Propeller GB, a world-class provider of inventory management systems, employing innovative technology developed in-house, has secured an EU-funded £¾ million investment to fuel substantial business expansion, with a goal of more than doubling turnover by 2015. Formed in 2001 and currently celebrating its 10th anniversary, the Peterlee-based company will channel the funds into rolling out further technological advances, the accelerated production of ‘intelligent’ storeroom equipment and building its customer base nationwide, including exploring possible partnerships with established distributors. Part of a North East Growth Fund for businesses with strong growth potential, to facilitate a step-change in their expansion plans, the investment package is being managed by FW Capital, who carried out extensive due diligence and were excited by the scope for Propeller’s class-leading technology.
Jointly founded by CEO Tony Goodwin, previously a cost consultant delivering inventory management solutions, and MD Carl Brookes, who has a background in industrial distribution, Propeller has its main business focus on the management, procurement and supply of MRO (maintenance, repair and operating) spares and consumables, looking to improve customers’ productivity, reduce spend in this area and tighten control over storeroom items. Its services are particularly targeted at the automotive, aerospace, power generation, pharmaceutical, food processing and defence sectors.
MRO spares are defined as components and consumables used for the day-to-day repair and maintenance of production lines and equipment, forming part of the indirect material spend for any large manufacturer or processor. Typically, MRO inventory can be between 15% and 20% of total enterprise spend, yet accounts for up to 80% of procurement department workload, making this a key cost saving opportunity, especially as internal transaction costs usually exceed the product purchase price.
Moreover, inventory is frequently distributed across multiple-stores or site locations, leading to duplication of parts and wastage of floorspace and working capital; conversely, discrepancies between physical parts on the shelves and system records can result in stockouts and consequent downtime. Too often, MRO storerooms are also ‘free for all’ facilities, where staff can take out inventory without proper controls and are not fully accountable for their usage.
To combat these MRO management problems, Propeller offers a fully integrated ‘holistic’ service, which takes care of the customer’s indirect parts from sourcing and supply, through to automated control of inventory on site. Employing its advanced storeroom technology, it gives clients complete visibility of MRO purchasing and stock, saving them time, money and internal resources, as well as maximising staff access to urgently-needed spares and consumables.
At the heart of Propeller’s business solution are two ‘intelligent’ inventory management systems. Pro-Vyda is a point-of-use parts ‘vending’ unit, which provides authorised-only access to inventory by means of swipe card, key fob or biometrics, close to the production line or other workplace. Pro-Pod provides the ultimate management of central engineering and maintenance stores, employing the latest radio frequency identification technology, which automatically captures stock movements without the need to physically book out items.
Propeller’s automated equipment means that MRO inventory data can be interrogated remotely from a desktop PC, spares can be rapidly located and retrieved through a touch-screen search, and full stock-checks are completed within hours, compared with the usual days.
One of the world’s leading automotive suppliers, braking and steering systems specialist TRW, employs Propeller’s service at three of its UK sites, including the very first Pro-Vyda installation, and characterises the large, progressive manufacturing organisations that the Peterlee company targets. Other clients include global defence and security group, BAE Systems, precision formed components company Presspart, bearings and steering systems supplier NSK, global batteries brand Rayovac, food ingredients blender Moguntia, fast-growing savoury snacks company Intermark, and internationally renowned TV and electronics brand, Sony. Working with these and other customers to increase their profitability, Propeller has achieved MRO spend reductions up to 40% and six-figure savings on obsolete parts and indirect material costs.
"MRO spares and consumables are the oil that keep factories moving, but it’s well established that indirect material procurement of this type is complex, time-consuming and, inevitably, an activity that is not regarded as a core business function," says Tony Goodwin. "Backed by ten years’ experience of providing some of the largest and most demanding manufacturers in the UK with MRO services, we have the know-how and technology to deliver a highly proficient sourcing and supply solution, enabling our clients to focus on what they do best.
"Now with this fresh injection of capital, we shall be able to explore new market opportunities, develop even more innovative technology and push ahead with our expansion plans into Europe," he concludes.