Archive for May, 2008

Where should your RFI data come from?

Friday, May 30th, 2008

A ccording to sources such as Wikipedia and others, a Request for Information (RFI) is a standard business process whose purpose is to collect written information about the capabilities of various suppliers. Normally it follows a format that can be used for comparative purposes.

So a Request for Information (RFI) is primarily used to gather information to help companies make a decision on what steps to take next. RFI’s are therefore most often the first stage in the procurement process particularly with new sources of supply. They are used in combination with: Requests for Quote (RFQ), Requests for Tender (RFT), and Requests for Proposal (RFP). In addition to gathering basic information, an RFI is often used as a solicitation sent to a broad base of potential suppliers for the purpose of preparing a supplier’s thought process in preparing for a Request for Proposal (RFP), Request for Tender (RFT) in the government sector, or a Request for Proposal (RFP).

Much of the data required for an RFI is generally available and can be found on company websites, U.S. Security and Exchange Commission (SEC) filings for publicly traded companies in their Edgar system, industry guides from companies like Trade Dimensions, or from sources like Dun and Bradstreet.

The challenge for most companies is that they do not have the necessary resources to complete this research. Therefore providers of supplier data should be able to make this data available in templates that companies can begin with. Simple data should always be available in any database as to Company Name, Annual Sales, Product category expertise, contact information, e-procurement experience and product specifications. This data should be easily exportable to a variety of formats such as MSFT Excel.

A simple request of your e-procurement supplier should get you well on your way to completed RFI’s that lead to quality RFP’s and RFQ’s without spending a lot of your valuable time on basic research. If they do not, we’d be glad to hear from you.

I look forward to your comments.

Ron

What is A WIKI? Why the SafeSourcing Wiki?

Thursday, May 29th, 2008

According to the king of all wikis, Wikipedia; a wiki is a collection of web pages designed to enable anyone who accesses it to contribute or modify content, using a simplified markup language. Wikis are often used to create collaborative websites and to power community websites. For example, the collaborative encyclopedia Wikipedia is one of the best-known wikis. Wikis are used in businesses to provide affordable and effective intranets and for knowledge management. Ward Cunningham, developer of the first wiki, originally described it as “the simplest online database that could possibly work”.

“Wiki” is a reduplication of “wiki”, a Hawaiian word for “fast”. It has been suggested that “wiki” means “What I Know Is”.

So, what is a SafeSourcing Wiki? Since SafeSourcing is a company dedicated to retail e-procurement that is safety in the supply chain and to environmental consciousness, it makes sense that the SafeSourcing Wiki would be a specialized wiki ( in this case retail e-procurement) that concentrates at a minimum on any or all of the following.

1. Retail procurement terms and links.
2. Safety standards and definitions and links.
3. Environmental certifications and definitions and links.
4. Educational content for procurement and supply chain professionals.
5. Procurement templates for commonly sourced products and services.

The nice thing about wikis is that the definitions are not static. Authorized users can add to definitions or add definitions and terms as well as rate the site. In this way a body of work can grow from the contribution of all users and help to provide a reliable source of data for professionals in a specialized field.

Please feel free to visit the safesourcing wiki regularly and offer your comments, terms, definitions and suggestions. This section of the SafeSourcing website is free tool, and it is for your use as a procurement and supply chain professional, the most difficult job in retail.

I look forward to your comments.

Ron

Calling all Green Retailers. You’ve got to love this!

Wednesday, May 28th, 2008

I love it when I open the paper in the morning and read something like “What’s Big Green and Found All Over” that’s exactly the title of the lead article in the Business Section of The Arizona Republic yesterday Tuesday May 27th 2008 by Cathryn Creno. An accompanying article titled “Chains sold on Green” also written by Cathryn Creno details how retailers embrace energy efficiency. The environment wins twice in one day. We must be making progress. Areas of focus within the article are Leadership in Energy and Environmental Design or LEED, the EPA’s Retail energy Star program, and the EPA’s retail Green Power Partnership list.

A couple of other certifications that retailers may want to pay attention too are Green Seal www.greenseal.org .Green Seal works with manufacturers, industry sectors, purchasing groups, and governments at all levels to “green” the production and purchasing chain. Green Seal utilizes a life-cycle approach, which means they evaluate a product or service beginning with material extraction, continuing with manufacturing and use, and ending with recycling and disposal. EcoLogo www.ecologo.org . is also worthy of consideration and is North America’s most widely recognized and respected certification of environmental leadership. By setting standards and certifying products in more than 120 categories, EcoLogo helps you identify, trust, buy, and sell environmentally preferable (“green”) goods and services. Both of these certifications are included in the SafeSourceIt™ North American supplier database as one of our supplier certification standards

Personally and for Safesourcing I would like to offer congratulations to the following retailers. Wal-Mart Stores Inc., Whole foods Market Inc., J.C. Penney Co. Inc., Kohl’s Corp., and Safeway Inc. You all serve as a wonderful example of leading the charge in what we all can do towards leaving a better world for our children and theirs.

I look forward to your comments.

Ron

How can your company reduce, reuse, recycle?

Tuesday, May 27th, 2008

Most of us have heard these three words many times before, and most of us have the same reaction when we see them in print. “Oh, I’ve heard of that.” The funny thing is once you start to focus on them, the way you do things begin to change. When you leave a room you look to make sure all the lights are off. When you’re shaving in the morning, you fill the sink and don’t just stand there with the water running. You really do start to segment your trash into separate containers. By the way, did you know that in Japan they actually have someone that works daily in their apartment buildings to separate the trash after you do to make sure you go it separated properly? That’s having a commitment. I think more and more each day about my personal carbon footprint and how I can leverage those thoughts in our business with suppliers and retailers.

My granddaughter was in town visiting for the Memorial Day weekend and leaving a better world to live in just seems that much more important every time I see her. So in trying to come up with an idea for today’s blog, I was getting ready to go out for my daily run when I remembered an interesting article called Mr. Greenshoes in my Running Times magazine. It talked about going beyond being passionate about your own personal fitness to being equally passionate about the health of mother earth.

There was some excellent information about what some running shoe companies are doing to reuse old running shoes. There is the Nike “Reuse-A-Shoe” program. They regrind the shoes and use them for sport courts and tracks for the economically disadvantaged. This is a much better story than the subject of my blog on May 14th “How safe are we?” where I discussed the health risks associated with artificial turf. Additionally, Brooks Sports has started to produce their new shoe boxes with 100% post-consumer/production recycled content. The graphics on these boxes are printed with vegetable based ink, as are the labels which are made from recycled paper. These are just examples of how two companies clearly understand the importance of paying it forward for the next generation. We should honor manufacturers and suppliers like this with our business and our recommendation to others.

What can your company do?

I look forward to your comments.

Ron

Retailers are your fuel purchases pennies wise? Some fuel for thought.

Friday, May 23rd, 2008

With gas prices approaching $4.00 per gallon (and that’s economy fuel) it may be time to figure out how to save pennies that you might not have focused on historically in order to continue working with your legacy fuel suppliers. Are you aware of other sources of supply? Is it possible to save a few pennies per gallon by making your suppliers compete for your business?

When the price of oil goes up, and today crude futures retreated slightly after topping 135 U.S. dollars a barrel for the first time; we hear mostly about the price of our gas at the pump. In the U.S. we don’t expect to pay this much for that precious commodity we all need in order to get to work, drive the kids to all of their activities, buy groceries, go to the doctor, and when time permits enjoy our leisure activities. What we don’t hear a lot about is the price of all the related fuel products like diesel, kerosene or jet fuel. The truth is they are all going up.

In our SafeSourceIt™ North American supplier database there are 3,292 U.S. suppliers in the major category fuel. This data can be further filtered into sub categories such as kerosene, diesel etc. Data can then filtered by region, zip code and a variety of other classifications. The same data is available for Canada and Mexico.

With the availability of this type of data, retailers may be able to reduce or hold their fuel prices. In most cases fuel either directly or indirectly represents one of many retailers top spend categories. Watching rack rates daily and having new sources of supply that are also trying to survive compete for your business provides a formula for saving pennies and takes the emotion out of the decision making process. In the food industry where net profit regularly runs at 1% or less pennies add up.

I know I’d go to a pump that was priced at $3.99 per gallon instead of one next to it priced at $4.00.

I look forward to your comments

Ron

How do Retailers and Suppliers go Green?

Thursday, May 22nd, 2008

Today’s retailers have so many initiatives on their plates that trying to focus on what at first does not seem to be their most important initiative (Going Green) can create a type of corporate gridlock that stops the organization from moving forward in a timely manner. The key is to not bite off more than you can chew and to set realistic goals and timeframes. There are so many external organizations trying to share their green initiatives today and set their own company standards so high that they hope to become the standard for everyone. As a result, volumes of data exist that would drive many organization crazy just trying to sort thorough it in order to come up with their own companies guideline.

So, where should a company begin? First of all, companies need to set guidelines for their company. In order to set guidelines, companies need to realize going in that guidelines are intended to be ‘living documents’, and will be updated on a regular basis going forward. In other words, by their nature they are not complete. Since we are talking about the environment, let’s make sure we don’t go down the path of health, safety and other areas even though they are related. Crossover with these areas will occur naturally as you focus on your guidelines for those specific areas later. Today we are here to talk about the environment. So what do we focus on? A starting point for the environment will always include the following. As you try to break this format down further, you will find that almost all areas fit into the following categories. As an example, contaminated land would fall into land management.

Energy Conservation
Water Conservation
Hazardous Materials Handling
Waste Management
Noise Pollution
Land Management
Wastewater Management

An important piecet of any corporate policy once outlined is to make sure that you share your guidelines with your trading partners and hold them accountable to doing the same thing in order to earn their business with you.

Once you begin to focus on tgoing green, it’s amazing how you will transfer it to your personal life. I know it’s personal for me.

I look forward to your comments.

Ron

Suppliers are you Green Enough? Do consumers really care?

Wednesday, May 21st, 2008

Do you ever wonder why the entire hubbub when we talk about the environment or the ecology? What does it really mean when we ask companies are you green enough? Or, are you doing all you can to protect the environment. Do we even really care? What does it really mean?

Well, apparently we do care and companies that want to prosper should pay attention to the groundswell of consumers that are willing to pay more to get more in the way of safer products from companies that go beyond product safety to also manufacture in a way the protects the environment for our children and their children after we are gone.

A Wells Fargo/Gallop phone survey in 2007 of 600 small business owners surveyed on the environment asked the following questions.

  1. Should additional standards on carbon dioxide, greenhouse gases be implemented? Forty three percent of respondents rated that a priority. Thirty seven percent rated it a top priority and nineteen percent said it was not a priority
  2. On the question do you favor or oppose setting higher emissions and pollution standards for business and industry, seventy five percent favored it while twenty five percent opposed it.
  3. When asked if they would be willing to pay more for good, and services if you new they were environmentally friendly, sixty six percent said yes and thirty percent said no.

During this political season any politician that received eighty percent, seventy five percent or sixty six percent of any vote would consider it a landslide and an affirmation of their political agenda.

In a closer vote, an Allianz Global investor survey of over one thousand adults of whom only seventeen percent had invested in a particular mutual fund because it was developing technologies or approaches to address environmental problems. When asked the question would you invest in such companies or mutual funds in the next year, forty nine percent said yes.

So, suppliers’ are you green enough. Your constituents are watching and voting with their dollars. If you’re not you should look for ways to get there quicker and take advantage of tools that can help you do it.

I know I look more closely now at what my personal carbon footprint is and the impact it has on future generations,

I look forward to your comments.

Ron

When Ecology and Safety Collide!

Tuesday, May 20th, 2008
I read two short but interesting articles lately. They indicated how not being ecologically sound in one area can have a potentially long term negative impact on safety in the food chain. One article was titled “Study finds lead in game meat”. The other was titled “Fla. warns of mercury levels in frog legs”. Now I must admit that I do not hunt, nor do I consume venison or frog legs. I have had venison before and I have eaten bison. I just don’t eat them on a regular basis.
So, where is the safety connection? Well, just as we have alternative energy sources, hunters have alternative ammunition choices. As in most green focused issues it does come down to the price. In the case of game meat, hunters have the choice of using non lead bullets or shot. Retailers also have the choice of selling non lead bullets or shot.
A study released last week by the Peregrine Fund and Washington State University shows that people who ingest game animals killed with lead bullets risk ingestion of poisonous metal. Even amounts formerly considered safe have a variety of health related issues associated with them.
Now, what about those frog legs? How did they get such high levels of Mercury?
Mercury gets into the air as a byproduct of industrial activities such as chlorine production, power generation from coal, garbage incineration, and some manufacturing processes. The airborne mercury from these activities is deposited on land and water, where microorganisms convert it into a more biologically active form, methyl mercury.
When humans or other animals consume the fish, we get the mercury that’s now in the fish. Short-term exposure to high concentrations of mercury vapor has harmful effects on the nervous system, digestive system, respiratory system, and kidneys. Long-term exposure to mercury can permanently damage the brain and kidneys at any age.
In the Florida article, health officials suggested that people eating a particular type of frog legs (pig frogs) should limit their consumption to one eight ounce serving per month.
What can retailers do? For one thing we can insure that our sources of supply for wild game and fish if we carry them certify that they are free of lead and mercury. We can ask our suppliers to insure that the processing plants they use are doing what is necessary to help in the reduction of mercury by supporting programs such as the Clear Skies Initiative.
I’ll probably eat game animals again at some point, but I’ll think more about it when I do.
I look forward to your comments.

Twenty steps to running high quality e-procurement events.

Monday, May 19th, 2008
Regardless of the naming convention used there are certain rules which if followed will create higher quality events for both the retailer and the supplier? This will result in creating better savings opportunities or cost avoidance in  tough markets. The importance of focusing on a clear process will increase event participation. This focus on quality will be recognized by your existing trading partners and potential new sources of supply, and will keep them coming back in the future to compete fairly for your business.
Below are twenty steps that are mandatory if you wish to have success with e-notitation events and specifically  reverse auctions.  
  1. Executive sponsorship is mandatory.This is required at the CEO, CFO, CPO, CLO or head of the supply chain.
  2. Get the entire buying organization together for a kickoff session.
  3. Provide an over view of what you are going to do and the impact it can have on the company. Use company financial models.
  4. Discuss and agree on success criteria.
  5. Every event is not a homerun. Singles and doubles score runs.
  6. Create a fun environment.
  7. Consider prizes for the most creative use of an auction.
  8. Use scorecards by department with percent of savings.
  9. Discuss the meaning and importance of corporate aggregation.
  10. Hand out event templates to gather existing product specifications.
  11. Put a time requirement on data collection.
  12. Gather an accurate list of your present suppliers.
  13. Work with your sourcing company to identify a top 100 list of events.
  14. Calendar the events.
  15. Prioritize by dollar value, date and strategic value.
  16. Conduct department level discovery meetings of 30 minutes to an hour.
  17. Investigate existing contract language.
  18. Look for auto renewal (evergreen) language roadblocks.
  19. Determine alternate sources of supply with your sourcing company.
  20. Develop an event rules and instruction template and post with each event.
Although these steps are not all encompassing, they provide a format for getting started that offers the best opportunity for reduction in cost of goods, expenses and improvement in corporate earnings. Be sure to combine this with a business partner that knows your business.
We  look forward to and appreciate your comments.

Let’s support our Retail Partners

Friday, May 16th, 2008
In the ARIZONA REPUBLIC today in a small corner of the business section there was a blurb in the Nation & World section titled Product Safety. The sub title of the four paragraph article was Toy sellers say suppliers will meet U.S. standards.
The good news is that retail leaders such as Wal-Mart, Target and Toys “R” Us are behind actions taken by the House and Senate to overhaul the Consumer Product Safety Commission. These actions will require suppliers to meet new standards that limit the amount of lead and other metals in toys and children’s products. I’m not sure if I like the term limit, but any step forward is better than continuing to do the same old thing.
Companies that provide software and applications that are part of automating the procurement process, also need to step up and make sure that their tools support these changes to the greatest extent possible and provide knowledge ware that interacts with both regulatory agencies and suppliers to insure product safety as more new sources of supply and new products enter the supply chain on a daily basis.
Action that software suppliers can take may include but are not limited to:
  1. Providing alert data on a daily basis as to product recalls and safety warnings.
  2. Trace warnings back to the original source of supply automatically.
  3. Require that suppliers meet required safety certifications to participate in their database.
  4. Provide a regular purge of suppliers that do not comply.
  5. Adhere to a strict RFI process for new suppliers being added to databases.
  6. Rate suppliers that are offered to retailers as new sources of supply.
  7. Monitor regulatory agencies for new standards and include them in the database.
This is only a start, but in order to insure the safety of our families it is our social responsibility as business partners to support our retailers efforts.
I’m sure glad we don’t have to worry about lead in pencils any more.
Ron