MES, Inc. delivers complete supply chain management solutions that allow North American OEMs (Original Equipment Manufacturers) to outsource the entire manufacturing process. The Columbus, Ohio-based business maintains offices in China, India, and Mexico, giving the company easy access to high quality manufacturers.
MES Inc.’s services have become more valuable than ever as mass customization sweeps through the manufacturing world. “Mass customization has been an irreversible trend across most of the industries,” says MES President and founder Hiten Shah. “Most of the OEMs in construction, trucking, agriculture and automotive industries have had to come up with an explosion of new products and product versions,” usually referred to as ‘long tail’ products. “This complexity has led to supply chain directors struggling with a mix of components which have short life cycle, lower volumes and unpredictable demand patterns.”
MES provides supply chain solutions for this complex mix of components, which include castings, machined parts, forgings, plastic, rubber parts and small sub-assemblies. “We reduce our customers’ cost, time-to-market, quality and inventory levels for this high-mix variety of products and components,” Mr. Shah reports. “Normally, with our help, our customers will reduce their in-house inventory from 60 plus days down to three days while meeting 30 to 50 percent spike demands for two consecutive months.”
MES sources manufactured components from all around the globe, so the team can choose the best product but also the most suited supplier for a specific customer. “We are not locked into one country, manufacturer or supplier. It is precisely this flexibility that makes us very successful. We can buy from any supplier globally.” In addition, the team can utilize MES warehouses throughout North America to ensure speedy, convenient service. “Our goal is always to be within three days of our customers.”
The company competes against customers’ or suppliers’ own supply chain processes and initiatives, as well as against domestic manufacturers. “Apart from our customers and suppliers, the breadth of our competition comes from brokers who do not provide the full spectrum of supply chain services such as supplier selection, quality management, warehousing, inventory management, and JIT (Just in Time) shipments,” says Mr. Shah.
Mr. Shah credits several factors with giving MES the ability to outshine the competition. “Being flexible, being nimble and focused on [the] customer has allowed us to grow fast and have fun along the way,” he says. “The satisfaction of us growing continuously while improving our key metrics of customer satisfaction, on-time delivery, quality ppm (parts per million rejects) levels and inventory levels is very gratifying. It inspires us to continuously get better and that sets us apart from our competitors.”
The company’s story began in 2002, when Mr. Shah quit his job to become an independent sales representative. His big break came in 2006, when he was visiting family in India. A customer was considering buying products from India, so he asked Mr. Shah to visit a few casting foundries. This jump-started a new business model for Mr. Shah and, within months, customers began to use him as an intermediary to source their components.
But this was only the beginning. Customers also needed more robust supply chain and warehousing solutions. Mr. Shah responded to this demand by hiring engineers in India and China and partnering with a warehouse in Ohio. It was not all smooth sailing, however; the strategic growth required serious risk. Mr. Shah had to get a line of credit on his new house to fund the first few years of inventory and in 2009, during the global financial crisis, the bank canceled his line of credit. Undeterred by the recession, Mr. Shah resorted to credit cards to keep the business running.
Racking up debt to secure inventory was not an easy decision. Growing up in Mumbai, Mr. Shah watched his father suffer harassment at the hands of lenders when the family business failed. As an adult, he was determined to earn financial independence and success. This motivated him to pursue a career in business after he earned a degree in engineering.
By 2011, Mr. Shah had managed to secure enough orders to receive another line of credit from the bank. While difficult, those lean years taught the entrepreneur valuable lessons on inventory management, giving him the ability to build an efficient supply chain organization “with deep analytics and processes in place.” Today, those lessons continue to be a strong foundation for MES—and continue to benefit customers.
Another lesson that Mr. Shah learned while he grew the business was the power of perseverance. For example, he began wooing a large industrial lighting company in 2009—and he kept at it for the next three years. Finally, in 2012, the company came on board when the director of sourcing called Mr. Shah and exclaimed, “you are one of the most persistent SOBs I have ever worked with!”
Mr. Shah took another risk in 2013, when one of MES’ biggest customers moved its factory from Indiana to Mexico. Instead of losing this business, Mr. Shah launched a new branch in Monterrey, Mexico. The decision turned out to be a huge boon. “Mexico has grown to almost half of our business in the last three years. We have seen phenomenal growth in that market.”
MES values its employees and works to promote a positive culture that encourages success and makes individuals feel valued. For instance, the company has monthly lunches where each team’s performance is reviewed and employee birthdays are celebrated. Companywide events are diverse and frequent, and include the celebration of everything from Christmas and Thanksgiving to Chinese New Year, the Dragon Boat Festival, Diwali, the Day of the Dead, and Halloween. Over half of MES employees enjoy the perk of global travel, and a number of company initiatives benefit the greater community as well as individual employees. For instance, in 2016, MES put $500 toward the charity of each employee’s choice.
The team’s diversity efforts earned an award from Columbus Business First. The news organization recognized MES in the Outstanding Diverse Organization category, which honors individuals, companies and organizations that promote diversity throughout the workplace.
In addition to being a minority-owned business, MES naturally embraces diversity as a result of its global presence. “We are in an incredible position,” Mr. Shah says. “[We are] a group of 100 people and only 35 are in the U.S. We have 20 people in Mexico, we have 30 in China, another 15 in India, a few in Vietnam. So just by our focusing on the mission we have morphed into a very diverse organization.”
Mr. Shah won a Smart 50 Award in 2015 and again in 2016. The award recognizes the region’s top executives and their commitment to innovation, impact, and sustainability. “For years, I always put more onus on quantifiable awards, such as Inc.500 [and] Fast 50, but as we have grown, I have realized that much of our work cannot be graphed in excel spreadsheets. Our culture, quality of our people, strength and depth of our IT systems, focus on data, diversity of our people, global footprint, transparency in sharing key metrics across our teams – all of these cannot be graphed. But there are many awards such as Best Place To Work, Innovative Companies, Smart 50 and others [that] can attest to our qualitative success. This is the reason we applied and this is the reason we take particular pride in winning these awards.”
The company’s technological focus is clearly reflected by the win. “Smart 50 is about companies that have smart and innovative systems and processes, that operate in smart environments, that have smart people,” Mr. Shah says. “We think for a small-sized company we have some very, very nimble platforms [and] innovations.”
For instance, the team utilizes a smartphone app that can track products all over the world. “Our engineers can use [that] to report on a daily basis from the factory. So a large company in Cincinnati doesn’t have as much access to what is going on in the factory 100 miles away as we do thousands of miles away.” The team reports every day on quality, productivity, supply chain issues, and more to stay ahead of the game.
MES’ next step is global expansion. “Our plan is to double in size in the next three years,” Mr. Shah says. The company is already headed in that direction. Over the past year, the number of employees jumped from 69 to 110. “And all of these people are here basically to support future growth—people growth, customer growth, location growth. And that is all tied in with very strong IT systems. I think overall that is really a recipe for success.”