1. Running head: REPUBLIC PAPERBOARD COMPANY 1
Purchasing and Supply Management of Republic Paperboard Company
Addison Rackler and Merranda Taunah
Cameron University – Purchasing and Supply Management
December 9, 2015

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Abstract
The purpose of this paper is to analyze the purchasing and supply management function of
Republic Paperboard Company, which is located in Lawton, Oklahoma. The participants to this
study were Addison Rackler and Merranda Taunah. The methods used were a face-to-face
interview, a tour of the facility and several emails. Subjects discussed include a description of the
organization, purchasing/material function, purchasing process, analysis and discussion of existing
practices, and a day in the life of the interviewee. Our study concluded that Republic Paperboard
Company has a solid purchasing and supply management process.

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Purchasing and Supply Management of Republic Paperboard Company
Republic Paperboard Company, LLC is located at 8801 Southwest Lee Boulevard in
Lawton, Oklahoma. This company began as a subsidiary of Republic Group Incorporated and was
made up of three divisions: Republic Paperboard, Republic Gypsum, and Republic Fiber. There
were three facilities, which were located in Hutchinson, Kansas, Denver, Colorado, and Halltown,
West Virginia. The main product of these factories is the paper used for the face and back side for
the construction of gypsum wallboard. After a decision was made to purchase new technology, a
search for a new paper mill site was initiated. Lawton, Oklahoma was selected due its low freight
cost, high quality workforce, the opportunity to obtain skilled workers, and the reasonable cost of
living. Ground for the 70 acre mill site was broke in May of 1998 and from start to finish, the
construction process took less than 18 months and consisted of 1,300,000 hours of manpower. The
first roll of paper was produced in November of 1999. Republic Paperboard Company, LLC is
now a wholly owned subsidiary company of Eagle Materials.
This company is a secondary industry, also known as a manufacturing industry, because it
involves the manufacturing of raw materials into other products by manual labor and machines.
They have a written delegation of authority which follows a hierarchical structure and relates to
expenditure and purchase approval. All expenditures and purchases must follow the approved
purchasing policy and be reviewed for necessity, reasonableness, and justification. All
expenditures and purchases must be within the individual’s area of responsibility and be within
approved annual spending limits. For example, Ann Frenette, the purchasing manager has a
$10,000 requisition limit and a $2,500 direct purchase limit. The purchasing manager is also
responsible for maintaining the delegation documentation and auditing records for compliance.

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This mill uses 100% recycled paper to manufacture their main product, gypsum wallboard
facing paper. Gypsum wallboard is the key component in the construction of walls and ceilings in
residential and commercial buildings. They also produce other industrial and consumer paperboard
products, such as paper bags for Braum’s, Trader Joe’s, Chili’s, Macy’s, Tommy Hilfiger and
Nautica, just to name a few. As well as facings and corrugated medium of cardboard, and paper
tubing for various businesses (see appendix A for various products produced along with fiber type
and blends, and appendix B for samples of finished product).
Republic Paperboard’s production begins with old cardboard containers (OCC) being
brought in via truck and railway. The Inbound Warehouse is capable of maintaining an appropriate
supply of recycled fiber, along with an overflow area just outside the warehouse. Using forklifts,
bales are dropped into two continuously operated pulpers as stock is pumped out of the bottom of
the pulpers. Stock coming out of the pulpers is diluted with water and pumped through cleaners
where force, similar to a washing machine, causes the unwanted materials, such as wires and trash,
to drop out as rejects, while fiber flows out of the top of the cleaners to be remanufactured into
paper products. Once the pulper has finished breaking down the OCC and eliminating all the dirt
and debris, it is then pushed into the headbox, which is a vessel where the stock/water mixture,
consisting of a concentration of 99.5% water and .05% fiber, is pushed into the paper machine
forming section. Once in the forming section, rapid dewatering takes place by both gravity and
vacuum techniques. This water is then recycled. From here the paper is transferred to the press
section. This section consists of two shoe presses that work in succession, squeezing even more
water out of the paper (see appendix C for a sample of the screening/forming material). Next is the
dryer section, here internally steam heated dryer cans complete the removal of water by
evaporation. Quality control scanners continuously monitor the weight, moisture content, and

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temperature of the paper sheets in order to insure top quality paper is produced at all times. The
final section of the machine is the winder, here paper is wound at speeds up to 8,000 feet per
minute. Typically gypsum liner rolls are approximately 4 feet wide and 80 inches in diameter.
Quality specifications are automatically monitored and measured through utilization of on-line
process control equipment and sensors. The dry end quality lab insures all finished paper products
are checked in order to meet customer specifications before they leave the plant. The rolls can
either be transported from the facility via railcar or truck. The paper machines annual production
capacity is approximately 260,000 tons at speed of 2,500 feet per minute.
Fiber prices are determined each month by the Official Board Market publication, and
depending on market conditions and forecasts, the quantity of material purchased each month may
vary. The forecasted sales volume dictates the production for the upcoming month and this is used
to determine how much of each type of fiber is needed. For example, for the month of October
nearly 30,000 tons of OCC was forecasted to be purchased, while newsblank and
hardwhite/softwhite came in at nearly 2,000 tons and manifold white ledger (MWL) was only
1,000 tons (see appendix D for purchased tonnage in October). The type of equipment used ranges
from basic forklifts and clamp trucks, to high end laboratory instruments, all the way to the big
machine having precise configurations, all in order to promote maximum product quality and
efficiency. Republic Paperboard Company utilizes the distributed control system (DSC) for their
entire papermaking process. A DCS has control elements distributed throughout the system, such
as the camera based monitoring system, which detects surface defects on the paper.
In order to maximize processes, the main part of the paper mill is designed running from
east to west. When a trucker comes in they drop their paper bales at the warehouse furthest east,
which is the recycled fiber warehouse. This building is connected to the next, which is fiber

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preparation, next is the actual paper machine, then on to roll handling, and finally ends up in the
warehouse furthest west, which is the finished good warehouse (see appendix E for a picture of
the layout). The production strategy implemented is a chase strategy. By using this strategy, the
company only produces enough goods to meet its demand. Adopting this strategy keeps inventory
low, which frees up cash that can be used to buy raw materials, and also reduces inventory carrying
costs. Labor requirements vary considerably depending on the position. Workers in the recycled
fiber warehouse, only need a high school education and forklift operator license. However, the
purchasing manager must have a four year degree or equivalent work experience in supply and
inventory management. Republic utilizes a quality management system, which is a set of policies,
processes, and procedures that is focused on achieving products to meet customer needs.
The organizational position and objectives of the purchasing manager at Republic
Paperboard Company is to “procure materials and service components in the manner that supports
the low cost operation requirements of the organization. The objective is to source and purchase
materials and services for the Company ensuring that effective purchasing strategies have been
consistently and effectively utilized, thereby delivering the most cost-competitive and delivery-
competitive materials and services.”
There are six areas that provide raw materials to paper mills around the country. These
areas are: the Northeast, Midwest, Southeast, Southwest, Los Angeles – San Francisco, and the
Pacific Northwest (see appendix F for the breakdown of purchase areas). For the month of October
Republic Paperboard only purchased from the Southwest and Midwest markets, with majority of
the paper coming from the Southwest market (see appendix G for percentage purchased by area).
Purchase volumes depend greatly on the time of year. January through mid-April, OCC is
purchased at a regular rate and the recycled fiber warehouse is full. However, going into the month

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of May product availability begins to decrease at a rapid pace, this continues through July, as
consumers are heading out for vacations and are not purchasing as much goods. Keeping the
warehouse stocked during this time proves a challenge and the purchasing manager begins looking
at other areas to buy product from. Mid-July begins the upward turn again and by September there
tends to be an overabundance of product, at this point the purchasing manager starts turning trucks
away because they are at capacity and their overflow is full. October starts a bit of decline, but
once November hits, a rise starts again, as consumers are out buying for Christmas (see appendix
H for graph of inflow of raw material).
The acquisitions records for all fiber orders are printed in hard copy and are kept onsite for
7 years, after this they are sent to an offsite facility, where they are kept indefinitely. The entire
plant is completely computer based, from the distributed control system (DCS), to administrative
work, all the way to the paper being transported out the door to buyers.
The purchasing process begins with the recognition and description of need. Lisa
McGregor, President analyzes data to configure the amounts and types of materials needed for the
upcoming month. Ms. McGregor then transmits this information, along with ending inventory
numbers to Ms. Frenette via email. Ms. Frenette utilizes the PPI Pulp & Paper Week, among other
sources, to help determine paper prices for the week. She then reaches out to her supplier’s to find
the best prices available for the quality they expect, and proceeds to place her order. Trucks begin
bringing in the bales ordered, and the inbound operators are responsible for inspection of the goods.
If they find that bad bales are trying to be delivered, the trucker will be turned away immediately.
The processes a company utilizes to purchase materials is vital to control risks, prevent
fraud, insure maximum savings, and to maintain regulatory requirements. Republic Paperboard
Company is aware of these issues and has therefore implemented a solid process, which is one of

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their biggest strengths. They have developed a chain of command and set guidelines for approving
purchase orders as they are made and trucks as they are received. Suppliers play an integral role
in a company’s profitability, Ms. Frenette has developed relationships with essential suppliers who
provide good quality, excellent pricing, and as promised delivery timing. She continues to follow
up on her vendors to ensure they continue to meet company standards. Communication is an
important key in any business, and Republic Paperboard Company acknowledges this. Ms.
McGregor continually makes her appearance known throughout the facility, as well as
implementing an open door policy to all of her employees and management. By doing this it
enables employees to feel comfortable stopping by for a chat to bring difficult issues to the table,
this allows an open flow of communication, and in turn opens up fast access to key information,
and overall brings about a closer working relationship for all.
The amount of downtime a company experiences during their productive hours is a type of
lean waste. For every instance of wasted time there are also lost profits. This weakness is visible
during Republic Paperboards “shut down” times. During this time some portion of the machine
has broken or cleaning and maintenance needs to be done. As was observed during our plant tour,
not many employees were seen doing actual work. Cross-training employees is an essential part
of making sure you experience as little downtime as possible. While this type of training will take
time and effort, it will be worthwhile in the form of overall productivity. During these “shut down”
times, simply moving employees around and letting them get a feel for how each job works will
enhance productions. Having cross-trained employees means that a company can shut down
operations in one area and still put employees to work in another.
A day in the life of the interviewee: Ann Frenette is the purchasing manager for Republic
Paperboard Company. The address for the company is: 8801 SW Lee Blvd, Lawton, OK 73505.

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Her email address is: afrenette@lawtonpaperboard.com and phone is: (580) 510-2222. Ms.
Frenette’s educational background includes a 2 year degree in accounting. She began working in
a paper mill while she was attending high school. She worked for 22 years and then moved to the
Lawton plant, where she has been for 10 years. Ms. Frenette’s essential job functions include:
 Procurement of mill materials, repair parts, equipment, operating supplies, and
services.
 Procurement of recycled fiber.
 Vendor selection based on business criteria
 Contract negotiation and execution for products and services purchased
 Formulate and draft bids or purchasing specifications for a wide range of goods and
services
 Negotiate discounts, payment terms, freight, and contract terms
 Acts as liaison for suppliers to secure relationships
 Implement purchasing guidelines
Ms. Frenette works closely with all mill departments. She is able to maintain professional
relationships with mill personnel and suppliers even under stressful circumstances. Ms. Frenette
states that nearly everyday enhances her career development, as she continually sees and
experiences new and different issues. She does participate in seminars and feels hands on
experience is the best teacher.
Our research on Republic Paperboard Company included an interview, a facility tour, and
several emails. Throughout this process we have come to understand the overall picture of
purchasing and supply management of this company. Their values and beliefs include: satisfying
customers with quality, value and service; maintaining ethical business relationships; being team

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players with positive attitudes; respecting the dignity and right of the individual; accomplishing
tasks in a superior time manner; and being good citizens. Republic Paperboard Company, LLC
continues to be successful today, after over 15 years in business.

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References
A. Franette (personal communication, October 2, 2015)
L. McGregor (personal communication, October 2, 2015)
M. Montoya (personal communication, November 15, 2015)