping a link so folks can join us.
Speaker BIt's right there, folks.
Speaker BOne click away from learning a whole bunch more about National Supply Chain Day.
Speaker BAnd especially the people, people that make up this industry, they need their own month.
Speaker BHuh?
Speaker CI mean, we take six months would be ideal, but a month just to get a day.
Speaker CAnd I think someone made a comment in here that it's truly thankless.
Speaker CWe did talk about that.
Speaker CTomcat, like supply chain is truly a thankless job.
Speaker BSo true.
Speaker CWe are the reason why there is food on the shelf when you go in the grocery store.
Speaker BYeah, no doubt.
Speaker BAnd we take it for granted.
Speaker BAll of us do take it for granted.
Speaker BOkay.
Speaker BWhat an outstanding addition.
Speaker BWide ranging edition of the Buzz, folks.
Speaker BThere's a whole bunch more.
Speaker BFirst off, wherever you your organization is, you know, I know it's a tough time for a lot of folks.
Speaker BThere's a lot of uncertainty.
Speaker BThere's a lot of concern professionally and personally.
Speaker BAnd you know, the markets are going crazy and all that.
Speaker BHold the faith.
Speaker BWe're going to get through all of this.
Speaker BWe're going to gain some more certainty.
Speaker BIt's not going to be easy, but I am practically optimistic that going to get through all of this and be in a much better spot in the weeks and months ahead.
Speaker BSo Kim Reuter, always a pleasure.
Speaker BThanks for joining.
Speaker BAppreciate all of your perspective here today.
Speaker BKim, do you share that practical opportunity?
Speaker COptimism, yes.
Speaker CKind of.
Speaker BYeah.
Speaker BHey, we'll take it.
Speaker CWe're not going to turn on manufacturing in the United States in six months.
Speaker CLike it's just not going to happen.
Speaker BI'm with you.
Speaker BI'm with you.
Speaker BAnd you know, we need a healthy dose of skepticism and practicality.
Speaker BOr I guess, better put, it's called pragmatic thinking.
Speaker BBut we really need that, right?
Speaker BReally need that.
Speaker BSo we'll see how it all plays out.
Speaker BBig thanks to Keith Smith.
Speaker BHey, Keith did a great job.
Speaker BOf course, Keith is with Thon Co Products, folks.
Speaker BConnect with Keith.
Speaker BYou'll enjoy that.
Speaker BI really enjoyed the pre show and the real show, so to speak, here today.
Speaker BBig thanks to Amanda and Trisha behind the scenes helping to make production happen.
Speaker BMost importantly, big thanks to all of our global audience for being here with us.
Speaker BI know we couldn't hit everybody's comment and questions and whatnot, but really appreciate what you do.
Speaker BSafe travels to all of y'all.
Speaker BAnd you've got homework because Keith and Kim brought it here today.
Speaker BYou got to take one thing they shared, put it into practice, share it with the team.
Speaker BBecause all about deeds, not words, right?
Speaker BWith all that said, on behalf of the entire Supply Chain now team, Scott Luden challenge.
Speaker BYou do good, get forward, be the change that's needed.
Speaker BAnd we'll see you next time right back here on Supply Chain Now.
Speaker BThanks everybody.
Speaker AJoin the Supply Chain now community.
Speaker AFor more Supply chain perspectives, news and innovation, check out supply chain now.com subscribe to Supply Chain now on YouTube and follow and listen to Supply Chain now wherever you get your podcasts.