the Lid Off
The company’s sales of high-value chemicals, laboratory supplies and equipment were constrained
by an inefficient order-entry and processing system. It needed a new sourcing solution for its
upstream supply chain.
s there anything more frustrating for a
supplier than the inability to handle
success? It’s the only thing worse than
having no business at all.
Spectrum Chemicals and Laboratory Products sells a wide range of chemicals, lab supplies and equipment related to
the making of pharmaceutical, personal
care, cosmetic and food items. Universities,
pharma companies and research labs make
up the bulk of its customer base.
It’s a complex operation by any measure. The company manufactures and distributes some 250,000 unique SKUs out of
two manufacturing facilities, in Los Angeles,
Calif., and the New Brunswick, N.J., headquarters. Items are made to exacting specifications and are strictly monitored by the
U.S. Food and Drug Administration.
Spectrum has enjoyed a great deal of
success in its 30-plus years of existence—
too much, as it turned out. Thanks to a complex and highly manual fulfillment operation, its customer-service staff was limited to
handling around 40 orders a day per person. An entire team of people was concerned solely with entering faxed and
e-mailed orders into the enterprise resource
planning system. Under that setup, there
were no shortcuts to processing the shipment of sensitive, tightly regulated chemicals to destinations around the world.
Complications ensue from the wide variety of chemicals, which might be available in
up to a dozen different grades. If a customer
fails to specify the correct item number, it’s up
to Spectrum to steer it in the right direction.
The extended interaction with accounts, necessary though it might have been, was slowing down the process and limiting the
number of orders that could be addressed in
a manually driven environment.
“We knew that as we were growing, we
had to streamline the order-entry process,”
says director of e-business Larry Hilton. At
the same time, “we needed to make sure
that all of the paperwork was correct.”
Spectrum’s first thought was to integrate
its business-to-business communications and
electronic data interchange (EDI) messaging
with the help of internal resources. That idea
was quickly rejected. The company didn’t
want to take on the cost of maintaining its
own value-added network (VAN), an effort
that would have necessitated the purchase of
large blocks of data. What’s more, a home-
grown system was unlikely to scale easily in
line with future growth. So Spectrum began
searching for an external partner.
Spectrum Chooses Hubspan
Hubspan, a vendor of B2B integration tech-
nology in the cloud, was the company’s ulti-
mate choice. It was familiar to Spectrum
through an existing partnership with
SciQuest, a provider of electronic procure-
ment software and services. “We did a lot of
business with universities associated with
that solution,” says Hilton. “[Hubspan]
became a natural to consider.”
Jim Cantrell, director of channel pro-
grams with Hubspan, says SciQuest serves
several hundred higher-education organiza-
tions. Hubspan acts as an integrator
between the SciQuest platform and the
spend-management programs of its users,
including Spectrum. It also works with a
number of other e-procurement offerings.
Hubspan interfaces directly with Spectrum’s internal ERP system for all relevant
order-to-cash transactions. The vendor links
Spectrum with its universe of trading partners without the need for the latter to bring
on additional IT staff.