By Robert Celaschi for Business First
Something as simple as a bottle of hand lotion can pose a big logistical hurdle. One company makes the lotion. Another company makes the bottle. A third company makes the pump. A fourth company fills the bottle. A fifth makes the packaging. A sixth packs the bottles.
One way to avoid the time and expense of shipping the pieces around the country – or even around the world – is to put the companies right next to one another. That’s what the city of New Albany has done with its business park dedicated to the personal care and beauty supply chain.
Accel Inc., a longtime supplier to Limited Brands Inc., was the first company to move into the Personal Care and Beauty Campus last year. The contract packaging company was followed this year by eight more tenants – makers of candles, cleaning products, fragrances, bottles and packaging.
Altogether the nine companies, many from out of state, fill more than 1.4 million square feet, brought more than 1,500 jobs to New Albany and have invested about $144 million in the park that allows for production, packaging, labeling and distribution all in one spot.
In the case of one company, home-fragrance manufacturer Jeyes, it meant moving 150 jobs from Mexico to New Albany. The companies’ proximity to each other has several advantages, including allowing them to cut down on transportation costs and packaging waste.
The site is part of New Albany’s sprawling, 3,000-acre business park, which has been under development since 1998. The specific site sits just across Beech Road from Abercrombie & Fitch’s home office. The New Albany Co. owns the land. Columbus developer Pizzuti put up some of the buildings.
up close and personal
Clustering is all about speed to market. Instead of shipping a bottle across the country to be filled, now it only needs to travel across the street.
“The automotive industry has done this for years,” said Jennifer Chrysler, New Albany’s director of community development. “A lot of suppliers are located in Marysville. It’s cheaper and faster to supply parts to Honda in their own back yard.”
Central Ohio’s logistical strengths include being within 500 miles of half the country’s population. New Albany’s strengths include having enough undeveloped land so that the buildings could be clustered around a single cul-de-sac.
For companies that already do business with one another in the park, proximity becomes a selling point to introduce the setup to other clients. Each becomes a reference for the others.
Not all of the companies do business with one another, but having that option for integration opens the door.
Alene Candles, a New Hampshire manufacturer with a plant in the business park, doesn’t have any customers or suppliers among its New Albany neighbors. But it is trying to get one of them to make a piece of equipment that would dramatically cut costs, said President Rod Harl.
But proximity is only part of the equation.
“I believe what we have done here in New Albany is much greater than that,” said David Abraham, CEO of Accel.
He has known and done business with some of his neighbor companies for 15 years. They meet every month to talk about ways to improve performance.
“It’s got to be that mindset that we are here to do something different,” he said. “It starts with trust and integrity of the companies that are willing to work with each other.”
Accel, for example, can work on new packaging that costs a bit less, fits a bit better in a carton, and stands up to the jostling of shipping. The people who make the product that goes in the package – say, a bottle – are right there in the business park to provide input.
“Now these companies can go to other vendors that each has, and figure how they can improve service to other customers together,” Chrysler said.
It’s an opportunity to grow, not merely sustain, each company, she said.
broadening the base
The New Albany Co. and City of New Albany drove the plans to create a Beauty and Personal Care Innovation Campus within the New Albany Business Park, which has more than 4 million square feet developed.
The beauty campus required $28 million in infrastructure improvements to get it ready. New Albany put in the roads, water lines, sewers and basic utilities so the properties would be shovel ready. The investment also included fiber-optic lines.
“We had $9 million of infrastructure in the ground in nine months,” Chrysler said. “We had road, water and sewer going in at the same time buildings were coming out of the ground.”
New Albany has been trying to balance and diversify its economic base and one of the weak spots was manufacturing and distribution, she said. The northeast quadrant of Columbus is home to Limited Brands, parent of Bath & Body Works and Victoria’s Secret.
The first company New Albany approached was Accel.
“One of their largest customers is Bath and Body Works. As they started to look for space and the New Albany business park emerged as one of the top locations, they started partnering with several other companies they work with,” she said.
Accel was founded in 1995 and served Bath & Body Works out of a 1,200-square-foot facility. It grew rapidly and was based in a 300,000-square-foot Lewis Center facility before moving to New Albany in June 2011. It specializes in custom packaging for retailers and pharmaceutical companies, including design, component sourcing, assembly and shipment. At its peak, Accel has 1,000 workers, including temporary and seasonal employees.
The cooperative mindset at the beauty campus includes having the right labor at the right time. So Accel started its own temporary employment agency in March.
“Our temp agency is all about complementing,” Abraham said.
Instead of someone finding sporadic work in nine different spots around the region, it’s at least theoretically possible to get 12 months of work in the same business park.
Right now the agency is supplying five of the nine companies and cross-training the temps so they could work at any company in the park.
“It’s an incubator of a career path,” Abraham said.