Classic Markets, Corp.

Supply Chain

by:Stephanie Garner

Eric BrubakerRobert WilsonNeal BelcherTara Godfrey

Binney & Smith

Parent company of Crayola Founded in 1885 First box of crayons produced in1903 Production to date of crayons has

exceeded 100billion

Also owns Hallmark, Portfolio, Silly Putty and Revell-Monogram.

Products by Crayola

Crayons Markers Clay Chalk Paint Colored

Pencils

Play-Doh Water

Colors Stickers Silly Putty School Kits Stamps

Warehouse

Classic Markets, Corp

Classic Markets, Corp

Supply Chain for Classic Markets, Corp

Information Flow

Product Flow

Step 1: Crayola FactoryHow Crayons are Made

STEP 1:Wax &Pigment Crayola Crayons are made from two basic ingredients:paraffin wax and pigment. Heated tanks store the wax. Pre-measured pigments are added to the waxand mixed.

STEP 2: Flat Bed MoldingThe paraffin wax and powdered pigment mixture are poured into the crayon molds, filling the molds from the tip up. The wax mixture is cooled using a water cooling system.

STEP 3: QualityAssurance Each Crayola® Crayonis inspected. Molded crayons that do not passinspection are remelted and remolded. Qualitycrayons are fed into acylinder.

How Crayons are Made cont’d

STEP 4: LabelingLabels are then fed onto the rotating cylinder while a white roller presses the label againstthe glue and the label wraps around the crayon twice for

strength.

STEP 5: PackagingCrayola® Crayons are packaged in different size boxes and packages.

All Crayola products are produced at the Crayola Factory in Easton, Pennsylvania.

Since the individual products i.e. crayons, markers, etc are packaged at the factory the products are shipped to the warehouse pre-packaged and remain at the warehouse until needed.

The Crayola warehouse that CMC uses is also located in Pennsylvaniaso transportation from the factory to the warehouse is by fulltruckload quantities.

From the warehouse to CMC is less than truckload quantities of mixed products.

The lead time for orders placed by CMC is 1-2 weeks.

Crayola Factory Facts

Warehouse

Classic Markets,

Corp

Step 2: The Crayola Warehouse

The Crayola warehouse ships to large retailers, such as Wal-Mart, Sam’s Club, Target, etc.

The warehouse also ships directly to schools when the schools deplete their reserves of Crayola products.

The warehouse also ships to companies, such as Sysco,

Warehouse

Classic Markets,

Corp

Step 3: Classic Markets, Corp

CMC supplies to Small Restaurant chains Nationwide, such as Tony Roma’s, Spaghetti Factory, Garfield’s, etc.

CMC acts as a Representative for Crayola to school districts nationwide. CMC sends samples to the schools that Crayola does not have an account with.

CMC also acts as a Representative for food service supply companies such as Sysco.

Warehouse

Classic Markets,

Corp

Classic Markets Office

The CMC location consists of three offices, one conference room, a waiting room, the copy room, the main inventory storage room , and the paint storage room.

The main inventory storage room is approximately 12,000 sq ft and is at capacity 85% of the time.

When the capacity is reached all excess inventory is stored in the main office.

The staff consists of

Carolyn Stiffler (the

owner), one full time

employee,and one part

time employee

Classic Markets Office

A display case in the office shows off all the products Crayola offers or has offeredin the past, including promotionalparaphernalia and specialty products no longer in production.

CMC Inventory Storage

Crayon, Silly Putty, and Promotional Kits storage Est ROP: Crayons 8ct = 200, 16ct =

100, 64ct = 15 boxesSilly Putty = 1/2 dozen eggsPromotional Kits = 10

CMC Inventory Storage cont’d

Colored Pencils, Modeling clay,Scissors, and Markers storage.

Est ROP - Pencils = 60 boxes Clay = 5 buckets

Scissors= 10 pairs Markers= 100 boxes

Paint Storage Room

The different kinds of paint Crayola produces requires itsown storage room

Freight Facts & Figures Freight Methods: Crayola uses a contracted ground carrier.

CMC uses UPS ground shipping Freight charge from Crayola to CMC paid for by Binney &

Smith Freight charge from CMC to customers is paid for by the

customer using standard commercial UPS rates and takes between 3-5 days

Companies for which CMC is the Master Representative have a $500 minimum order amount.

Throughput

Crayola produces 3 billion crayons,540 million colored pencils, 425 million markers, 90 million chalks, 6 million silly putty eggs, and 1.5 million jars of paint per year.

CMC moves 1,000,000+ units per year (a unit is a packagedproduct, not an individual item.)

That’s less than 1% of total volume for Crayola

CMC Distinguished Service Award

In 1999 Classic Markets, Corp received the Distinguished ServiceAward for outstanding customer service out of all Crayola distributorsand representatives in the United States

Crayola Trivia

Did you ever wonder how many crayons a kid will use before age ten?

Do you know the most popular crayon color?