A C-Suite Perspective on Innovation Clusters and Speed to Market

Ian Kalinosky, Division President, KDC Columbus and KDC Lynchburg

Among the first businesses to join the New Albany International Business Park’s Personal Care and Beauty Cluster, KDC Columbus is the leading developer and manufacturer of skin, hair, bath and shower products as well as antiperspirants and deodorants for some of the world’s most successful brands. The location was chosen primarily because of its vertically integrated campus, geographic proximity to major markets, world-class logistics infrastructure and highly skilled workforce.

How does the Personal Care and Beauty Cluster improve speed to market?

It’s a very efficient and progressive model. Synchronizing all of the components of the process reduces supply chain time and working capital. We have collapsed the amount of time it takes to get a product to market by roughly two thirds. The typical supply chain turn around is 30 days and we have been able to reduce that to just 10 days when needed. Because we can operate with less raw material inventory we have also reduced our working capital. We operate in a make and ship model so we have less need for warehousing.

How has KDC’s business changed since it opened its new facility at the Personal Care and Beauty Campus in 2012?

I think we are seeing a great deal more collaboration than in the past and it is resulting in quicker turn around times and more efficiency. Building relationships across companies at the Personal Care and Beauty Campus is changing the nature of how we solve problems with product development, production, delivery and virtually every other aspect of the value chain. It has been so successful that we are considering expanding into the fragrance and scent business.

What other benefits do you see in the vertically integrated model?

It enables our customers to be more agile in responding to consumer demand. Our ability to speed up the replenishment of products allows them to analyze what is selling and place smaller orders that can be shippedin eight to 10 days. Also, many retailers are left with a lot of inventory at the end of the season that has to be discounted. The smaller runs canreduce the amount of product that had to go on sale by a significant amount.

How has collaboration with other related businesses at the campus improved product development and production?

It is really a beaker to box mentality where we have the opportunity to collaborate with companies up and down stream that are located here. We recently participated in a restaging of a product that involved changes to the bottle, formulation, the pump and labeling. It’s the first time that the park leveraged multiple partners to launch a major restaging collectively. It was a very collaborative process that enabled all of us to anticipate problems together and opened channels to communicate more effectively. We successfully ramped up new processes and line trials to take the current product out of production and to begin production on the new product. It was extremely successful.

Is the location a benefit for KDC?

Central Ohio is a very good location, an excellent hub in terms of transportation. The easy access to the interstate system is a huge plus for us. We also find that Central Ohio offers lower energy costs.

Are you able to attract an educated workforce?

We will be opening a research and development facility later this month. When we recruit from outside the city, the people who come here to check it out realize that it is a really great place to not only work, but to raise a family. The cost of living is low and there are many housing options – urban, suburban and rural. We also have great success hiring good talent fresh out of Ohio State.

As a new resident, how would you characterize the quality of life?

For my family, making the move from Cincinnati was a wonderfully easy transition. I have lived in a lot of places and we have had an exceptional experience in New Albany. It’s a very warm, welcoming and vibrant community.