tag:blogger.com,1999:blog-70182305183199998462024-03-14T02:12:55.153-04:00The Strategic SourcerorThe Strategic Sourceror is a news outlet & blog dedicated to procurement, finance & strategic sourcing professionals. We cover industry news, procurement solutions and best practices without heavily focusing on software solutions and providers. The Strategic Sourceror covers topics such as: cost reduction, strategic sourcing, purchasing best practices, spend management, mergers & acquisitions, supply chain innovations, commodity pricing and general procurement news.Strategic Sourcerorhttp://www.blogger.com/profile/01028298940153171661noreply@blogger.comBlogger6298125tag:blogger.com,1999:blog-7018230518319999846.post-74249027854711001122023-02-10T23:10:00.002-05:002023-02-13T11:46:47.834-05:00More truck deliveries expected in 2023<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh5G8CVfa4F-8TXDtKVinAa2sw2TmoQLz_lgfAJZXGha6i-stcQ1_Nfzuqrc1a96Fytj74RT5TjQpu3trojV3urT7aVwyqBjNao10dMQKD-LhFLVg0VyTNeqe0iJGzi0NSkUK7PtdPhA_fu_6qr8aQwa3kWBHFApbeFVbV_hYfVx1mc9jjulFX0-e0x/s500/Motor-carriers-should-have-an-easier-time-buying-new-commercial-trucks-in-2023_834_40196390_0_14124320_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="334" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh5G8CVfa4F-8TXDtKVinAa2sw2TmoQLz_lgfAJZXGha6i-stcQ1_Nfzuqrc1a96Fytj74RT5TjQpu3trojV3urT7aVwyqBjNao10dMQKD-LhFLVg0VyTNeqe0iJGzi0NSkUK7PtdPhA_fu_6qr8aQwa3kWBHFApbeFVbV_hYfVx1mc9jjulFX0-e0x/s16000/Motor-carriers-should-have-an-easier-time-buying-new-commercial-trucks-in-2023_834_40196390_0_14124320_500.jpg" /></a></div>Well before the supply chain disruptions fueled by the the pandemic, the trucking industry was in the throes of a severe driver shortfall that hasn't yet abated. But since COVID-19, motor carriers have also been battling a parts shortage, further pushing them behind the proverbial eight-ball. From drive shafts and semiconductors to a number of other essential parts, the component crunch that's played out over the past several years has exacerbated motor carriers' inability to keep up with the pace of consumer demand.<p></p><p>However, due to waning demand and improvements in the availability of various auto parts, motor carriers and other logistics entities should be able to make some headway in 2023.<br /><br />According to industry experts, several leading original equipment manufacturers (OEMs) have been able to scale up their production due to growth in semiconductor development, the lifting of social distancing measures in overseas markets and a slowdown in orders.</p><p>Jerry Revich, head of U.S. machinery, infrastructure and sustainable tech research at Goldman Sachs, told Transport Dive that for the most part, the <a href="https://www.transportdive.com/news/truck-manufacturing-equipment-outlook-2023/639885/" target="_blank">worst of the parts backlog</a> is in the rearview mirror. </p><p>"Max headwinds from supply chain risk were really over the course of [2022]," Revich explained. "We're now at a point where we're seeing increasing signs of supply, catching up with demand and in some cases, overtaking demand."</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="Heavy-duty truck sales in North America are expected to grow from 2022." class="inlineImage" height="auto" id="14115068" src="https://pictures.brafton.com/x_0_0_0_14115068_800.jpg" width="100%" /><figurecaption>Heavy-duty truck sales in North America are expected to grow from 2022. </figurecaption></figure></div><p><strong>Class 8 truck sales may top 300,000</strong><br />In 2022, an <a href="https://www.businesswire.com/news/home/20230124005370/en/" target="_blank">estimated 283,500 Class 8 trucks</a> were sold in the U.S. and Canada, according to Paccar, one of the world's largest medium- and heavy-duty truck manufacturers. This coming year, retail sales for Class 8s have the potential to exceed 300,000. Class 8 trucks are one of the most common heavy-duty commercial vehicles on the road today and are designed for long-haul transportation needs.</p><p>Revich added that the industry is in a much better place today than it was a year ago, particularly with respect to semiconductor output. While there is still room for improvement, the shortage isn't as bad as it used to be.</p><p>That said, company leaders at other major manufacturers aren't quite as convinced about their ability to ramp up production and delivery. This includes Magnus Koeck, vice president of strategy, marketing and brand management for Volvo Trucks North America.</p><p>"The industry has been facing these challenges for quite a long time now and will continue to have these disturbances to some degree also this year, at least in the beginning of the year," Koeck warned in late 2022, <a href="https://www.transportdive.com/news/trucks-trailers-2022-2023-production-forecast/631804/" target="_blank">as reported by</a> Transport Dive. "We have robust working relationships with our suppliers and dealer network and are working diligently to maximize production and delivery efficiency."</p><p>Differing points of view has been a theme for much of the past year in regard OEM's supply chain. At the annual FTR Transportation Conference, analysts and forecasters had dueling opinions on what Class 8 truck and trailer production would be like in 2023. Some believe that a lot will hinge on whether there's recession on the horizon and how severe it will be.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-77113509592890799982023-02-08T23:10:00.002-05:002023-02-09T10:49:21.662-05:003 products that may be harder to find in 2023<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjkSWPy74VjJ6jkeZdZlPmTCWqrBAlKNZ5CQvCxgmZh993bvZTXw82V80VJWQE-5kQmX9j9tIlDkImPSprDvrjAC6XwTD_goUCHdHEC-3VnB7uv2IYT7Zdz5lNmlPDQCyQlJHwOkooygT5KnYK13jEvIM1GjJB8-boLUYacK947QWI10i1NRiXnZnMM/s500/A-tough-cold-and-flu-season-has-created-a-supply-crunch-for-common-medicines--_834_40196401_0_14132694_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="334" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjkSWPy74VjJ6jkeZdZlPmTCWqrBAlKNZ5CQvCxgmZh993bvZTXw82V80VJWQE-5kQmX9j9tIlDkImPSprDvrjAC6XwTD_goUCHdHEC-3VnB7uv2IYT7Zdz5lNmlPDQCyQlJHwOkooygT5KnYK13jEvIM1GjJB8-boLUYacK947QWI10i1NRiXnZnMM/s16000/A-tough-cold-and-flu-season-has-created-a-supply-crunch-for-common-medicines--_834_40196401_0_14132694_500.jpg" /></a></div>Since 2020, the year COVID struck, product shortages have been routine. From toilet paper to hand sanitizer to N-95 masks and semiconductors, items that are typically easy to obtain were suddenly hard to come by, a product of elevated demand, panic buying and supply chain disruptions. <p></p><p>Those goods are largely back in stock and the health of the supply chain may be better, but shortages still persist. What kinds of merchandise may be hard to find in 2023? </p><p><strong>1. Lettuce</strong><br />The staple ingredient of salads, lettuce wasn't as plentiful in grocers' produce sections in 2022 due to poor weather conditions in California that led to a poor harvest. The Golden State has continued to experience inclement weather into the fall and winter. Ron Scalzo, senior managing director at FTI Consulting, told Supply Chain Dive that this fact <a href="https://www.supplychaindive.com/news/shortages-2023-outlook-food-semiconductor-pharmaceuticals-lithium-evs/640587/" target="_blank">will reduce the availability of leafy greens</a>, as well as some other common salad ingredients.</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="Lettuce farmers had a tough time with production in 2022 due to uncooperative weather conditions." class="inlineImage" height="auto" id="14114350" src="https://pictures.brafton.com/x_0_0_0_14114350_800.jpg" width="100%" /><figurecaption>Lettuce farmers had a tough time with production last year due to uncooperative weather conditions. </figurecaption></figure></div><p><strong>2. Lithium</strong><br />Fueled by higher gas prices, electric vehicle (EV) sales have skyrocketed in the past year, reaching over 200,000 in last year's third quarter, <a href="https://mediaroom.kbb.com/2022-10-19-Electrified-Vehicle-Sales-Hit-Record,-According-to-Kelley-Blue-Book" target="_blank">according to estimates</a> from vehicle valuation firm Kelley Blue Book. As automakers have scaled up production to keep pace with demand, they've wound up depleting certain raw materials. Chief among them is lithium, a rare earth mineral used in EV batteries. As a result, lithium prices are up appreciably, rising 156% in December compared to 12 months earlier, Supply Chain Dive reported from S&P Global Commodity Insights.</p><p>The fact that lithium has to be shipped is also contributing to higher prices. Most of the world's lithium comes from China and Chile, with the South American nation <a href="https://www.bcg.com/publications/2022/the-lithium-supply-crunch-doesnt-have-to-stall-electric-cars" target="_blank">exporting approximately two-thirds</a> of the globe's lithium carbonate, according to Boston Consulting Group.</p><p><strong>3. Certain over-the-counter and prescription medicines</strong><br />Over-the-counter (OTC) medicines are described as such because they're widely available; users don't need a prescription from their primary care physician to buy what they need for treating the common cold, headaches, soreness and other routine ailments. But a surge in seasonal flu, respiratory syncytial and COVID-19 diagnoses has created a supply crunch for these typically easy-to-get pharmaceuticals like ibuprofen and acetaminophen. In December, in fact, drug store chains Walgreens and CVS placed a buying limit for parents buying antipyretics, which are medicines that are designed to treat fevers.</p><p>"We're committed to meeting our customers' needs and are working with our suppliers to ensure continued access to these items," a CVS spokesperson <a href="https://www.supplychaindive.com/news/cvs-walgreens-cap-sales-childrens-pain-relievers/639276/" target="_blank">told</a> Supply Chain Dive in an email.</p><p>Another medicine in limited supply is amoxicillin. Amoxicillin requires a prescription and is used as a first-line defense for treating primarily bacterial-related infections, such as those affecting the urinary tract, skin and ears. In November, the Food and Drug Administration <a href="https://www.fda.gov/media/163367/download" target="_blank">warned about</a> an "acute shortage" of amoxicillin administered orally.</p><p>The FDA as a result has urged drug makers to scale up their production of beta-lactam oral suspension products by working with their suppliers.</p><p>Building materials, electrical components and other rare earth minerals (e.g. cobalt, graphite) may also be in short supply in 2023.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-20799873520949868502023-02-06T23:10:00.002-05:002023-02-07T07:56:33.414-05:00Severe graphite shortage looms as EV sales surge<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh4i9P95v4GmW8s9ZRNwpWm6NKbgPKSBFWdCEngEThoDpryI0csGkNwXdFLk2ZO6bnsP4T9AtI42q9G0qgcyGD0mcKADFgb7e1a2YbbN4wagQvofcqGpAK6zcN9fmAUQwjxotazrm6XdmbHMrtmSMKh209RlhcT6RCsML9sWODAIV7W7JEPNwsJc0PF/s500/Growing-reliance-on-rare-earth-minerals-like-graphite-for-EV-production-may-lead-to-supply-chain-problems-down-the-road-_834_40196396_0_14109882_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="334" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh4i9P95v4GmW8s9ZRNwpWm6NKbgPKSBFWdCEngEThoDpryI0csGkNwXdFLk2ZO6bnsP4T9AtI42q9G0qgcyGD0mcKADFgb7e1a2YbbN4wagQvofcqGpAK6zcN9fmAUQwjxotazrm6XdmbHMrtmSMKh209RlhcT6RCsML9sWODAIV7W7JEPNwsJc0PF/s16000/Growing-reliance-on-rare-earth-minerals-like-graphite-for-EV-production-may-lead-to-supply-chain-problems-down-the-road-_834_40196396_0_14109882_500.jpg" /></a></div>With more Americans buying rechargeable cars — and several automakers expanding their hybrid and all-electric offerings — the automotive industry is turning to the rare earth metals market. These materials, namely lithium, cobalt, nickel and several others, are critical for manufacturing the lithium-ion batteries electric and hybrid cars need. But with such minerals already being limited in the U.S., there are growing fears that demand may vastly outstrip supply, compromising other industries that rely on such materials.<p></p><p>This is particularly true of graphite. Used as a lubricant for making pencil leads, heat exchangers and as a moderator in nuclear reactors, graphite has a wide variety of industrial applications. But it's also crucial to battery production, serving as an electrode both for batteries as well as fuel cells.</p><p>However, as The Wall Street Journal reported (based on Benchmark data), natural graphite is very difficult to come by these days because production hasn't been able to keep pace with demand. Indeed, at the current rate of usage, the U.S. <a href="https://www.wsj.com/articles/shift-to-mined-vs-man-made-graphite-raises-shortage-risk-for-evs-11674603067?utm_source=Sailthru&utm_medium=email&utm_campaign=Newsletter%20Weekly%20Roundup:%20Supply%20Chain%20Dive:%20Daily%20Dive%2001-28-2023&utm_term=Supply%20Chain%20Dive%20Weekender" target="_blank">could have a 1.2 million metric ton shortfall</a> of natural graphite by 2030.</p><p>Brent Nykoliation, executive vice president of NextSource Materials, told the Journal that this could be a massive predicament for automakers, given how much of a traditional car battery is composed of graphite.</p><p>"Graphite always seems to be the forgotten battery material, yet it's in half the battery," Nykoliation said. "It's the largest raw material in the battery."</p><p>The typical lithium-ion battery can have up to 10 times as much graphite as it does lithium, another mineral that is needed for the manufacturing process.</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="Prospective buyers say the environmental benefits of EVs are fueling their interest." class="inlineImage" height="auto" id="14094356" src="https://pictures.brafton.com/x_0_0_0_14094356_800.jpg" width="100%" /><figurecaption>Prospective buyers say the environmental benefits of EVs are fueling their interest. </figurecaption></figure></div><p><strong>EV sales top 200,000 in third quarter of 2022</strong><br />While electric vehicles aren't nearly as popular as traditional gas-powered automobiles, sales have intensified substantially over the last year or so — and are expected to pick up the pace as competition increases and prices diminish. Indeed, in the third quarter of 2022, <a href="https://mediaroom.kbb.com/2022-10-19-Electrified-Vehicle-Sales-Hit-Record,-According-to-Kelley-Blue-Book" target="_blank">over 200,000 EV were sold nationwide</a>, according to Kelley Blue Book. That's the first time that quarterly EV sales have surpassed 200,000.</p><p>They've also gained a following among young people: A majority of 18- to 29-year-old Americans said that they're "somewhat" or "very" likely to buy an EV the next time they're in the market for an automobile, <a href="https://www.pewresearch.org/fact-tank/2022/08/01/americans-support-incentives-for-electric-vehicles-but-are-divided-over-buying-one-themselves/" target="_blank">according to polling</a> by the Pew Research Center. And among those who have considered buying an EV, close to 75% said their desire to help the environment was a major reason why.</p><p>As demand has grown for graphite, exceeding the pace with which mines can replenish the material, prices have followed suit, with a metric ton of battery-grade natural graphite selling for $812.50, the Journal reported. That's a 25% increase compared to 2020.</p><p>Automakers say that they're working with their suppliers to see what can be done to acquire as much graphite as they can and how producers can scale up output. Some are resorting to using synthetic graphite, made from petroleum. However, critics point out that the production processes involved emit massive amounts of carbon into the atmosphere, a primary contributor to greenhouse gas emissions — nullifying the environmental advantages that EVs are supposed to foster.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-73884939708007998502023-02-03T23:10:00.005-05:002023-02-06T12:46:32.695-05:00Visibility is crucial for supply chains<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiADJIen9z7FDpB8eg6rqfcPO3TftS4pES1SbDzUUaOmBybOkua2ZGUZMzDHgkpj8EgyRrCZ0Y71V7dOkWCpP0t4LubPEjC_ZzxP20nMyhjltJKWoa8cgWK0x8hdIIsjLpm5nQw5I-vzChGRJ6Bc-YZrU3TfUl0AbWmco5BzAtTuddj63gMTlvhcUWK/s500/Visibility-is-crucial-for-supply-chains_834_40195768_0_14122547_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="334" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiADJIen9z7FDpB8eg6rqfcPO3TftS4pES1SbDzUUaOmBybOkua2ZGUZMzDHgkpj8EgyRrCZ0Y71V7dOkWCpP0t4LubPEjC_ZzxP20nMyhjltJKWoa8cgWK0x8hdIIsjLpm5nQw5I-vzChGRJ6Bc-YZrU3TfUl0AbWmco5BzAtTuddj63gMTlvhcUWK/s16000/Visibility-is-crucial-for-supply-chains_834_40195768_0_14122547_500.jpg" /></a></div>As any supply chain professional will tell you, managing various day-to-day operations and keeping track of everything going on in the supply chain are among the most difficult parts of the job. These tasks, combined with the increasing levels of complexity and risk that modern supply chains have had to go through, has made tracing exactly what's going on even more difficult than it had been in the past. For these reasons, many high-end supply chain organizations are investing their money into visibility solutions to get a better handle on their supply chains.<p></p><h2>Why is visibility so important?</h2><p>The most critical part of running any supply chain is ensuring you are making the best possible decisions quickly. For any organization to make clear rational choices, a vast quantity of information is needed. This kind of information can only be accessed by specific visibility solutions which can help pinpoint where inefficiencies are occurring in any transport of goods. Some of the key advantages that visibility solutions bring include:</p><h3>Less risk</h3><p>According to McKinsey, organizations that have implemented digital dashboards for their supply chain visibility needs were <a href="https://www.mckinsey.com/capabilities/operations/our-insights/taking-the-pulse-of-shifting-supply-chains" target="_blank">twice as likely</a> to have avoided the supply chain issues that plagued the industry in the early months of 2022. This reduction in risk is due to the fact that organizations with end-to-end supply chains can easily determine where there is likely to be risk, or identify problem areas and work quickly to avoid them.</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="" class="inlineImage" height="auto" id="14124248" src="https://pictures.brafton.com/x_0_0_0_14124248_800.jpg" width="100%" /><figurecaption></figurecaption></figure></div><h3>Higher levels of proactivity</h3><p>The ideal supply chain should be proactive to risk and change rather than reactive. Having increased visibility means that your organization will be able to see issues from a lot farther off, or better understand the inefficiencies that may have existed in your supply chain for a long time without oversight. At the end of the day, visibility is all about information, and the data that you can gain from investing in a visibility solution can rapidly add value to your efforts for a more proactive and long-term sustainable supply chain.</p><h3>Reduced costs</h3><p>Ultimately, visibility boils down into long-term operational efficiency. The ability to make more effective strategies across your supply chain can help reduce costs associated with product sitting in one place too long, inefficient transit routes, or loss due to risk. With greater visibility also comes better reporting on risk, which can be used to help convince your insurers you deserve better rates. A well-implemented visibility solution with organizational backup can help to deliver a strong ROI for any organization involved in mid-to-large scale logistical operations.</p><p>Visibility solutions are critical for any organization looking to make a positive impact on its supply chain. Having a clear picture of what is going on across your network at all times, and using that data to create informed plans is invaluable for your business.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-78159523120000105732023-02-03T23:10:00.004-05:002023-02-06T12:30:30.480-05:00Is your supply chain recession ready?<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiOED6JV580MBVssH3g3zEM6lDZgFbLJegVFbkJyH2k1J-AyDJNHCkGQdnkkfvQvlKCCylR7AL-nSQmt4kaV8Pfsv2UBpPtr0drCXJ0qjj3GNzfevolbGXaV_KQkiAmsKMadkkzNFh_SOgk9h_Dcr3Q-LYyhcn1T6ieMtarzl4aiCZEI8PJaztyrHDV/s500/Is-your-supply-chain-recession-ready_834_40196352_0_14062015_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="332" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiOED6JV580MBVssH3g3zEM6lDZgFbLJegVFbkJyH2k1J-AyDJNHCkGQdnkkfvQvlKCCylR7AL-nSQmt4kaV8Pfsv2UBpPtr0drCXJ0qjj3GNzfevolbGXaV_KQkiAmsKMadkkzNFh_SOgk9h_Dcr3Q-LYyhcn1T6ieMtarzl4aiCZEI8PJaztyrHDV/s16000/Is-your-supply-chain-recession-ready_834_40196352_0_14062015_500.jpg" /></a></div>There have been rumors of an incoming recession for a while now. With this in mind, there's no time like the present to evaluate whether your supply chain will be able to weather the storm of another set of unfavorable economic conditions. There are plenty of challenges that a recession can bring, and having a set response for each of them could help your organization stay ahead of the competition.<p></p><h2>Why this recession may be different</h2><p>Luckily, this possibly upcoming recession is accompanied by some underlying conditions that change a lot about traditional thinking. According to a Gartner report, there's a big difference this time around, namely that today's supply chains are currently <a href="https://www.gartner.com/en/articles/supply-chain-leaders-its-time-to-rethink-your-recession-playbook" target="_blank">supply-constrained</a> due to global uncertainty and the ongoing effects of the COVID-19 pandemic. This may give your organization the opportunity to finally balance out its supply with its demand and retain a much more even keel than it might be operating on today. The report goes on to say that for organizations to get ready for this possible recession, there are three things that need to happen:</p><ul><li>Your company needs to identify where its resource bottlenecks are.</li><li>Your supply chain organization needs to evaluate where it feels it can take risks even in a down-turned market.</li><li>You must prepare for when the market starts to recover to thrive.</li></ul><p>What this means for many companies is that the recession may not be as bad for them as originally thought. The clear message that Gartner is sending should be reiterated and thought about by any supply chain professional. Success comes from taking careful stock of what could happen in the future and managing your risks appropriately. Companies that understand this the best will come out of the recession as if it had never happened, and indeed possibly in a better position than they were before.</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="" class="inlineImage" height="auto" id="14089080" src="https://pictures.brafton.com/x_0_0_0_14089080_800.jpg" width="100%" /><figurecaption></figurecaption></figure></div><h2>There are still steps you can take as a precaution</h2><p>While the recession may not be bad for your organization, there still is no guarantee. Your company should be taking steps to ensure it isn't blindsided by a sudden change in economic conditions. Here are couple of best practices that you should follow just in case:</p><ul><li><strong>Keep a close eye on your suppliers:</strong> You might be in a good spot for the recession, but it doesn't mean your suppliers are. A supplier might suddenly fold, leaving you in the lurch. By keeping an eye on how they're doing, you'll avoid any unpleasant surprises.</li><li><strong>Plan ahead:</strong> While this is the first rule of supply chain management, taking the time to understand where your organization may fall in terms of a recession will be helpful for your company in the long run.</li></ul><p>Whether a recession comes in 2023, having clear knowledge of where your company could be vulnerable and creating plans to mitigate risk represent the best way to ensure your organization doesn't face major trials should the economic worst come to pass.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-65120645560245438702023-02-01T23:10:00.005-05:002023-02-02T10:11:52.512-05:00Why cybersecurity is important for your supply chain<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiYsSwCbsWglctLf0W3P37U_um3e0W-iB5h0l9bz_ltPG7EdGGZvcOlvnfvlwFoqKAjMdWjjQ6oJBPFmmbBCqvZMIACB5SPS911Q3qr18K-js8-O5GTVz4NMv3WLGWSCIpL5oNQAXQYOnCmoomlvNC9Mz2vMkAMAPzjNC9Ox8PWl1Mrlbe8bC-s6ylx/s500/Cybersecurity--for-supply-chains-is-just-as-important-if-not-more-so-than-physical-security_834_40196371_0_14096131_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="254" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiYsSwCbsWglctLf0W3P37U_um3e0W-iB5h0l9bz_ltPG7EdGGZvcOlvnfvlwFoqKAjMdWjjQ6oJBPFmmbBCqvZMIACB5SPS911Q3qr18K-js8-O5GTVz4NMv3WLGWSCIpL5oNQAXQYOnCmoomlvNC9Mz2vMkAMAPzjNC9Ox8PWl1Mrlbe8bC-s6ylx/s16000/Cybersecurity--for-supply-chains-is-just-as-important-if-not-more-so-than-physical-security_834_40196371_0_14096131_500.jpg" /></a></div>If you haven't updated your organization's cybersecurity posture yet — it's time to consider it. Supply chains are a valuable asset that malicious actors view as high priority targets as they are a central backbone to any company. Furthermore, large supply chain organizations are viewed by nation state-level cyberwarfare organizations as force multipliers for their attacks, helping them cause chaos on a widespread level. The risk of cyberattack on your organization's supply chain is only going to increase from this point forward as cybercriminals become more advanced and bold in their attacks.<p></p><h2>Any company can be affected by cyber threats</h2><p>While cyberattacks bringing supply chains to a halt isn't a new idea, <a href="https://www.wired.com/story/notpetya-cyberattack-ukraine-russia-code-crashed-the-world/" target="_blank">Maersk and FedEx</a> were famously shut down by the NotPetya attacks that struck the companies' holdings in Europe, as well as other organizations, for billions of dollars' worth of damage. Many business leaders are predicting even more catastrophic attacks to happen worldwide in the wake of the global instability we are facing heading into 2023.</p><p>A World Economic Forum report has recently found that <a href="https://www.weforum.org/reports/global-cybersecurity-outlook-2023" target="_blank">93% of cybersecurity experts</a> and 86% of business leaders believe that an incredibly damaging cyberattack could happen within two years. This is a cause for concern for any organization running its own supply chain, or that of others — as it could cause lost business and general confusion for long periods of time.</p><p>As the supply chain space has become more digitized and reliant on technology, it has also ramped up the levels of risk that it faces. Each tool your organization uses can be compromised and could lead to your network facing serious malware, spyware or ransomware issues. Should this happen, your organization could face a loss in delivery speed, an inability to properly ship products or track those shipments and a loss of trust from your customers. Luckily for your business, there are some best practices that can be followed to mitigate the risks that you face.</p><h2>Making sure your supply chain is more secure</h2><p>With only <a href="https://www.supplychainbrain.com/blogs/1-think-tank/post/35798-why-cybersecurity-has-never-been-more-important-for-the-supply-chain-sector" target="_blank">21% of supply chain executives</a> believing that their supply chains are highly resistant to cyber threats, the time to start updating your security protocols is now. In order to get your security posture in line with what it should be, there is one main step that you should consider to ensure your company is adequately protected.</p><h2>Adopt a cybersecurity framework</h2><p>The first thing your organization should do is find and adopt a cybersecurity standard recommended by a governing body. A clear example of this would be the <a href="https://www.nist.gov/cyberframework/framework-documents" target="_blank">NIST framework</a> ,which provides strong controls for organizations as well as reporting practices and requirements for a solid cybersecurity posture. These frameworks are strong tools for any IT professional to have a clear understanding of what they need to do, and how to do it — it's also very helpful that these standards are reasonably strong against cyber threats.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-29830712759637692022023-02-01T23:10:00.004-05:002023-02-02T10:11:28.521-05:003 reasons why egg prices have skyrocketed<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEieGEQydDXpgGvokdx8q_zAWPF_n_epqd1zTWx-_W3XHFCr3h-4Qzope9GE_brvp2ZpMuAImxJlts27WOulufTpXXo3CIF-zHoMRGDPptFiM8WZS6OEwrh3kqYrGgRsow29gbYRl9RYhD9dC7AA_jRrRGT7a75CT25fj9AMtVXQyuBKzPPOx7eTUCb3/s500/Avian-flu-has-decimated-the-hen-population-which-has-led-to-fewer-eggs-_834_40196394_0_14105160_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="334" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEieGEQydDXpgGvokdx8q_zAWPF_n_epqd1zTWx-_W3XHFCr3h-4Qzope9GE_brvp2ZpMuAImxJlts27WOulufTpXXo3CIF-zHoMRGDPptFiM8WZS6OEwrh3kqYrGgRsow29gbYRl9RYhD9dC7AA_jRrRGT7a75CT25fj9AMtVXQyuBKzPPOx7eTUCb3/s16000/Avian-flu-has-decimated-the-hen-population-which-has-led-to-fewer-eggs-_834_40196394_0_14105160_500.jpg" /></a></div>Selling for significantly more than they did as little as a year ago, egg prices have cracked all sort of records. While some have attributed the cost growth solely to the effects of inflation, there are a variety of factors at work, much of it having to do with diminished supply.<p></p><p><strong>1. Avian influenza</strong><br />Perhaps the biggest contributor to the problem is avian influenza. Otherwise described as bird flu, avian influenza is a highly contagious viral disease that has hit many poultry farms throughout the U.S. Because avian influenza can be spread from chickens to animals, farmers have been forced to cull their flocks on the off-chance that their birds may be infected. For example, in Nebraska, a leading national producer of eggs, over <a href="https://www.wsj.com/articles/worst-avian-flu-in-u-s-history-is-hitting-poultry-wild-birds-even-bears-11674366891?mod=djemlogistics_h" target="_blank">6.7 million chickens have been linked to the outbreak</a>, according to federal data obtained by The Wall Street Journal. Colorado, meanwhile, has seen its hen population dip by 90% over the past year. Overall, <a href="https://www.wsj.com/articles/egg-prices-shortage-avian-flu-11673629381" target="_blank">at least 58 million birds</a> (including turkeys) have died because of avian influenza, whether they were infected or culled as a preventive measure, the Wall Street Journal reported separately.</p><p>Maggie Baldwin, a veterinarian in the Centennial State, told the WSJ that the strain has decimated Colorado's poultry population — and there's no end in sight.</p><p>"One of the challenges is that we don't know why it has been able to thrive for so long," Baldwin explained. We're almost a full year into this outbreak and it is ongoing."</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="Egg prices are up everywhere, largely due to diminished production from chickens." class="inlineImage" height="auto" id="14120295" src="https://pictures.brafton.com/x_0_0_0_14120295_800.jpg" width="100%" /><figurecaption>Eggs prices are up everywhere, largely due to diminished production from chickens. </figurecaption></figure></div><p><strong>2. Food costs</strong><br />Another contributing factor is inflation, particularly food inflation. Both the United Nations' <a href="https://www.fao.org/worldfoodsituation/foodpricesindex/en/" target="_blank">Food Price Index (FPI)</a> and the Labor Department's <a href="https://www.bls.gov/news.release/pdf/cpi.pdf" target="_blank">Consumer Price Index (CPI)</a> climbed dramatically in 2022. While these respective measures have diminished more recently — down nearly 2% in December for the FPI and 0.1% for the CPI — food costs remain considerably higher than they were a year earlier.</p><p><strong>3. Poor chicken feed quality </strong><br />Although the evidence is more anecdotal than documented, some poultry farmers have claimed their hens aren't laying any eggs. Generally speaking, a fully grown hen lays one egg every 24 to 26 hours. But both professional and amateur chicken farmers have taken to social media and said some of their chickens have gone several months without producing a single one.</p><p>"My chickens have not laid an egg since July, and nothing's changed," said one man in a TikTok video, <a href="https://www.eviemagazine.com/post/egg-prices-in-california-rise-550-and-the-state-is-blaming-it-on-bird-flu" target="_blank">as reported by</a> Evie Magazine. He added that he's seen other people on social media attest to encountering the same issue. The man further stated that production resumed after switching to a different feed that he bought from a local producer. </p><p>The primary cause of higher egg prices is bird flu, and it's unclear when that condition will subside. The limited supply of eggs likely won't normalize until chicken flocks are replenished, which could take several more months, depending on how quickly farmers are able to bounce back and the speed with which hens grow. According to the University of Wisconsin-Madison, egg laying hens usually <a href="https://livestock.extension.wisc.edu/articles/life-cycle-of-a-laying-hen/#:~:text=When%20do%20hens%20begin%20to,they%20are18%2D%2022%20weeks%20old." target="_blank">begin to produce eggs</a> by the time they reach 5 to 6 months of age.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-59242175510025174642023-01-20T23:10:00.014-05:002023-01-23T12:16:53.881-05:00What's happening to the global market for medical supplies?<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhjDhujaWFU4DUo8KhTqoKGdhwJX8AyEwCxGVJpS-Ee4BnsbRZyx-DfVoPKRyQc0t8XWi02TNa1aiQP3gBYwB-nbv_iWQeAY2w5MSA4XlkBfnO8q6u3YR0-9WvQlGm7-nixyA3ZdRtS_kwUcMQPQ7V3RxtZQmfcx5XKzUaYu1uB8RnYHc4Oqc3Flhtd/s500/An-overreliance-on-Chinasourced-medical-supplies-could-expose-US-health-facilities-to-heightened-supply-chain-risk_834_40196105_0_14085470_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="334" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhjDhujaWFU4DUo8KhTqoKGdhwJX8AyEwCxGVJpS-Ee4BnsbRZyx-DfVoPKRyQc0t8XWi02TNa1aiQP3gBYwB-nbv_iWQeAY2w5MSA4XlkBfnO8q6u3YR0-9WvQlGm7-nixyA3ZdRtS_kwUcMQPQ7V3RxtZQmfcx5XKzUaYu1uB8RnYHc4Oqc3Flhtd/s16000/An-overreliance-on-Chinasourced-medical-supplies-could-expose-US-health-facilities-to-heightened-supply-chain-risk_834_40196105_0_14085470_500.jpg" /></a></div><br />Medical equipment has been in short supply since the start of the COVID-19 pandemic. However, even as the public health crisis subsides, supply chain uncertainties persist, leading some manufacturers to reconsider some of their long-standing supplier relationships.<p></p><h2>US dependence on Chinese medical suppliers is overblown — but still real</h2><p>The United States has long been dependent on China for a range of medical supplies and equipment. While the degree of dependency is sometimes exaggerated by pundits and commentators, U.S. medical facilities still import a significant volume of equipment from China, including medicines, personal protective equipment, testing kits and more.</p><p>One report from the U.S. International Trade Commission near the start of the pandemic <a href="https://usitc.gov/publications/332/covid-19_related_goods_us_imports_and_tariffs_commission.xlsx" target="_blank">found</a> that among 203 medical product categories analyzed, China is the dominant source of imports for 32 of them.</p><p>Commenting on the report, the Cato Institute <a href="https://www.cato.org/blog/determining-americas-dependence-china-essential-medical-goods" target="_blank">concluded</a> that, "far from suffering some sort of major 'dependence' crisis … the United States generally imports essential medical goods from a diverse (and everchanging) group of foreign suppliers."</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="Medical facilities in the United States consider diversifying their suppliers to offset their overreliance on China." class="inlineImage" height="auto" id="14096135" src="https://pictures.brafton.com/x_0_0_0_14096135_800.jpg" width="100%" /><figurecaption>Medical facilities in the United States consider diversifying their suppliers to offset their overreliance on China.</figurecaption></figure></div><h2>Slowdowns in China are concerning but limited in impact</h2><p>Much of that is due to changes U.S. manufacturers and government officials implemented in the first days of the COVID-19 pandemic. As the virus swept through China and the Chinese leadership instituted strict lockdowns to combat its spread, U.S. officials worked to identify alternative suppliers and build stockpiles of key medical supplies.</p><p>Despite this diversification of medical suppliers, further COVID-19 outbreaks in China in 2022 and 2023 and the resulting manufacturing slowdowns have created shortages that individual facilities have found it difficult to address.</p><p>Officials are on guard, waiting to see how the measures taken at the start of the public health crisis will stand up to the latest closures.</p><p>"We're looking a lot for potential early warning signs in the medical supply chain for any kinds of disruptions," <a href="https://www.nbcnews.com/politics/politics-news/chinas-covid-wave-threatens-another-snarl-us-medical-supply-chain-rcna64692" target="_blank">said</a> one U.S. official to NBC News. "At this point, we haven't detected any current or likely disruptions, at least to the flow of drugs or devices or supplies of PPE (personal protective equipment) to the United States given what's going on in China."</p><h2>Manufacturers might not be willing to wait and see</h2><p>Still, official reassurances aside, some medical facilities might begin reconsidering their options, which could be a significant economic boon to China's neighbors and other suppliers.</p><p>Medical Design & Outsourcing <a href="https://www.medicaldesignandoutsourcing.com/the-u-s-china-trade-war-heres-what-it-means-for-medical-device-industry-suppliers/" target="_blank">identified</a> Malaysia, Thailand, Vietnam, Costa Rica and Mexico as potential candidates before the pandemic, and manufacturers in other sectors are already <a href="https://www.scmp.com/tech/big-tech/article/3206294/india-vietnam-gain-supply-chain-shifts-away-china-2023-survey-finds" target="_blank">considering</a> moving operations to countries like India and Vietnam.</p><p>While it's yet to be seen if the latest COVID-related disruptions will lead to a complete rethink of the manufacturing relationship with China, those conversations are likely already taking place in boardrooms across the country.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-2873166017295277512023-01-20T23:10:00.013-05:002023-01-23T12:16:30.636-05:00Smart warehousing solutions and what they could mean for your business<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhBQrt7UKyY6G2o1pdG5XQhcFStu_qtDJQKOCHYGCfMRPOs-HBIA_gSRvNdvDVeI_He_tA09kL6Ic7jIWrTYaD7X4XOyeG4tLr37WewONwb51dxnTi_xy5XL6fQOIN_sgpc7LoDNvQRkMAqYa2KS6ElaRWwnpJQpturkDr5DQ55c5rkC5EwI4PPSPTO/s500/Warehouse-management-solutions-can-help-companies-overcome-their-pressing-supply-chain-challenges_834_40196106_0_14112787_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="334" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhBQrt7UKyY6G2o1pdG5XQhcFStu_qtDJQKOCHYGCfMRPOs-HBIA_gSRvNdvDVeI_He_tA09kL6Ic7jIWrTYaD7X4XOyeG4tLr37WewONwb51dxnTi_xy5XL6fQOIN_sgpc7LoDNvQRkMAqYa2KS6ElaRWwnpJQpturkDr5DQ55c5rkC5EwI4PPSPTO/s16000/Warehouse-management-solutions-can-help-companies-overcome-their-pressing-supply-chain-challenges_834_40196106_0_14112787_500.jpg" /></a></div>As suppliers increasingly look for ways to overcome operational challenges in their warehouses, some are beginning to leverage smart warehouse technology like automation and artificial intelligence to improve the productivity of their warehouse associates and enhance their processing efficiencies.<p></p><p>Reflecting this trend, the global smart warehouse technology market is <a href="https://www.kbvresearch.com/press-release/smart-warehousing-market/" target="_blank">expected</a> to surge over the next few years, reaching a valuation of $29 billion by 2028, according to data from KBV Research.</p><h2>Popular smart warehouse technology in use today</h2><p>There is an extensive range of smart warehouse solutions currently used by some of the largest (and highest-performing) companies. Among the most common are:</p><ul><li><strong>Warehouse management systems: </strong>WMS software centralizes all supplier and inventory data in a single system, giving your warehouse managers complete oversight of all fulfillment functions. Managers can use this information to make data-driven decisions about their internal processes to optimize performance and improve output.</li><li><strong>Robot palletizing solutions:</strong> These machines automate the tedious and time-consuming process of packaging materials onto pallets for storage and transportation. Not only do robot palletizers drastically enhance processing efficiencies and improve production speeds, they also reduce the incidence of human error for better quality outcomes.</li><li><strong>Internet of things (IoT) devices: </strong>You can equip materials in your warehouse with advanced IoT sensors to digitally track their movements throughout your supply chain. IoT devices can support your inventory management functions while giving you precise tracking information about specific items for more accurate reporting and forecasting.</li></ul><p>As smart technology becomes an increasingly important part of daily operational procedures, expect organizations to rely on it to bolster their supply chain management strategies.</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="Warehouse management software could help companies transform their central tasks and processes." class="inlineImage" height="auto" id="14147443" src="https://pictures.brafton.com/x_0_0_0_14147443_800.jpg" width="100%" /><figurecaption>Warehouse management software could help companies transform their central tasks and processes.</figurecaption></figure></div><h2>Operational advantages throughout your company</h2><p>While increasing efficiencies and improving productivity are among the primary advantages to deploying smart warehouse technology, organizations stand to experience numerous other downstream benefits as well. These include:</p><ul><li><strong>Investing resources into high-value priorities: </strong>Automating the manual, repetitive functions of your warehouse liberates your human capital and lets warehouse associates focus their creative resources on more complex problems. It also directs your limited bandwidth to higher-value priorities that drive innovation and create new value for your customers.</li><li><strong>Facilitating scalability during high-demand seasons:</strong> Streamlining your operations with a leaner workforce gives you the capacity to scale up or down depending on your needs. It allows you to handle a larger volume of inventory without creating bottlenecks or inaccuracies while keeping costs within budget.</li><li><strong>Improving customer satisfaction:</strong> On the whole, smart warehousing technology reduces labor and operational costs (which suppliers can push down to consumers) and enhances processing times for faster (and more accurate) shipments. All of this leads to greater customer satisfaction, loyalty and long-term profitability.</li></ul><p>Used strategically, smart warehouse technology can play a vital role in future-proofing your business and increasing your operational resilience in the face of endemic supply chain challenges.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-4437769725408752822023-01-20T23:10:00.012-05:002023-01-23T12:15:46.501-05:003 ways inflation is impacting global supply chains<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiZaVFmnzoU8tvNAi0Ll_PnOh8Ew6KUwk3wNiJKiaptNjctldN7ScP87KnOppBzXpI_rvFPLL4-WhBLcd5Le6jUNDcDO3CScOC8JgXKbFkXYJNSfGsMs0S9HWjdsC7Kr0Uc0K9q_JKmhIMTe5zUO9xZKql9IxKf8N2_3u86iwfFtiAeZ7Fclr2r5x79/s500/Rising-inflation-can-have-significant-consequences-for-global-supply-chains_834_40196109_0_14123974_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="334" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiZaVFmnzoU8tvNAi0Ll_PnOh8Ew6KUwk3wNiJKiaptNjctldN7ScP87KnOppBzXpI_rvFPLL4-WhBLcd5Le6jUNDcDO3CScOC8JgXKbFkXYJNSfGsMs0S9HWjdsC7Kr0Uc0K9q_JKmhIMTe5zUO9xZKql9IxKf8N2_3u86iwfFtiAeZ7Fclr2r5x79/s16000/Rising-inflation-can-have-significant-consequences-for-global-supply-chains_834_40196109_0_14123974_500.jpg" /></a></div>High inflation has been one of the lingering consequences of the COVID-19 pandemic. According to the U.S. Department of Labor, the Consumer Price Index in November 2022 had <a href="https://www.bls.gov/cpi/" target="_blank">increased</a> 7.1% over the previous 12 months. Resurgent consumer demand, business closures, transportation disruptions and port congestion have all conspired to put pressure on suppliers and raise the cost of doing business.<p></p><p>Many suppliers and manufacturers have struggled to adjust their management and logistical structures to keep pace, forcing them to push increased costs down to consumers. While this can help them maintain profit margins in the short term, it only contributes to the rise of prices across the supply chain and the long-term persistence of inflation, putting businesses in a double bind.</p><p>Regardless of the possible solutions, inflation is likely to pose several challenges for suppliers and manufacturers throughout 2023 (and beyond). These include:</p><h2>1. Increased foreign exchange risk exposure</h2><p>Many manufacturers and suppliers today maintain business relationships across international borders, meaning they often have to deal in multiple currencies and balance fluctuating exchange rates. Inflation tends to impact countries in different ways, however, and less stable currencies are often unable to weather the crisis and maintain their value.</p><p>Businesses that buy from suppliers based in countries with weaker currencies could expose themselves to significant risk if the values of those currencies drop too much, while those that sell to certain buyers might make bloated returns that artificially inflate performance reports and revenue projections.</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="Businesses might respond to inflation by overstocking warehouses, which could make inflation worse." class="inlineImage" height="auto" id="14126944" src="https://pictures.brafton.com/x_0_0_0_14126944_800.jpg" width="100%" /><figurecaption>Businesses might respond to inflation by overstocking warehouses, which could make inflation worse.</figurecaption></figure></div><h2>2. Raw materials procurement could fuel further inflation</h2><p>Raw materials are in short supply and many manufacturers are finding it difficult to source the materials they need to fuel their production processes. As Zurich Insurance <a href="https://www.zurich.co.uk/news-and-insight/how-does-inflation-impact-the-supply-chain" target="_blank">noted</a>, manufacturing executives often respond to supply shortages by purchasing excess raw materials to bolster their inventories.</p><p>While this might help the few fortunate companies that can secure needed materials offset the impacts of supply shortages, it can have wider, negative consequences for other stakeholders across the supply chain. Procurement surges cause demand to increase further, which puts even more pressure on suppliers to deliver sufficient quantities of raw products.</p><h2>3. Rising interest rates make it harder to access capital</h2><p>The U.S. Federal Reserve has increased interest rates in an effort to tamp demand and stabilize prices. Raising interest rates makes loans and credit lines more expensive, however, making it difficult for suppliers and manufacturers to access capital they need to address the unique economic challenges posed by rising prices.</p><p>Without fast access to cheap capital, businesses have to institute stricter oversight and better management of their cash flows, ensuring budgets are tightened and receivables are properly processed to limit the impact of reduced working capital. If they don't, they might not have the cash reserves to sustain normal business operations.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-81260515517068574972023-01-20T23:10:00.011-05:002023-01-23T12:14:43.041-05:00The solar market's overreliance on Chinese polysilicon is a serious problem<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhHNN62SVZBW7OhmcgzvVJ10pHrmsGa2ErwHMbahTaQ6p-UZAng_sS4qgTXGAU6fDyxl6GAdRZ0FmkXxNauGEQ3k9uC4ZApXTiMGLPdnNYopfT3Cm9t2iASR6G6CZ0ewF0bm7sRrjS_2Vf1v4EpZ2XDZtlJd22QkxcowLByfZtKI2C3GDnv425E0Okr/s500/The-overreliance-on-Chinamade-solar-components-exposes-the-global-market-to-significant-risk_834_40196111_0_7066776_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="334" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhHNN62SVZBW7OhmcgzvVJ10pHrmsGa2ErwHMbahTaQ6p-UZAng_sS4qgTXGAU6fDyxl6GAdRZ0FmkXxNauGEQ3k9uC4ZApXTiMGLPdnNYopfT3Cm9t2iASR6G6CZ0ewF0bm7sRrjS_2Vf1v4EpZ2XDZtlJd22QkxcowLByfZtKI2C3GDnv425E0Okr/s16000/The-overreliance-on-Chinamade-solar-components-exposes-the-global-market-to-significant-risk_834_40196111_0_7066776_500.jpg" /></a></div>As demand for solar panels continues to increase, manufacturers' overreliance on China-produced polysilicon and other raw materials used in the production of solar panels could put the solar supply chain at serious risk.<p></p><p>Geopolitical tensions between the United States and China and the lingering consequences of the COVID-19 pandemic have both caused serious disruptions in the market that have already had downstream consequences for stakeholders throughout the supply chain.</p><h2>China sits atop the world's supply of polysilicon</h2><p>China is the world's leading producer of polysilicon, a raw material of tiny crystals that is used as one of the basic elements in solar panel manufacturing. The polysilicon crystals are melted down to produce ingots, which form the basis of the photovoltaic wafers in finished solar panels.</p><p>In 2021, China <a href="https://iea.blob.core.windows.net/assets/d2ee601d-6b1a-4cd2-a0e8-db02dc64332c/SpecialReportonSolarPVGlobalSupplyChains.pdf" target="_blank">controlled</a> 79% of the world's production of polysilicon, according to research from the International Energy Agency (IEA). Further, the world's leading three producers of polysilicon are presently all <a href="https://www.bernreuter.com/polysilicon/manufacturers/#the-top-ten-ranking-of-the-world-s-largest-polysilicon-manufacturers" target="_blank">based</a> in China, according to Bernreuter Research.</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="The global solar market is highly exposed to geopolitical tensions between the United States and China." class="inlineImage" height="auto" id="14094943" src="https://pictures.brafton.com/x_0_0_0_14094943_800.jpg" width="100%" /><figurecaption>The global solar market is highly exposed to geopolitical tensions between the United States and China.</figurecaption></figure></div><h2>US-China tensions have hit solar markets</h2><p>The inherent challenges of the overconcentration of the world's supply of polysilicon were put on display in 2021, when it was reported that a significant portion of China's polysilicon output — 42%, according to the above IEA report — came from the country's Xinjiang province. Xinjiang has been in international news in recent years due to allegations of forced labor and cultural genocide in the province.</p><p>The United States moved to ban some polysilicon imports from Xinjiang, which seems to have already created bottlenecks. Reuters <a href="https://www.reuters.com/world/china/exclusive-us-blocks-more-than-1000-solar-shipments-over-chinese-slave-labor-2022-11-11/" target="_blank">reported</a> that thousands of shipments of solar energy components have been locked in ports in the wake of the new regulations. These challenges are likely to persist if the United States imposes further restrictions on polysilicon imports originating in Xinjiang.</p><h2>China's polysilicon suppliers have suffered under COVID-Zero</h2><p>A more immediate concern for global solar manufacturers is the lingering effects of the COVID-19 pandemic. China's aggressive approach to curtailing the spread of the virus (termed "COVID-Zero") has forced many polysilicon suppliers to shut down operations (or at least greatly curtail their manufacturing output).</p><p>In a statement, the China Silicon Industry Association <a href="https://mp.weixin.qq.com/s/iJQT2xHZcuSBM9s0rHWidg" target="_blank">reported</a> that the prices for raw materials like polysilicon dropped significantly at the end of the 2022, which puts severe financial pressure on normal business functions, while many manufacturers were also operating well below normal capacity.</p><p>Global solar panel manufacturers' dependence on Chinese markets will continue to disproportionately expose them to disruptions and slowdowns as China implements new measures to fight the virus.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-30247604524633061442023-01-20T23:10:00.010-05:002023-01-23T12:14:22.530-05:00How climate change disrupts supply chains<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjbQitfhpsUCErWMXJndqn20C3JIHrJDi6acn0tWLZaofQQrBuBPUolsU85JOTWVTBR-c7GqgmEvqZ111irJYgoziJl3K6vBgt82xuZ1MIx7ve9t_1nzia1d5RlQxUzKr3qpr0rx197tJ-S2t37s8xxzI8OzwrPe_PXsVTSNVZKbBk75i7wGPBBUsYG/s500/Climate-change-could-make-it-difficult-for-farmers-to-deliver-quality-food-to-the-global-market_834_40196211_0_14106603_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="334" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjbQitfhpsUCErWMXJndqn20C3JIHrJDi6acn0tWLZaofQQrBuBPUolsU85JOTWVTBR-c7GqgmEvqZ111irJYgoziJl3K6vBgt82xuZ1MIx7ve9t_1nzia1d5RlQxUzKr3qpr0rx197tJ-S2t37s8xxzI8OzwrPe_PXsVTSNVZKbBk75i7wGPBBUsYG/s16000/Climate-change-could-make-it-difficult-for-farmers-to-deliver-quality-food-to-the-global-market_834_40196211_0_14106603_500.jpg" /></a></div>Supply chain challenges have dominated international headlines, and much of the focus has been on the fallout from the COVID-19 pandemic and the lingering consequences of the public health crisis.<p></p><p>However, climate change poses a more fundamental threat to global supply chains, as extreme weather events, sea-level rise, unpredictable weather patterns and new compliance regulations all conspire to restrict the ability of suppliers to move goods between markets.</p><h2>Sea-level rise could impact critical transportation hubs</h2><p>Sea-level rise poses serious risk to ports and other transportation centers located on or near major waterways. In a recent report, the National Oceanic and Atmospheric Administration (NOAA) <a href="https://www.climate.gov/news-features/understanding-climate/climate-change-global-sea-level#:~:text=In%20the%202022%20report%2C%20the,above%202000%20levels%20by%202100." target="_blank">projected</a> that sea levels could rise by roughly one foot by 2100, a significant increase that could cause serious damage to transportation infrastructure located near the world's rivers, oceans and lakes.</p><p>As Yale Environment 360 <a href="https://e360.yale.edu/features/how-climate-change-is-disrupting-the-global-supply-chain" target="_blank">points out</a>, ports are critical distribution centers to a much wider (and more complicated) network of suppliers, vendors and manufacturers. When transportation centers near critical waterways are unable to deliver goods beyond their central distribution points, manufacturers located further inland are unable to source the raw materials needed to deliver finished products.</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="Flooding could severely impact the resiliency of global supply chains." class="inlineImage" height="auto" id="14120451" src="https://pictures.brafton.com/x_0_0_0_14120451_800.jpg" width="100%" /><figurecaption>Flooding could severely impact the resiliency of global supply chains.</figurecaption></figure></div><h2>Changing weather patterns might hurt global food supply</h2><p>Many Americans don't realize that much of the food they consume travels along highly integrated supply routes before reaching their plates. In 2021, the United States <a href="https://www.fda.gov/food/importing-food-products-united-states/fda-strategy-safety-imported-food" target="_blank">imported</a> roughly 15% of its food supply, according to the U.S. Food and Drug Administration (FDA).</p><p>Climate change could have serious impacts on the global production of food that might severely disrupt those supply chains. Agriculture depends on the relative predictability of the climate, but as weather patterns like rainfall and temperature <a href="https://climatechange.chicago.gov/climate-impacts/climate-impacts-agriculture-and-food-supply#:~:text=Climate%20change%20can%20disrupt%20food,result%20in%20reduced%20agricultural%20productivity." target="_blank">become</a> increasingly unpredictable, farmers are finding it more difficult to produce a high enough crop yield to meet global demand.</p><p>Furthermore, climate change is disrupting the natural habitats of many plant and animal species, fundamentally altering the ability of livestock and foodstuffs to thrive. Even where the ability to produce at normal levels remains sustainable, food quality could ultimately take a hit as drought, flooding and extended frost periods take their toll.</p><h2>Red tape may place additional burdens on suppliers</h2><p>As the public becomes increasingly concerned about the impact of climate change, government bodies are responding by introducing new compliance regulations to promote more sustainable business practices.</p><p>While effective, these restrictions also create additional bureaucratic hurdles that producers, suppliers and manufacturers must navigate to transport raw materials and bring finished products to market.</p><p>Even as stakeholders adjust to the new regulatory environment and relieve bottlenecks, the added costs of doing business will likely be pushed down to customers, adding further costs to other stakeholders along the supply chain.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-91058504468359748062023-01-17T23:10:00.002-05:002023-01-18T09:49:24.953-05:002022: The year of the drone delivery<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhpChxQHvANYKwJmwLjWGfX_KD0jq4pQb5ZhYWcyCaToj90xRsh6R1IKve05DgbFRZ4mg_qL6tBXWn1zxg-rQWTJbOZET9C5IMS8USvhc7Data4wLvZUm0y8Q7--P6DLgDiinx9jm1ib8G9fqfkTib5xCNe64fWMo9KT5Bkj6pkmlZ6ISh2Xpv8l5ya/s500/Drone-delivery-picked-up-in-frequency-in-2022-_834_40196222_0_14129456_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="375" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhpChxQHvANYKwJmwLjWGfX_KD0jq4pQb5ZhYWcyCaToj90xRsh6R1IKve05DgbFRZ4mg_qL6tBXWn1zxg-rQWTJbOZET9C5IMS8USvhc7Data4wLvZUm0y8Q7--P6DLgDiinx9jm1ib8G9fqfkTib5xCNe64fWMo9KT5Bkj6pkmlZ6ISh2Xpv8l5ya/s16000/Drone-delivery-picked-up-in-frequency-in-2022-_834_40196222_0_14129456_500.jpg" /></a></div>With the supply chain better but not back to normal and carriers overworked by never-ending "next-day deliveries," retailers are turning to drone technology as a huge breakthrough when it comes to order fulfillment. So much so, some believe that 2023 will truly be the year that drones as a means of transportation will truly "take off."<p></p><p>But as it happens, when the retail industry history books are written, 2022 may be remembered as the period in which drone delivery took flight, as two of the country's largest organizations spent the year staking their place as authorized users.</p><p>Last year, Walmart successfully completed thousands of orders that were dropped off via the sky. Indeed, according to a <a href="https://www.businesswire.com/news/home/20230105005929/en/Walmart-Now-Operates-Drone-Delivery-in-7-States-Completes-6000-Drone-Deliveries" target="_blank">company announcement obtained</a> by Supply Chain Dive, the big box retailer performed 6,000 of them in 2022 across seven states, including Arkansas, home to its corporate offices.</p><p>Vik Gopalakrishnan, vice president of innovation and automation for Walmart North America, noted his delight at an historic achievement.</p><p>"I'm incredibly proud of our team for creating the largest drone delivery footprint of any U.S. retailer and providing customers with an incredibly fast – and innovative – option for delivery. We're encouraged by the positive response from customers and look forward to making even more progress in 2023."</p><p>The other states in which drones were deployed for customer delivery were primarily in the South and included Florida, Texas, North Carolina and Virginia. Mountain West customers saw them as well, specifically in Utah and Arizona.</p><p>As one of the largest organizations in the world (all companies, not just retail) and with more than 4,700 brick and mortar locations in the U.S., it may not be too surprising that Walmart leveraged this high-end delivery method given its considerable resources. But Walmart is hardly alone when it comes to drones: Entities like FedEx, UPS, DHL and Domino's Pizza have used drones for delivery either last year or prior to it. Also, even small-business restaurants use drone services for some customers.</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="More drone deliveries are expected in 2023 and beyond." class="inlineImage" height="auto" id="14124507" src="https://pictures.brafton.com/x_0_0_0_14124507_800.jpg" width="100%" /><figurecaption>More drone deliveries are expected in 2023 and beyond. </figurecaption></figure></div><p><strong>Amazon Prime Air introduced in parts of California and Texas</strong><br />Another major player in drone investment is Amazon. The e-commerce giant <a href="https://www.aboutamazon.com/news/transportation/amazon-prime-air-prepares-for-drone-deliveries?ots=1&tag=arstech20-20&linkCode=w50" target="_blank">announced</a> in June 2022 that it received a go for launch from the Federal Aviation Administration after seeking its approval. That green light herald the creation of Prime Air, a delivery service that uses UAVs to make quick (60 minutes or less) drop-offs to customers who are within sufficient range of a warehouse equipped with drone capability. While Prime Air has not been formally rolled out to all Prime subscribers, it is now <a href="https://arstechnica.com/gadgets/2022/12/amazon-begins-drone-deliveries-in-california-and-texas/" target="_blank">available for use in test locations</a>. These include Lockeford, California and College Station, Texas, according to reporting from ARS Technica.</p><p>Speaking to KTXL, a FOX TV affiliate in Sacramento, Amazon Air Spokesperson Natalie Bank <a href="https://fox40.com/news/local-news/san-joaquin-county/amazon-begins-drone-deliveries-lockeford-college-station/" target="_blank">said these parts of the country</a> will be the first to experience a service the company believes will soon be more widely available.</p><p>"We are starting in these communities and will gradually expand deliveries to more customers over time," Bank said.</p><p>Experts say drones for now will only be used to deliver smaller items, such as certain types of food, home supplies and paper goods. According to Walmart, the company sells over 20,000 items that are drone drop-off eligible, each weighing 10 pounds or less.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-34514854447443895202023-01-13T23:10:00.002-05:002023-01-16T09:37:49.385-05:003 predictions about warehouse automation in 2023<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi9UsOkwLUCGLH_idCaO05V35FJQy-BKDIuYPTtEJZbcpp4ApuQVMMyJRj4HdYqrg3fmR4sZSrJPZn53Vfz2uf78aLNeoben3LraLEUSSxUFfUdtnC39Rq1en8K1UXl7E4L5QW5_EiECo80ox3O16AdVyeWv0iDuRGRA28SVqm3G6eWQ1DKnr2XmsV1/s500/Warehouse-automation-will-be-heavily-involved-in-distribution-centers-in-2023-_834_40196226_0_14135245_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="334" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi9UsOkwLUCGLH_idCaO05V35FJQy-BKDIuYPTtEJZbcpp4ApuQVMMyJRj4HdYqrg3fmR4sZSrJPZn53Vfz2uf78aLNeoben3LraLEUSSxUFfUdtnC39Rq1en8K1UXl7E4L5QW5_EiECo80ox3O16AdVyeWv0iDuRGRA28SVqm3G6eWQ1DKnr2XmsV1/s16000/Warehouse-automation-will-be-heavily-involved-in-distribution-centers-in-2023-_834_40196226_0_14135245_500.jpg" /></a></div>In one form or another, virtually all industries are utilizing automation to facilitate their work processes for greater efficiency, speed and accuracy and to lower costs. Chief among those users are retailers, leveraging the technology in their warehouses and distribution centers to improve the flow of goods in and out of their facilities and to save on costs by minimizing downtime and errors. From conveyor belt systems to robotic arms to material handling equipment for picking and packing, warehouse automation is no longer the exception — it's the rule, particularly among major brick-and-mortar and e-commerce retailers.<p></p><p>Given its ubiquity, a few questions arise: What will warehouse automation look like in 2023? Will warehouse occupancy grow to accommodate the infrastructure? How will it address business owners' supply chain challenges? Here are a few predictions:</p><p><strong>1. Surge in robots-as-a-service usage</strong><br />Robots as a service, or RaaS, refers to the delivery of robotic solutions on a subscription or pay-per-use basis. Similar to software as a service (SaaS), RaaS allows businesses to use robots without having to purchase and maintain them.</p><p>According to Supply Chain Brain, due to the ongoing labor shortage, RaaS will likely <a href="https://www.supplychainbrain.com/blogs/1-think-tank/post/36172-the-future-of-warehouse-automation-what-to-expect-in-2023" target="_blank">gain more traction</a> in the months ahead to plug unfilled roles that would normally be held by individuals.</p><p>Moving forward, employers will need to make decisions on their paths forward by asking themselves tough questions. Why has the labor shortage persisted as long as it has? What inducements, beyond better pay, will encourage more people to apply? How much money are they saving through RaaS, and if so, does it make sense to expand their use? These are all key questions that will chart the path forward for organization.</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="RaaS will likely expand in warehouses over the coming months as warehouses grapple with labor shortages." class="inlineImage" height="auto" id="14110182" src="https://pictures.brafton.com/x_0_0_0_14110182_800.jpg" width="100%" /><figurecaption>RaaS will likely expand in warehouses over the coming months as warehouses grapple with labor shortages. </figurecaption></figure></div><p><strong>2. Humans will become more relevant, not less</strong><br />In light of the fact that automation continuous to flourish — inside and outside of warehouse settings — some believe that humans are on the cusp of being fully replaced, a feeling they've had for a while. Several years ago, for example, <a href="https://news.gallup.com/poll/210728/one-four-workers-say-technology-eliminate-job.aspx" target="_blank">over a quarter of respondents</a> in a Gallup poll believed they'd be out of a job within 20 years because of automation. </p><p>Experts say otherwise. That's because warehouse automation needs to be overseen by human beings to guard against malfunctions, for maintenance and to ensure the equipment starts and stops when its supposed to. Machines are also designed to perform more repetitive tasks rather than those that require contemplation and critical thinking. Organizations that rely on warehouse automation — such as retailers and logistics companies — are still actively recruiting people, despite their increased usage of robotics.</p><p><strong>3. Dip in warehouse demand</strong><br />While warehouse automation may be expanding, demand for warehouse space is slowing, largely due to the dramatic increase in interest rates fueled by inflation and actions of the Federal Reserve. That's expected to continue into 2023 as mortgage rates tick higher.</p><p>According to Cushman & Wakefield data <a href="https://www.supplychaindive.com/news/warehouse-demand-slows-fulfillment-amazon/639952/" target="_blank">obtained by</a> Supply Chain Dive, the amount of occupied warehouse space fell over 9% in the fourth quarter compared to the third. The commercial real estate firm added that warehouse supply will push higher in 2023 because demand is declining at the same time as contractors are completing construction.</p><p>Organizations are poised to continue investing in warehouse automation, but in spaces they already occupy.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-63493219496893630802023-01-12T23:10:00.002-05:002023-01-13T08:37:05.040-05:00Hiring remains challenging for most manufacturers<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhHDpb8bbScIWESc44CFrDZPE2Vt_EaSEuzfxqnO8bKi3GRIg1B6HWJ-qPtVhFTjr5KHdicD1REUcFHrQfzaw6OGGX50dNJCiE9myzKfNznjeABuyd9UXiJDr71KdmQ-Pr9ZmUjuTuhLTZ_20v9lJiG60zjnEFPRPOHXotxDDd9vwFKyGg8DP9VFDSX/s500/Manufacturers-are-still-struggling-to-fill-open-roles-despite-their-raising-wages-_834_40196207_0_14069000_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="334" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhHDpb8bbScIWESc44CFrDZPE2Vt_EaSEuzfxqnO8bKi3GRIg1B6HWJ-qPtVhFTjr5KHdicD1REUcFHrQfzaw6OGGX50dNJCiE9myzKfNznjeABuyd9UXiJDr71KdmQ-Pr9ZmUjuTuhLTZ_20v9lJiG60zjnEFPRPOHXotxDDd9vwFKyGg8DP9VFDSX/s16000/Manufacturers-are-still-struggling-to-fill-open-roles-despite-their-raising-wages-_834_40196207_0_14069000_500.jpg" /></a></div>When history is written, the current recession may go down as one of the more unusual ones for the United States' economy. Unlike the Great Recession in the late 2000s, when hiring fell virtually across the board and the unemployment rate grew in response, many industries are still feverishly seeking job applicants, which has kept the national jobless rate quite low. But other major employment sectors — such as IT and finance — are downsizing due to poor earnings and diminished demand.<p></p><p>An industry that's in the former category is manufacturing, as a new report shows the overwhelming majority of employers in the sector are experiencing a workforce shortage.</p><p>More than <a href="https://www.nam.org/wp-content/uploads/2022/09/Manufacturers_Third_Quarter_Outlook_Survey_September_2022.pdf" target="_blank">3 in 4 manufacturing companies</a> are experiencing problems with hiring and retaining skilled workers, according to a newly released survey from the National Association of Manufacturers (NAR). With 76% of polled respondents indicating as much, staffing shortages were second only to supply chain disruptions as producers' most common challenge.</p><p>Chad Moutray, the NAR's chief economist, pointed out that hiring and maintaining staff have been persistent pain points for producers for quite some time now.</p><p>"Companies continue to have workforce issues," Moutray explained, <a href="https://www.supplychaindive.com/news/manufacturing-labor-shortages/639366/" target="_blank">as reported by</a> Supply Chain Dive. "Some are raising wages and still are having difficulties finding anybody, which is holding back their ability to expand and stay productive."</p><p>What's also impeding their output is retention. According to the U.S. Chamber of Commerce, as of October, manufacturers have the <a href="https://www.uschamber.com/workforce/understanding-americas-labor-shortage-the-most-impacted-industries" target="_blank">highest quit rate of all industries at 5.5%</a>, with wholesale and retail trade in a distant second (3.2%). As a result, 40% of job openings in manufacturing are unfilled, U.S. Chamber of Commerce data also shows.</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="Hiring woes continue to plague manufacturers." class="inlineImage" height="auto" id="14106312" src="https://pictures.brafton.com/x_0_0_0_14106312_800.jpg" width="100%" /><figurecaption>Hiring woes continue to plague manufacturers. </figurecaption></figure></div><p>Similar to other industries, when it comes to insufficient employment, the pandemic was the tipping point. Many producers were already experiencing problems with hiring and then the measures designed to curb the transmissibility of COVID-19 forced some employers to cut their payrolls. But with those same manufacturers now hiring again, workers remain on the sidelines, despite business owners raising wages to attract them back. Producers expect to keep doing so for the foreseeable future, according to the NAM poll.</p><p><strong>It isn't all about the money</strong><br />More money can't be their only strategy, according to Paul Wellener, vice chair of industrial products at Deloitte. Wellener told Supply Chain Dive that other incentives individuals seek include flexible work arrangements and opportunities to learn new skill sets through training. Training has been more of a focus for manufacturers of late but also even before the pandemic. In 2019, for example, they <a href="https://www.themanufacturinginstitute.org/press-releases/new-survey-shows-u-s-manufacturers-spending-billions-to-close-skills-gap/" target="_blank">collectively spent $26.2 billion</a> on internal and external training programs, according to NAM figures</p><p>Manufacturers are also increasingly embracing remote and hybrid work environments. As a Gallup poll in 2021 revealed, <a href="https://news.gallup.com/poll/355907/remote-work-persisting-trending-permanent.aspx">approximately 9 in 10 respondents</a> at the time said they wanted to continue taking advantage of the ability to work from home when the lockdown measures were fully lifted. A majority said hybrid was their preferred work environment.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-54905604241860312023-01-09T23:10:00.002-05:002023-01-10T08:32:10.682-05:00Extreme heat poised to deplete manufacturing output, report warns<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjnxpPYd-uXF-5aRQI-_duCyF7dz2RdOl3sq15MZ-V0kd_3QoxOy0piW7iUAV33Imc125WpkwVBiEnb7tm6liGpYl8cJYcz4khZaADaHhitItsDE16qYjAPKxHSIp2_5iSqYY2W8EpVJHVMvxBkd65M8BZRZ1_SW1Up2kL8hw8SzV62ndXILHWdkiUh/s500/A-new-report-from-the-UN-outlines-how-extreme-heat-may-impair-the-supply-chain--_834_40196201_0_14120452_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="334" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjnxpPYd-uXF-5aRQI-_duCyF7dz2RdOl3sq15MZ-V0kd_3QoxOy0piW7iUAV33Imc125WpkwVBiEnb7tm6liGpYl8cJYcz4khZaADaHhitItsDE16qYjAPKxHSIp2_5iSqYY2W8EpVJHVMvxBkd65M8BZRZ1_SW1Up2kL8hw8SzV62ndXILHWdkiUh/s16000/A-new-report-from-the-UN-outlines-how-extreme-heat-may-impair-the-supply-chain--_834_40196201_0_14120452_500.jpg" /></a></div>From far-reaching wildfires in states that typically don't get them in the summer to a spike in Category 4 hurricanes in the fall, the devastating repercussions of climate change play out across the country on a regular basis. While weather as a rule is variable, evidenced by the natural changes in air temperatures from seasonality, the data proves that the planet's temperature is on a steady track higher. Just this past November, for example, the earth logged its <a href="https://www.noaa.gov/news/earth-saw-its-9th-warmest-november-in-143-years" target="_blank">ninth warmest November on record</a>, according to the National Oceanic and Atmospheric Administration. Given weather phenomena affect human behavior, it's fair to say that climate change has both a direct and indirect impact on the supply chain. And according to a new threat assessment, manufacturers may be in the eye of the storm, with increasing heat impeding their productivity.<p></p><p>In a <a href="https://hdr.undp.org/data-center/human-climate-horizons-data-and-insights-platform" target="_blank">report released</a> by the United Nations, if the earth temperature's keeps rising at its present pace, then the average U.S. worker in product-based industries will lose approximately 0.4% hours of productivity over the course of a full year. This estimates comes courtesy of the UN's Human Climate Horizons Project, an initiative that offers insight on how climate change may impede people's ability to flourish.</p><p>Given there are over 8,700 hours in the typical calendar year, a four-tenths of a percent dip in productivity may seem infinitesimal but as climate expert Hannah Hess <a href="https://www.supplychaindive.com/news/climate-change-extreme-weather-heat-flooding-manufacturing-industry-risk/639363/?utm_source=Sailthru&utm_medium=email&utm_campaign=Issue:%202023-01-04%20Supply%20Chain%20Dive%20%5Bissue:47063%5D&utm_term=Supply%20Chain%20Dive" target="_blank">told</a> Supply Chain Dive, that's a significant decline in a country of over 350 million people in the world's largest economy.</p><p>"Think of how your workforce responds when it's super hot outside," Hess explained. "Here's how those days are going to multiply over the course of the century. And here's how that is also projected to have a larger and larger effect over time on your workforce."</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="A new report from the U.N. warns about the effect of extreme heat on productivity." class="inlineImage" height="auto" id="14105410" src="https://pictures.brafton.com/x_0_0_0_14105410_800.jpg" width="100%" /><figurecaption>A new report from the UN warns about the effect of extreme heat on productivity. </figurecaption></figure></div><p><strong>Cold snap leads to delivery delays</strong><br />It isn't just oppressive warmth that can reduce output; extreme cold does as well, which many scientists also attribute to climate change. In the days just before Christmas — typically the busiest time of the year for manufacturers, retailers and logistics entities — a polar vortex swept over much of the country, bringing with it freezing temperatures and driving snow. As a result, many recipients expecting packages didn't get them in the windows they were expected to arrive. Indeed, in the Midwest, <a href="https://www.supplychaindive.com/news/winter-weather-stymied-deliveries-christmas-peak-2022-project44/639645/" target="_blank">on-time delivery performance was just 49% on Dec. 23</a> and a mere 37% on Christmas Eve, according to project44 data obtained by Supply Chain Dive. Airlines were also impacted by the massive snowstorm, causing thousands of delays and flight cancelations.</p><p>The UN report also warned of an uptick in flooding fueled by climate change. Flooding is unique among weather-related events, in that every part of the world is potentially vulnerable to it.</p><p>Experts warn the inevitability of the climate crisis necessitates manufacturers to adapt and do everything they can to ramp up production, such as through strategic investments and added staffing. Hess also urged business owners to "do your part" by reducing carbon emissions, a major contributor to climate change.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-1680097785746004042023-01-06T23:10:00.002-05:002023-01-09T09:26:53.345-05:00More EVs to be used for mail carriers' routes<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi0P0Gej0--sfrrRAvCHIaquWh_YR7vOKJG4ZqhjepHGnuGKIuGfhFEa0pkskvXwEaHHju-iVBef-tbdpprcrWuevWfYWr9rVIHq4NxAwli7iOp4plwUr5vDidPWp7eQOyAbyYhQ_I3S33RdzJaxaJ4vYrCWJ-yt3099812wYCczstRis_eCiwff1YS/s500/The-USPS-will-purchase-and-deploy-tens-of-thousands-of-EV-over-the-next-several-years-_834_40196190_0_14099433_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="500" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi0P0Gej0--sfrrRAvCHIaquWh_YR7vOKJG4ZqhjepHGnuGKIuGfhFEa0pkskvXwEaHHju-iVBef-tbdpprcrWuevWfYWr9rVIHq4NxAwli7iOp4plwUr5vDidPWp7eQOyAbyYhQ_I3S33RdzJaxaJ4vYrCWJ-yt3099812wYCczstRis_eCiwff1YS/s16000/The-USPS-will-purchase-and-deploy-tens-of-thousands-of-EV-over-the-next-several-years-_834_40196190_0_14099433_500.jpg" /></a></div>A well-oiled supply chain is heavily dependent on energy, and as much of the country pivots away from fossil fuels in favor of cleaner, more sustainable forms for its various transportation needs, the U.S. Postal Service (USPS) has announced its intentions to phase out its gas-powered service vehicles in favor of those that operate on electricity. If all goes according to plan, a substantial portion of its newly renovated fleet could hit the streets by the end of the year. <p></p><p>Thanks in part to the Inflation Reduction Act and Bipartisan Infrastructure Law, the USPS is <a href="https://about.usps.com/newsroom/national-releases/2022/1220-usps-intends-to-deploy-over-66000-electric-vehicles-by-2028.htm" target="_blank">prepared to spend upwards of $9.6 billion</a> on hybrid and all-electric automobiles, or what the USPS is referring to as "Next Generation Delivery Vehicles" (NGDV). These funds will pay for the manufacture and delivery of at least 60,000 service vehicles, the overwhelming majority of which will be all electric. With the goal of obtaining 106,000 all-new service vehicles overall, these purpose-built vehicles may eventually entirely replace the USPS's current fleet of 220,000 gas-powered vehicles. At a bare minimum, the USPS intends at least 40% of its carriers to be using battery electric when the phased transition is complete in 2028.</p><p>USPS Postmaster General Louis DeJoy said this initiative represents a significant milestone for the Postal Service as well as for Americans who rely on an efficient postal system for their letter and package delivery needs.</p><p>"We have a statutory requirement to deliver mail and packages to 163 million addresses six days per week and to cover our costs in doing so – that is our mission," DeJoy said in a press release. "As I have said in the past, if we can achieve those objectives in a more environmentally responsible way, we will do so."</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="The USPS' ubiquitous mail trucks will soon be replaced by next-generation delivery service vehicles." class="inlineImage" height="auto" id="14090018" src="https://pictures.brafton.com/x_0_0_0_14090018_800.jpg" width="100%" /><figurecaption>The USPS' ubiquitous mail trucks will soon be replaced by next-generation delivery service vehicles. </figurecaption></figure></div><p><strong>$3 million to come from legislation</strong><br />Roughly one-third of the spending for the NGDVs will derive from the Inflation Reduction Act, which was passed by Congress and signed into law by President Joe Biden in August 2022. While much of that bill focused on lowering prescription drug prices for consumers, it also aims to increase the nation's domestic energy production and manufacturing without contributing to carbon emissions.</p><p>Additionally, the <a href="https://www.whitehouse.gov/bipartisan-infrastructure-law/#electricvehicle" target="_blank">Infrastructure Investment and Jobs Act</a> — which was passed in late 2021— is also expected to support the energizing requirements as more EVs — used by the USPS and ordinary Americans — hit the road. For example, this bill earmarks $7.5 billion for a broader network of EV charging stations, with the goal of reaching 500,000 within the next decade.</p><p>"The $3 billion provided by Congress has significantly reduced the risk associated with accelerating the implementation of a nationwide infrastructure necessary to electrify our delivery fleet," DeJoy added.</p><p>The 40% commitment represents a substantial shift from the USPS's initial intentions. In February 2022, the agency said that 10% of its fleet would be battery powered. After receiving pushback from lawmakers as well as environmental advocates, the USPS upped it to 40% five months later.</p><p>While it's unclear the exact date by which the USPS will begin using more BEVs, it says that both homeowners and business owners should anticipate seeing more of them nearer to the end of 2023.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-6317091141118495302022-12-28T23:10:00.002-05:002023-01-03T08:39:18.659-05:00Seeking new paths, shippers look to East Coast<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhIwKMqjrm7CRYvNlS4Y4k1BgQVUBDQcDv0VRV4JPjkRe_IMj6dP_6W4mlNWgCDfypDahZo47Y21_GSO5rNev-lm7g4mdgoym7QPEImPJ9FALqm9jfF9qhyCHdaM-vnq4Sv5mFKgNZW_ahG5_jFVwQRbkhGb9H6dzPumi-8yV1MBGjdABKnDJVrkXHU/s500/Slowdowns-at-West-Coast-ports-are-making-shippers-consider-diversifying-their-supply-chains_834_40195855_0_14070700_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="334" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhIwKMqjrm7CRYvNlS4Y4k1BgQVUBDQcDv0VRV4JPjkRe_IMj6dP_6W4mlNWgCDfypDahZo47Y21_GSO5rNev-lm7g4mdgoym7QPEImPJ9FALqm9jfF9qhyCHdaM-vnq4Sv5mFKgNZW_ahG5_jFVwQRbkhGb9H6dzPumi-8yV1MBGjdABKnDJVrkXHU/s16000/Slowdowns-at-West-Coast-ports-are-making-shippers-consider-diversifying-their-supply-chains_834_40195855_0_14070700_500.jpg" /></a></div>Where do the goods customers order come from? In the past, U.S. stores have largely been stocked by supply chains that flow through the West Coast. However, the early days of the COVID-19 pandemic highlighted some of the weaknesses of the existing system.<p></p><p>Delays at ports have been some of the most significant and most persistent supply chain stories throughout the pandemic. While administrative efforts have helped clear the backlogs, shippers and the organizations that rely on them will remember what it felt like to have goods languishing at the Ports of Los Angeles and Long Beach.</p><p>Shipping organizations are realizing that port infrastructure represents a potential bottleneck in their operations — the question is what they will do about it.</p><h2>Companies look east</h2><p>The Wall Street Journal recently reported on some of the <a href="https://www.wsj.com/articles/california-long-ruled-u-s-shipping-importers-are-drifting-east-11670648425" target="_blank">methods companies are using to diversify their supply chains</a> and make themselves less vulnerable to congestion at ports. Namely, they are looking to East Coast ports such as The Port of New York And New Jersey.</p><p>The WSJ explained that companies such as Abercrombie & Fitch have begun to move a larger percentage of their goods through the East Coast. While the breakdown was previously 90% west and 10% east, the East Coast now accounts for 25% of the brand's imports.</p><p>The factors behind such decisions go beyond the desire to avoid further slowdowns in Southern California. The Panama Canal has widened in recent years, helping shipping to the East Coast, while companies have begun to import more goods from Europe, as opposed to relying so heavily on China.</p><p>Another company that has shifted east is Newell, the brand behind diverse products such as Sharpie markers and the items from Yankee Candle. The company, seeking to reach the eastern U.S., has opened a Pennsylvania distribution center and intended to add another in North Carolina.</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="Cranes unload cargo from a ship." class="inlineImage" height="auto" id="14073139" src="https://pictures.brafton.com/x_0_0_0_14073139_800.jpg" width="100%" /><figurecaption>Companies are rethinking their import shipping strategies.</figurecaption></figure></div><h2>Backlogs: Not just for the West Coast</h2><p>Of course, moving operations away from the ports that suffered backlogs in 2022 is not a cure-all for shippers. As of mid-December 2022, the Port of Savannah in Georgia was <a href="https://maritime-executive.com/article/savannah-expects-to-clear-containership-backlog-in-coming-weeks" target="_blank">struggling to clear a queue of its own</a>, according to Maritime Executive.</p><p>With Savannah seeing the same increased activity as other major ports in 2022, it's perhaps inevitable that a backlog would take shape at the southern port. Diversifying points of entry for imports is an important way to add strength and resilience to supply chains, but organizations and port authorities will have to work together to make the new operations work.</p><p>Maritime Executive reported that administrators are hoping to solve the problem with a twofold approach. In the short term, the port will get ships moving as container volume normalizes, while in the long term, Savannah will add two large berths and additional container yards in areas now used for breakbulk.</p><p>Increased volume is a factor that affected ports around the U.S. in 2022, for better and for worse. Looking to 2023, shippers are naturally considering new ways to mitigate the disruption they felt throughout the year.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-15735993193045118092022-12-22T23:10:00.002-05:002023-01-03T08:39:48.218-05:00National grocer to stop buying Maine lobster<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiIKO4mg6D2ASiI2NzuTqWIacgnSabWExT_V0wD9hfqc0IBuI-L4sgy7tHdkMdpmTOzakRk2CSqIqNgZ3Xlk-aG0v0O-Kesk_MU-VpljwYRKbtjFaqSqsUxx9lueH28Ac82eyVoZfnqHyWsCmlWVwbuOfODhqx0q9pP_1HrJqrehj70prsed9JTJGwP/s500/Lobster-is-a-major-source-of-revenue-for-Maines-economy-_834_40195971_0_14048079_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="332" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiIKO4mg6D2ASiI2NzuTqWIacgnSabWExT_V0wD9hfqc0IBuI-L4sgy7tHdkMdpmTOzakRk2CSqIqNgZ3Xlk-aG0v0O-Kesk_MU-VpljwYRKbtjFaqSqsUxx9lueH28Ac82eyVoZfnqHyWsCmlWVwbuOfODhqx0q9pP_1HrJqrehj70prsed9JTJGwP/s16000/Lobster-is-a-major-source-of-revenue-for-Maines-economy-_834_40195971_0_14048079_500.jpg" /></a></div>Maine's official nickname may be the Pine Tree State, but given its proximity to the coast and its abundance of sea life, it might as well be called the Lobster State. Employing an estimated 5,600 independent lobstermen, <a href="https://lobsterfrommaine.com/article/maine-lobster-fact-sheet/" target="_blank">harvesting over 100 million pounds</a> of the crustacean annually and contributing over $1 billion to the state's economy per year, according to industry data, the nation's lobster supply chain largely runs through Maine. <p></p><p>Despite its prominence, one of America's largest grocery chains will stop buying lobster caught off Maine waters until further notice.</p><p>Whole Foods Market told Grocery Dive that it <a href="https://www.supplychaindive.com/news/Whole-Foods-pauses-purchasing-of-Maine-lobster/637718/" target="_blank">will "pause purchasing" Maine lobster</a> upon receiving word that the Marine Stewardship Council has suspended the state's MSC certificate.</p><p>Named after the Marine Stewardship Council, MSC certification is a status symbol and a designation that tells buyers — such as grocers or fish markets — that fisheries support and implement sustainable fishing practices. To obtain this certification, fisheries must demonstrate how they're adhering to the sustainability protocols established by the United Nations Food and Agriculture Organization, such as by maintaining a clear chain of custody, guarding against overfishing and implementing other best practices.</p><p>But MRAG Americas, the body charged with monitoring fisheries' conformance with the MSC Fishery Standard, has stripped Maine of its certification due to a change in third-party verifications and ratings on the part of MSC as well as the Monterey Bay Aquarium Seafood Watch program.</p><p>In a statement obtained by Grocery Dive, a Whole Foods Market spokesperson said the suspension on buying from Maine is primarily due to the company's commitment to sustainability.</p><p>"[W]e only sell wild-caught seafood from fisheries that are certified by the Marine Stewardship Council (MSC) or rated either 'Green' or 'Yellow' by the MBA Seafood Watch program," the spokesperson emphasized. "These third-party verifications and ratings are critical to maintaining the integrity of our standards for all wild-caught seafood found in our seafood department."</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="The right whale is an endangered species, with only 350 believed to be remaining in the world." class="inlineImage" height="auto" id="14111138" src="https://pictures.brafton.com/x_0_0_0_14111138_800.jpg" width="100%" /><figurecaption>The right whale is an endangered species, with only 350 believed to be remaining. </figurecaption></figure></div><p><strong>Fishing practices called into question</strong><br />The impetus for pulling Maine's certification, aside from the ratings change, appears to be related to certain fishing practices off the Gulf of Maine that may be compromising right whale migration patterns. An endangered species, the right whale is one of the rarest on Earth, <a href="https://www.fisheries.noaa.gov/species/north-atlantic-right-whale#:~:text=About%20the%20Species&text=The%20North%20Atlantic%20right%20whale,are%20fewer%20than%20350%20remaining." target="_blank">with an estimated 350 left in existence</a>, according to the National Oceanic and Atmospheric Administration. This past September, MRAG Americas determined from an investigation that Maine was no longer in compliance with the MSC Fishery Standard, which is designed to protect the species and other endangered ocean life. </p><p>This marks the second time in two years that Maine has lost its certification and over a similar issue.</p><p>Maine officials, including Governor Janet Mills, <a href="https://www.maine.gov/governor/mills/news/maine-delegation-and-governor-mills-voice-disappointment-urge-national-retailers-continue" target="_blank">recently expressed their objection</a> to the suspension, noting that not a single right whale has died in the past 150 years due to Maine lobster gear or vessels.</p><p>"Despite this, the Marine Stewardship Council, with retailers following suit, wrongly and blindly decided to follow the recommendations of misguided environmental groups rather than science," Mills said in a statement, along with Maine Senators Susan Collins and Angus King.</p><p>Lawmakers went on to urge both Whole Foods Market and the MSC to reconsider their actions.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-61490420824816502182022-12-21T23:10:00.003-05:002022-12-22T12:52:05.478-05:00Production of cardiac device slowed by raw materials shortage<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhMcrrs9UhbNU0p6fT0t8oqXJV29xi1be-P24jXZzLc-nSOpT9LmBFKsu2apBnVUNNSytVXgLTPPdyBh2YNiV7IEOtbZxLTG16LyPLW82V32XslJ5_QPpOFY_TGMonfA6Jd6otUDvyfCX-mntF_NhYjWJoWrbUhqZ863PRgaVc7ZHw8N_qZvYGBev8B/s500/Cardiologists-and-heart-patients-are-feeling-the-effects-of-a-broken-supply-chain-_834_40195972_0_14087826_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="340" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhMcrrs9UhbNU0p6fT0t8oqXJV29xi1be-P24jXZzLc-nSOpT9LmBFKsu2apBnVUNNSytVXgLTPPdyBh2YNiV7IEOtbZxLTG16LyPLW82V32XslJ5_QPpOFY_TGMonfA6Jd6otUDvyfCX-mntF_NhYjWJoWrbUhqZ863PRgaVc7ZHw8N_qZvYGBev8B/s16000/Cardiologists-and-heart-patients-are-feeling-the-effects-of-a-broken-supply-chain-_834_40195972_0_14087826_500.jpg" /></a></div>From personal protective equipment like N-95 face masks to vitally important medical devices like ventilators, product shortages were a common occurrence throughout the pandemic. While supply chain issues for some essentials have since been resolved, other shortages remain problematic for hospitals and physicians, as well as patients throughout the country. The devices that remain rare to this day include external defibrillators, chest drains, suction canisters and a number of dialysis products.<p></p><p>It appears that yet another medical device is quite scarce and it may be due to a deficiency of certain raw materials that are used in the manufacturing process.</p><p>The Food and Drug Administration <a href="https://www.fda.gov/medical-devices/coronavirus-covid-19-and-medical-devices/medical-device-shortages-during-covid-19-public-health-emergency#shortage" target="_blank">maintains a regularly updated list</a> of medical devices that are in limited quantity. Its <a href="https://www.fda.gov/medical-devices/letters-health-care-providers/getinge-maquetdatascope-intra-aortic-balloon-pump-iabp-shortage-letter-health-care-providers?utm_medium=email&utm_source=govdelivery" target="_blank">latest entry</a> concerns intra-aortic balloon pump devices, otherwise known as IABP. Made by the manufacturer Getinge, a long-standing medical technology company headquartered in Sweden, IABP devices are primarily used by cardiologists to help patients deal with health effects impacting the normal function of their hearts by providing temporary support to the ventricles. The ventricles serve as a muscular chamber and help pump blood from the heart out into the rest of the body's cells.</p><p>As with most medical devices, the IABP requires a variety of supplementary materials to be assembled and made ready for use. That's why in November, Getinge informed healthcare providers of how <a href="https://www2.getinge.com/dam/hospital/documents/english/mca00001735_getinge_cardiac_assist_product_shortage_notification_final_no_response_form-en-global.pdf" target="_blank">broader supply chain challenges</a> were compromising its ability to produce items and meet orders.</p><p>"You should know that ongoing supply chain issues have significantly impacted our ability to build intra-aortic balloon pumps (IABPs), intra-aortic balloon catheters (IABs) and spare parts due to raw material shortages," wrote Jennifer Paradise, a Getinge product representative, in a letter obtained by Medtech Dive.</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="Supply chain issues are affecting the availability of heart-related medical devices." class="inlineImage" height="auto" id="14121478" src="https://pictures.brafton.com/x_0_0_0_14121478_800.jpg" width="100%" /><figurecaption>Supply chain issues are affecting the availability of heart-related medical devices. </figurecaption></figure></div><p><strong>Combination of factors plaguing production</strong><br />While the letter doesn't state which specific raw material is compromising the manufacturer's ability to produce at a higher volume, it does cite other factors contributing to the issue. These include higher-than-normal demand for the device and the limited availability of a "component, part or accessory of the device." </p><p>The missive also did not predict when Getinge would be able to ramp up production but did point out that it continues to fabricate the IABPs, just not at the pace it would like to in order to meet the growth in demand. The FDA, meanwhile, says that the shortage will persist into next year.<br /><br />As for potential workarounds, Paradise noted that it would provide guidance for proper maintenance to ensure that IABPs will operate properly and avoid the potential of malfunction. The FDA made mention of what it's doing to improve the situation on its website, adding that it will continue to monitor the latest development and will report any updates on an as-needed basis.</p><p>This isn't the first time Getinge's proprietary device has made headlines. Last year, the FDA <a href="https://www.fda.gov/medical-devices/medical-device-recalls/getingedatascopemaquet-recalls-cardiosave-hybrid-and-cardiosave-rescue-intra-aortic-balloon-pump?utm_medium=email&utm_source=govdelivery" target="_blank">issued a recall</a> for intra-aortic balloon pumps after being advised by the Swedish manufacturer that the battery could fail, compromising the safety and welfare of patients. At the time, the recall affected over 4,300 devices in the U.S. that were manufactured sometime between early March and late October 2021.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-16661350894097150072022-12-20T23:10:00.002-05:002022-12-21T09:02:05.498-05:00How automated fulfillment delivers for your business<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhoz9I_ctwkgGYVmMK_2ejpXdH1rzI6GjB76YJeLDEOZ2IFuoqyH2XEHpvLACf9gYyRMdWQdkrG-_hcO4b9vXsaTZzex4mj3_bKqssKHzjdeTOirzouJ0jddeAcGkqhSnOQtKvVn7PXsvYMSQvhsSy6tL5jQC-yavOR24qokcO8duk0WPk09YJ2XE8d/s500/Automated-fulfillment-technology-is-expediting-warehouse-work-processes-for-small-and-large-organizations-alike-_834_40196039_0_14006003_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="333" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhoz9I_ctwkgGYVmMK_2ejpXdH1rzI6GjB76YJeLDEOZ2IFuoqyH2XEHpvLACf9gYyRMdWQdkrG-_hcO4b9vXsaTZzex4mj3_bKqssKHzjdeTOirzouJ0jddeAcGkqhSnOQtKvVn7PXsvYMSQvhsSy6tL5jQC-yavOR24qokcO8duk0WPk09YJ2XE8d/s16000/Automated-fulfillment-technology-is-expediting-warehouse-work-processes-for-small-and-large-organizations-alike-_834_40196039_0_14006003_500.jpg" /></a></div>It's difficult to pinpoint the most important department when it comes to everything that goes on in the warehouse but a case can be made for fulfillment. During the pandemic, when lockdown measures created staffing shortages just as demand for consumer goods skyrocketed, fulfillment was overwhelmed with orders, creating shipping delays that persisted for months.<p></p><p>Automated fulfillment is helping to improve operations and right size inventories. Here is a brief breakdown of what automated fulfillment is, what businesses are using it for and the benefits of the strategy that have taken the related technology to new heights of utilization and popularity.</p><p><strong>What is automated fulfillment?</strong><br />As its title suggests, automated fulfillment refers to the implementation of technologies that automate fulfillment. When a warehouse receives an order from a customer, a multitude of actions take place for the desired item to be selected, handled, packaged, placed and shipped to the buyer. Instead of each of these processes being done manually, automated fulfillment leverages technology to perform them all faster, more accurately and with greater efficiency. Some of these technologies may include — but aren't limited to — robotics, conveyor belts, rollers, optimized sortation systems, pickers, mechanized arms and much more.</p><p><strong>What companies are using automated fulfillment?</strong><br />From Amazon to Walmart, e-commerce and big box retailers are among the most well-known users of automated fulfillment, each of them using the technology to varying degrees. Some organizations have dipped their toes in the automated fulfillment waters, testing some of the systems out first before investing in expansion.</p><p>A company that is in the midst of expanding its automated fulfillment network is Chewy, an e-commerce retailer specializing in pet supplies. After opening its first automated fulfillment center in Pennsylvania in late 2020 — the same year as the COVID-19 outbreak — Chewy's chief executive officer announced the company will grow it further, <a href="https://www.supplychaindive.com/news/chewys-automated-fulfillment-centers-reduce-shipping-costs-Q3/638548/" target="_blank">as reported by</a> Supply Chain Dive.</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="Automated fulfillment resources help to hasten delivery while lowering costs." class="inlineImage" height="auto" id="14005775" src="https://pictures.brafton.com/x_0_0_0_14005775_800.jpg" width="100%" /><figurecaption>Automated fulfillment resources help to hasten delivery while lowering costs. </figurecaption></figure></div><p>Speaking during a December earnings conference with investors, Chewy CEO Sumit Singh said the technology has proven particularly effective from a cost standpoint, noting outlay has diminished rather appreciably. In addition to its Archibald, Pennsylvania facility helping to reduce its expenses, Singh noted costs are also lower at Chewy's Reno, Nevada facility, which <a href="https://www.supplychaindive.com/news/chewy-launches-third-automated-fulfillment-center/631012/" target="_blank">opened earlier this year</a>. Filled volumes from there were roughly 20% cheaper relative to the company's non-automated network, Singh further explained.</p><p>"We're still ramping volume into the third fulfillment center, so there is incremental volume leverage that we expect to gain, and we're still continuing to scale our costs," Singh said.</p><p>As to the more recent expansion, Singh noted plans are underway to build two more automated fulfillment centers, with the first one scheduled to open as early as next year.</p><p>Here a few additional advantages of using automated order fulfillment as a product-based business owner:</p><p><strong>Improve customer satisfaction</strong><br />Businesses are constantly trying to up the ante when it comes to getting goods to customers faster, as much of their satisfaction hinges on speed of delivery. Automated fulfillment helps to get items out the door more quickly by doing in seconds what manual processes take minutes to perform.</p><p><strong>Seamlessly respond to market shifts in customer demand</strong><br />Underestimating demand proved to be a major supply chain dilemma for businesses during the pandemic. But through demand forecasting, a complimentary tool of automated fulfillment systems, your business can get a better sense of what demand will be like at any given time, allowing you to diminish, increase or maintain your inventory needs accordingly.</p><p>These are just a few of the reasons why investing in automated fulfillment can be a wise supply chain management decision. </p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-63704591816057165182022-12-16T23:10:00.002-05:002022-12-19T09:21:45.752-05:00Home construction costs to keep rising, report warns<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiUcCyJmH13L96XkyKBlF33SvKm_czLCv45CzeXgVXbl9VIryhI3AB2b4wiz6mOLUT0TsShRxclrZiLvi7BiYRoCZ93Oz__5cCkownbqb_A_a8N1LdsG7wSg96d1jihK5LPC0tFC2Iq_c9QK30DzJzqsAKH3-e2whLI8YIE7q1JqHwthyOhZfXIQ_tw/s500/Home-construction-costs-soared-in-2022-a-report-suggests-theyll-continue-to-climb-next-year-_834_40195963_0_14106940_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="332" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiUcCyJmH13L96XkyKBlF33SvKm_czLCv45CzeXgVXbl9VIryhI3AB2b4wiz6mOLUT0TsShRxclrZiLvi7BiYRoCZ93Oz__5cCkownbqb_A_a8N1LdsG7wSg96d1jihK5LPC0tFC2Iq_c9QK30DzJzqsAKH3-e2whLI8YIE7q1JqHwthyOhZfXIQ_tw/s16000/Home-construction-costs-soared-in-2022-a-report-suggests-theyll-continue-to-climb-next-year-_834_40195963_0_14106940_500.jpg" /></a></div>Amid rising mortgage rates triggered by the Federal Reserve's attempts to cool white-hot inflation, both home sales and housing starts have dwindled across the country. Indeed, existing-home sales in the U.S. have slipped for <a href="https://www.nar.realtor/newsroom/existing-home-sales-slumped-5-9-in-october" target="_blank">nine consecutive months now</a>, according to the National Association of Realtors, and single-family home construction <a href="https://www.nahb.org/news-and-economics/press-releases/2022/11/single-family-housing-contraction-continues-in-october" target="_blank">dipped by more than 6%</a> in October, the National Association of Home Builders reported. That puts single-family home project activity 7% behind last year's pace through 10 months.<p></p><p>While the higher price of borrowing money is largely to blame for the sales decline, the drop in starts has also been influenced by how much more it's costing contractors to build. And it appears high prices for materials like concrete, drywall and cement will continue for the foreseeable future. </p><p>According to the analysis of Turner & Townsend, a global real estate and infrastructure consultancy, residential building materials as a whole are <a href="https://www.supplychaindive.com/news/supply-chain-construction-building-materials-price-2023/636596/" target="_blank">expected to cost 7% more in 2023</a> than they did this year, Supply Chain Dive reported. They're also poised to climb again in 2024, but to a smaller degree, up 2.7%.</p><p>Michael Hardman, vice president of the United Kingdom-based real estate research firm, said that it's the recurrent nature of escalating prices for construction materials that is a major challenge for the industry's supply chain.</p><p>"[B]y 2024, we will have seen three years of dramatic price escalation," Hardman told Supply Chain Dive. "If projects — and compounding effect — are true, we will see material prices approximately 25% to 28% higher than they would have been by equivalence in 2020."</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="Builders have felt the effects of inflation, which has impeded home construction." class="inlineImage" height="auto" id="14055204" src="https://pictures.brafton.com/x_0_0_0_14055204_800.jpg" width="100%" /><figurecaption>Builders have felt the effects of inflation, which has impeded home construction.</figurecaption></figure></div><p><strong>Home affordability at its worst since 2012</strong><br />These market factors have also contributed to ever-escalating home prices, even though demand among buyers has trailed off considerably. In October, for example, the median price among existing homes was $379,100, according to the National Association of Realtors, despite sales falling 5.9% that month. The year-over-year increase marked the 128th consecutive month in which selling prices rose among all housing types, single-family, condo and otherwise. It comes as no surprise that housing affordability has <a href="https://www.nahb.org/news-and-economics/press-releases/2022/11/housing-affordability-falls-to-more-than-10-year-low-as-rising-interest-rates-take-a-toll" target="_blank">reached a decade-long low point</a>, based on analysis done by the National Association of Home Builders.</p><p>For the past several years, lumber has been the primary building material experiencing price growth, influenced largely by shortages as well as tariffs. But now that the cost of lumber has come down, prices for other key materials are on the rise. These include substances that are vital for foundations, like cement and concrete. According to Linesight, prices for these materials <a href="https://assets.ctfassets.net/1lsus2dflm8x/6d9kXRciWpl6ytIDbRkSsg/107e7729fced5b2b632a8432758ae894/Linesight_US_Commodities_and_Insights_Report_Q3_2022.pdf" target="_blank">were up a combined 14%</a> during the third quarter.</p><p>Robert Dietz, chief economist at NAHB, said that as a result 2022 is on track to be one of the quietest times in recent memory for homebuilding activity.</p><p>This will be the first year since 2011 to post a calendar-year decline for single-family starts, Dietz warned. "We are forecasting additional declines for single-family construction in 2023, which means economic slowing will expand from the residential construction market into the rest of the economy."</p><p>Limited inventory, fueled by the steep cost of building, is keeping home prices in elevated territory and budget-minded buyers on the sidelines.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-86643266416782152282022-12-14T23:10:00.002-05:002022-12-15T10:15:14.055-05:00Weak harvest leaves restaurants short on lettuce<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjDL605CqWeiqi9gxi3YG_h2MG-40LaZnOznu05FNX71Ki_kr2WrQ3VtqXz4eNdAL2Ws0OMTv65r30TdxGDn-eytBFQzck2sGHuwJ3DsUMgZ9Twu-K8ndAIReA28me0-Zp0jBOOnd9ejeBZggVIqfCDg9niaNGfh9OHjKjIc0IoDdpYvFZ9cKpT9Kwn/s500/Prices-on-lettuce-have-skyrocketed-due-to-poor-crop-production-in-2022-_834_40195960_0_14114351_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="334" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjDL605CqWeiqi9gxi3YG_h2MG-40LaZnOznu05FNX71Ki_kr2WrQ3VtqXz4eNdAL2Ws0OMTv65r30TdxGDn-eytBFQzck2sGHuwJ3DsUMgZ9Twu-K8ndAIReA28me0-Zp0jBOOnd9ejeBZggVIqfCDg9niaNGfh9OHjKjIc0IoDdpYvFZ9cKpT9Kwn/s16000/Prices-on-lettuce-have-skyrocketed-due-to-poor-crop-production-in-2022-_834_40195960_0_14114351_500.jpg" /></a></div>The vegetable responsible for giving salads, sandwiches and other common dishes their signature crunch is experiencing a supply chain crunch — and restaurateurs are warning customers it could crimp some of their menu offerings.<p></p><p>Due to a variety of environmental factors — such as drought, stifling temperatures and crop disease — lettuce availability has slipped, as growers have been hammered by uncooperative weather for the past couple of years. Indeed, in 2021 lettuce production <a href="https://www.ers.usda.gov/webdocs/outlooks/103821/vgs-368.pdf?v=9338.6" target="_blank">fell 11% compared to the previous year</a>, according to the United States Department of Agriculture. It isn't just one kind of lettuce, either — from romaine to bib to iceberg and more, the leafy green shortage is widespread. As a result, it's pushed prices northward, <a href="https://data.ers.usda.gov/reports.aspx?domain=Veg&summary=False&groupName=Fresh%20veg&ID=17855#Pdfd712a98c214f848e26bfee7c37d5e8_2_63iT0R0R0x1" target="_blank">up almost 18% in October</a> compared to 12 months earlier, USDA reported separately. This compares to a dip of 8% over the same period for fresh vegetables as a whole.</p><p>Since lettuce is a staple ingredient in a host of restaurant offerings, quick-serve entities have warned some of their customers about the lack of lettuce. Some of the fast-food chain franchises that have issued statements about the shortage include Taco Bell, Subway and Chick-fil-A. On its website, the eatery famous for its chicken sandwiches informs visitors that their menu selections "may be unavailable or prepared differently" for the foreseeable future, Parade <a href="https://parade.com/news/fast-food-chains-facing-lettuce-shortage" target="_blank">noted</a>.</p><p>Restaurants that specialize in lettuce, or for whom changing the vegetable would compromise quality or customer satisfaction, are <a href="https://www.restaurantbusinessonline.com/amp/food/lettuce-shortage-adds-side-order-purchasing-pain-inflation" target="_blank">issuing surcharges on lettuce</a>, but informing buyers of their temporary policy through signage, Restaurant Business Online reported.</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="Iceberg and romaine lettuce growers were ravaged by inhospitable conditions in 2022." class="inlineImage" height="auto" id="14043154" src="https://pictures.brafton.com/x_0_0_0_14043154_800.jpg" width="100%" /><figurecaption>Iceberg and romaine lettuce growers were ravaged by inhospitable conditions in 2022. </figurecaption></figure></div><p><strong>Shortage blamed on extreme heat and blight</strong><br />Major lettuce suppliers, meanwhile, are well aware of the lettuce crisis. Speaking to the issue during a quarterly earnings conference, Dole Chief Operating Officer Johan Linden attributed the problem to an unusually bad stretch for harvesting. For example, <a href="https://www.supplychaindive.com/news/restaurants-produce-suppliers-warn-national-lettuce-shortage/637685/" target="_blank">iceberg lettuce production is down 40%</a>, which Linden said has been mainly due to extreme heat in states like California and Arizona, Supply Chain Dive reported.</p><p>Another contributor to the shortage is disease. As noted in Salinas Valley Agriculture, a publication produced by the Grower-Shipper Association of Central California, a virus called Pythium wilt <a href="https://ucanr.edu/blogs/blogcore/postdetail.cfm?postnum=43736" target="_blank">has plagued growers' fields since 2015</a>, becoming particularly pervasive in 2020 and persisting since. The disease, which causes lettuce to wilt and rot prematurely and is caused by water mold, primarily affects green leaf lettuces, as opposed to red leaf.</p><p>Impatiens Necrotic Orthotospovirus, otherwise known as INSV, has also ravaged growers and cut into their profits.</p><p>While food prices in general have experienced some of the biggest increases in prices fueled by inflation, the cost of lettuce has grown exponentially over the past several years. A box of iceberg lettuce on the open market cost $14 in 2019, according to Restaurant Business Online. Today, it's $63 per box, a near 400% increase. </p><p>Suppliers remain confident that the lettuce deficit shouldn't last much longer, with Dole anticipating improvement within the first month of the new year. Prices may come down by then as well, depending on the degree to which supply normalizes and demand softens.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-9411412563782218392022-12-07T23:10:00.002-05:002022-12-08T07:14:40.717-05:00Inflation doesn't cause holiday shoppers to shy away from spending<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjXUD4d7X6iy533OAE1BxzEsFAWs-x3bqOwzExVA8H4pUmynMCW0RIAX9nvjYM1uJeWUQxYE4FCqYzdpPRaZ9D1_LAZ1ePCB7YkDgnhPIXM2aUSonFwyoH4QKuvcRdlDWLcSZogu9CbEBmcSQsTY_rOEbTA3QHupOgeCoHgNS_JJwXl016gadz78c3O/s500/Inflation-wasnt-enough-to-diminish-holiday-shopping-activity-in-the-kickoff-to-the-season-_834_40195956_0_14143732_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="333" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjXUD4d7X6iy533OAE1BxzEsFAWs-x3bqOwzExVA8H4pUmynMCW0RIAX9nvjYM1uJeWUQxYE4FCqYzdpPRaZ9D1_LAZ1ePCB7YkDgnhPIXM2aUSonFwyoH4QKuvcRdlDWLcSZogu9CbEBmcSQsTY_rOEbTA3QHupOgeCoHgNS_JJwXl016gadz78c3O/s16000/Inflation-wasnt-enough-to-diminish-holiday-shopping-activity-in-the-kickoff-to-the-season-_834_40195956_0_14143732_500.jpg" /></a></div>With crippling inflation taking its toll on Americans' budgets, consumers have been tightening their belts to save where they can. But they haven't let that belt tightening sap their holiday shopping appetite — and on Thanksgiving weekend, no less.<p></p><p>Over the five-day Thanksgiving holiday — running Thanksgiving Day to the following Monday — <a href="https://nrf.com/media-center/press-releases/record-1967-million-consumers-shop-over-thanksgiving-holiday-weekend" target="_blank">nearly 197 million U.S. consumers spent</a> at least a portion of it shopping, according to newly released statistics from the National Retail Federation. Not only was that figure higher than last year — when inflation wasn't as pronounced — it was an all-time record, amounting to an estimated 76% of consumers. That's up from 70% in 2021.</p><p>Cyber Monday sales were particularly brisk, with an estimated 77 million individuals hitting the e-stores, NRF data showed. Combined with those in brick-and-mortar stores, the shopper total was just shy of 100 million.</p><p>The flurry of shopping activity comes as a surprise to some economic observers, especially given the degree to which inflation has occupied the nation's attention. According to a Gallup poll, approximately <a href="https://news.gallup.com/vault/405026/gallup-vault-americans-reaction-record-inflation.aspx" target="_blank">1 in 5 Americans believe inflation</a> is the biggest problem facing the United States, more than crime, climate change, border security or other common challenges respondents cite as important.</p><p>Matthew Shay, president and CEO of the National Retail Federation, noted that holiday shopping regulars and revelers got more creative with their spending to maximize their dollar's value.</p><p>"As inflationary pressures persist, consumers have responded by stretching their dollars in any way possible," Shay explained. "Retailers have responded accordingly, offering shoppers a season of buying convenience, matching sales and promotions across online and in-store channels to accommodate their customers at each interaction."</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="More Americans shopped for the holiday online, saving themselves on gas." class="inlineImage" height="auto" id="14118353" src="https://pictures.brafton.com/x_0_0_0_14118353_800.jpg" width="100%" /><figurecaption>More Americans shopped for the holiday online, saving on gas.</figurecaption></figure></div><p><strong>Buyers taking advantage of convenience shopping</strong><br />In some respects, the growth in spending and shopping activity makes sense — particularly as it pertains to the uptick in Cyber Monday buying. With gas prices still uncomfortably high across the country — averaging more than $4 in several states — shoppers are turning to their laptops, desktops and mobile devices to shop, avoiding the drive to stores. In terms of actual spending, sales <a href="https://business.adobe.com/resources/holiday-shopping-report" target="_blank">topped $11 billion</a>, based on initial performance results reviewed by Adobe Analytics. That's a near 6% surge from 2021. At one point, online users were spending roughly $13 million per minute, Adobe revealed.</p><p>Additionally, retailers incentivized shoppers to log on by offering doorbusting deals, done in part to dwindle excess inventory.</p><p>Vivek Pandya, lead analyst at Adobe Digital Insights, noted that this strategy paid off — quite literally.</p><p>"With oversupply and a softening consumer spending environment, retailers made the right call this season to drive demand through heavy discounting," Pandya <a href="https://www.retaildive.com/news/cyber-monday-spend-bnpl-electronics-toys-inflation/637462/?utm_source=Sailthru&utm_medium=email&utm_campaign=Issue:%202022-12-01%20Retail%20Dive:%20Tech%20%5Bissue:46385%5D&utm_term=Retail%20Dive:%20Tech" target="_blank">told</a> Retail Dive. "It spurred online spending to levels that were higher than expected, and reinforced e-commerce as a major channel to drive volume and capture consumer interest."</p><p>Black Friday was also a strong day for retailers, surpassing Cyber Monday in consumer traffic. Over 87 million took to the stores on the day after Thanksgiving, according to the NRF's data. Almost 73 million leveraged Black Friday deals via online means.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0tag:blogger.com,1999:blog-7018230518319999846.post-27451367712809036672022-12-05T23:10:00.002-05:002022-12-06T07:50:14.320-05:004 reasons to adopt a just-in-case inventory management strategy<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEic6b8LkFi1mjn9JWME-JciEBvAjIUbHIB3oSIc_lP3c3tPbVwWy_0Y3fPoCFZ9UhUb1UxzO-X6lYSbhiehtKQ7XVPCX6lU-vOLrc8Eir-y7ugEEddhUu9LHAFl8RInbew8GVMe0XqyP9c_SyyCSe6LMqB1xy7uOyCXGHoDcfvyf_t6yL9ZCYxrNA_N/s500/Justincase-inventory-management-may-be-new-normal-for-productbased-businesses-_834_40195953_0_14120491_500.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="334" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEic6b8LkFi1mjn9JWME-JciEBvAjIUbHIB3oSIc_lP3c3tPbVwWy_0Y3fPoCFZ9UhUb1UxzO-X6lYSbhiehtKQ7XVPCX6lU-vOLrc8Eir-y7ugEEddhUu9LHAFl8RInbew8GVMe0XqyP9c_SyyCSe6LMqB1xy7uOyCXGHoDcfvyf_t6yL9ZCYxrNA_N/s16000/Justincase-inventory-management-may-be-new-normal-for-productbased-businesses-_834_40195953_0_14120491_500.jpg" /></a></div>Prior to the pandemic, just-in-time inventory — the supply chain management strategy of keeping "just enough" inventory in stock to satisfy expected demand — was considered conventional wisdom. But in the aftermath of COVID-19 and the product shortages that were omnipresent, organizations are reconsidering that erstwhile best practice. Indeed, according to a recent survey conducted by SAP, close to <a href="https://news.sap.com/2022/10/us-supply-chains-in-2023-new-research-forecast/" target="_blank">66% of organizations are adopting a just-in-case approach</a> to inventory and supply chain management.<p></p><p><strong>What is just-in-case inventory?</strong></p><p>At its essence, just-in-case inventory is the inverse of just-in-time. Instead of maintaining the bare essentials in terms of product offerings to fulfill sales goals or to avoid shelves emptying prematurely, just-in-case prioritizes having a surplus of inventory — "just in case" demand for merchandise exceeds supply. In short, it's an "everything and the kitchen sink" approach to inventory management.</p><p><strong>What are the business benefits of just-in-case inventory strategies?</strong></p><p><strong>1. Increase competitiveness</strong><br />When items are out of stock and customers are unable to purchase what they're looking for, it represents a missed sales opportunity. That's because buyers know that if they can't find a given product, they won't stop searching; they'll try to buy elsewhere — and will likely be successful. That lost sale may not be one-off instance either, if the alternative suppliers' good are of higher quality or sell for a more reasonable price.</p><p>Just-in-case inventory helps to keep loyal customers loyal by ensuring they'll come to you first for items they need to have, and can potentially get buyers to switch if their go-to supplier is experiencing sourcing issues.</p><div class="inlineImageWrapper" style="float: left; height: auto; margin: 10px; padding-right: 3px; width: 100%;"><figure style="font-style: italic; margin: 0px;"><img alt="An excess inventory strategy may be the new best practice for supply chain efficiency." class="inlineImage" height="auto" id="14053521" src="https://pictures.brafton.com/x_0_0_0_14053521_800.jpg" width="100%" /><figurecaption>An excess inventory strategy may be the new best practice for supply chain efficiency. </figurecaption></figure></div><p><strong>2. Add demand forecasting flexibility</strong><br />Just-in-time inventory advocates laud this strategy for its cost savings since it lessens the risk of having to absorb the expense of buying excess product. But this approach can make demand forecasting more challenging since there is so little room for error between what is enough and what is too much for merchandise. Just-in-case leaves more wiggle room for demand forecasting since the strategy presupposes that demand will fall short of supply. Just-in-case inventory also makes planning simpler for other affiliate suppliers who have their own production costs to arrange.</p><p><strong>3. Leverage bulk discount offering </strong><br />There's a reason why "buy one get one" offers are as popular as they are: Bulk buying saves money for consumers — and for businesses. It does so by allowing companies to make more efficient use of their resources, saving time on production processes and cutting costs associated with packaging and receiving.</p><p>Adopting a just-in-time inventory strategy also adds flexibility to how you go about selling your products. If you wind up selling substantially less than what you have in inventory, you can review what it will cost you to reduce the price of certain products while still turning a profit or make a BOGO offer of your own to stimulate buyer interest.</p><p><strong>4. Avoid supply chain snags</strong><br />While supply chains are operating more nimbly, the bottlenecks haven't entirely cleared. Close to 50% of respondents in the SAP survey said they anticipate more raw material shortages in 2023. Continually shoring up inventory can help you avoid production hitches when supply chain snags occur.</p><div class="blogger-post-footer">Brought to you by the <a href="http://www.strategicsourceror.com">StrategicSourceror</a>.
A Blog for Procurement, Supply Chain and Purchasing Professionals, sponsored by <a href="http://www.corcentric.com">Corcentric</a>, a leading Procurement Service Provider, specializing in Strategic Sourcing, Procurement Resources and Procurement Advisory.</div>The Strategic Sourcerorhttp://www.blogger.com/profile/04367380101695641958noreply@blogger.com0