The company that produces the ubiquitous Clipsal switch, Schneider Electric, is able to remain competitive in Australia by combining highly productive practices, being very responsive to customers, and a strong brand. Brent Balinski spoke to the company’s David Gardner.
“We have approximately 50 trucks leaving the facilities every day; around about 75,000 movements out the door,” explained Gardner, head of the Clipsal and Schneider Electric Partner Business.
“Per month, products go out to over 1,000 distributors that we service here in Australia.”
The Clipsal brand’s reach in Australia is huge, covering customers’ electrical needs from the power station to the power point, as the company likes to put it.
Though it was sold for $750 million to French energy management giant Schneider in 2003, ending four generations of ownership by the Gerard family, Clipsal has remained both a hugely important brand in South Australia – continuing to sponsor Adelaide’s premier motor sports contest, the Clipsal 500 – and a reminder that, done right, high-volume manufacturing in Australia can be successful.
Gardner joined Schneider over two decades ago, and has been in his current role for 18 months, overseeing the “leveraging of two very strong brands” in the market.
“We make sure people understand that, quite uniquely for us in the Schneider world in this part of the world, we’re actually keeping and maintaining and are keen to in the future keep and maintain this Clipsal brand,” he told Manufacturers’ Monthly.
The headquarters and main manufacturing site for the Clipsal brand, established by Alfred Gerard in 1920 and named for the “clips all” metal conduit attachment he invented, is at Gepps Cross, northern Adelaide.
The three-shifts-a-day, 30,000 square metre facility was opened in 2009, after a $35 million refurbishment by Schneider. It replaced the company’s Bowden site, which had been Clipsal’s home since 1936.
The Gepps Cross site features 25,000 square metres of combined logistics and manufacturing space, with small, highly flexible, multi-skilled work cells able to produce in large quantities, but also able to respond quickly to custom orders and help these turn over in less than a day.
Gardner credits strict adherence to Schneider Production System with enabling the rapid turnaround, with strict attention on everything from a cut-off time on entering the order to getting it out the door.
“Provided that order’s entered that day we are really talking about next-day dispatch,” said Gardner.
“That would come, I’m talking the volume part of the business, from our finished goods stock, which would need to be rapidly replenished.”
“We have fantastic standards around kanban supply techniques to the workshop floor. We are manufacturing in batches where we can keep the raw materials and finished goods at minimum levels, but at the same time meeting the on-time delivery commitments that we do have to our customers.” He mentioned that in the last month, the Gepps Cross facility achieved its – strictly measured – personal best for on-time dispatch of 95.3 per cent.On the topic of speed, a decisive advantage to keeping the Australian customer base happy is keeping Clipsal’s manufacturing in Australia.
“It’s really one of the strengths we have with local manufacturing, we can very quickly manufacture and adapt from base components, specific [items] that the customer may need, for example an industrial plug or socket,” said Gardner.
The labour component of what Clipsal produces has been reported as up to 40 per cent of total costs. Cutting this by manufacturing overseas would also mean much longer lead times for Australian customers.
“But even outside of Adelaide we want people to understand that we are part of a global organisation, and in fact we manufacture at 250 sites in more than 100 countries,” said Gardner.
Schneider currently employs nearly 1,100 at the Gepps Cross site, made up of just under half of these in manufacturing and logistics area.As far as the future is concerned, Clipsal believes that the companies in SA and the rest of Australia best placed to prosper will be the ones who are looking to the future and where opportunities are likely to emerge and grow.“
Certainly a very big [trend] is around digitisation, for example,” Gardner said.
“This new generation coming through are certainly demanding immediate availability of information, remote control, for example of products; connectivity of product within their home or their workplace or other environment. Certainly that’s been the case in the industry for a long time.
“But I think now with new technology being more readily available for people and them being more adaptive to using it, it’s up to us to find those opportunities in the market.”
Manufacturers' Monthly visited Schneider's Gepps Cross factory on the Around Our State tour as a guest of Brand South Australia.