Archive for November, 2017

The Price of Dye in China

Tuesday, November 28th, 2017

 

Todays’s Post is by Eli Razov, SafeSourcing  Account Manager.

What are Leuco Dyes and how are the affecting millions across the globe? Right now the world is seeing huge increases in the thermal paper market. Leuco  dyes are made of many different chemicals which can combine  to achieve the desired color. These dyes have a colorless leuco form when crystalline or when in a pH neutral environment, but become colored when dissolved in a melt and exposed to an acidic environment. Lueco dyes provide little color when melted unless they are melted with one or more organic acids. These are called developers. One example of organic acid is Bisphenol A (BPA). These developers and Leuco dyes often mix poorly upon melting. A third chemical called a sensitizer is often added to the imaging layer to increase the effect. So what does this mean?

These are the components used to make thermal paper. The same paper you see daily from receipts at the local grocery store to fast food chains. The world thermal paper market is about one million tons annually, with about 2/3 of that tonnage for receipt paper. But right now, there is a major shortage in Lueco Dyes. This shortage is due to a company in China named Connect Chemicals which is responsible for 35% – 40% of global dye demand for thermal coaters. In September of 2017 the Connect Chemicals was shut down due to environmental reasons and China’s new anti-pollution laws. This spells disaster for retailers especially Going into the holiday season, which is the busiest time of year. Thermal paper pricing has seen an increase of over 20%-45%. This is making the demand outgrow the supply in many cases. Many major distributors have been unable to supply their entire current customer base and are preventing them from acquiring new clients.

There is hope because this shortage is estimated to be only roughly 3 months while Connect Chemicals closes to conform to China’s new environmental laws. This will take months to recover losses and hopefully set the market normal again.

For more information on how SafeSourcing can assist you or on our “Risk Free” trial program, please contact a SafeSourcing Representative we have an entire team waiting to assist you today.

We look forward to and appreciate your comments.

References —————————————————-

https://en.wikipedia.org/wiki/Thermal_paper

https://cohally.com/2017/10/05/largest-supplier-of-leuco-dye-shut-down-in-china-for-a-minimum-of-three-months/

 

Choosing the Best Forklift for Your Needs

Monday, November 20th, 2017

 

Today’s post is written by Ivy Ray, Account Manager at SafeSourcing Inc.

Finding the right forklift for your operation can be a challenge. You may have a good idea of what your capacity needs are, but there are many options from which to choose. How do you select the best piece of equipment that fits your needs and your budget?

  • Electric forklifts are clean, quiet, compact and nimble with charging constraints.
  • Gas forklifts are best performers and have indoor/ outdoor flexibility.
  • Diesel forklifts are best outdoors and cheap to run.

Electric

Battery electric forklifts are the most environmentally friendly, and quiet. They are fume free in operation, giving off no harmful emissions. Powered by large, heavy lead-acid batteries, electric lifts typically provide enough power for one standard eight-hour shift or about 5 to 6 hours of continuous use. One of the main disadvantages is that electric fork lifts are not really suitable for prolonged use outside in wet weather, because the damp atmosphere cause problems with wiring circuitry and electrical components. The two biggest advantages to this system are that it produces zero emissions, a necessity if the lift is operated indoors, and is highly economical in terms of fuel.

Internal combustion

Internal combustion (IC) engines run on a variety of fuels including gasoline, diesel fuel, liquid propane gas (LPG), or compressed natural gas (CNG). The main benefits of an IC forklift are the ability to operate them in any environment, a far greater capacity for weight (120,000 lbs. for diesel vs. 12,000 lbs. for an electric), and the ability to be refueled on the fly. They also have a slightly higher reach, usually capping out around 36 feet in comparison to electric lifts that typically don’t go higher than 30 feet.

Their upfront price is the inverse of electric, making them initially cheaper than electric models, but they cost more per hour to run. In fact, you can plan on paying about $30 to fill a 7-gallon diesel tank and $25 to $35 to fill a 33-lb propane tank. If you refuel the tanks twice a day, this equates to a yearly fuel cost of $1,500 for electric, $15,000 for diesel, and about $12,500 for propane.

Dual fuel – a happy median

With the cost of diesel rising, dual fuel engines are becoming the preferred engine type for forklifts and similar industrial equipment in the United States. Comparable in terms of output to single-power options, they provide the cost-saving ability to combine gas and liquid propane or diesel and electric operation, switching between the two modes when power needs change.

In addition to the cost-saving benefits achieved through fuel conservation, dual fuel systems do not require spark plugs or an ignition system, eliminating a good chunk of the maintenance associated with traditional IC engines and boosting overall ROI.

For more information on how SafeSourcing can assist you in exploring your procurement solutions for your business or on our “Risk Free” trial program, please contact a SafeSourcing Customer Service Representative.  We have an entire customer services team waiting to assist you today.

We look forward to your comments.

Resources—————————————————

http://www.bendigomitchell.com/kb/forklift-power

 

How do you choose a new supplier?

Friday, November 17th, 2017

 

Today’s blog is by Margaret Stewart, Manager of HR and Administration at SafeSourcing Inc.

After several devastating hurricanes, the United States is in the cleanup, recovery, and rebuilding process for those areas hit worst. One notable area was the island of Puerto Rico, which was hit by multiple hurricanes, damaging a multitude of structures throughout and leaving the majority of the island without utilities. Because of this devastation, companies were sought to organize and begin the rebuilding of some of the necessities, like water and power.

One particular company, Whitefish, was contracted to begin the power grid restoration for the island, a contract worth hundreds of millions of dollars. However, whether through oversight or intentional, this company, based in rural Montana, had no experience with projects of this size and, in fact, only had two employees. After that information was made public, the contract was ultimately cancelled and eventually awarded to another, larger company. The aftermath of this award of business, however, was a lengthy delay in the rebuilding process at a time when fast response could literally save lives.

While choosing a new supplier of your own may not have such an impact on millions of people as the situation in Puerto Rico, choosing the wrong one can still have a large and negative impact on your organization as a whole. This could mean additional time spent processing orders, paying a higher price until agreements are made or reviewed, or even legal fees involved if a contractual dispute occurs.

This is why it is highly important to not only research any potential suppliers ahead of time, but also to vet those suppliers. At SafeSourcing, we go to great lengths to ensure all the right suppliers are included for projects that you may consider running, and exclude those that do not meet the high standard we expect.

For more information on how SafeSourcing can help with your sourcing needs, or on our Risk Free trial program, please contact a SafeSourcing Customer Service representative. We have an entire team ready to assist you today.

We look forward to and appreciate your comments.

Increase Sales

Thursday, November 16th, 2017

 

Today’s post is by Robert Rice, Account Manager at SafeSourcing.

The sales profession moves faster than ever today. In the blink of an eye, new contenders emerge, products similar to yours are released, and before you know it, it’s dog eat dog. No matter what business you’re in, what worked well a few years ago isn’t good enough today. This is no time for trial and error or order taking; this is a time to sell. Here are some basic steps you can take to improve your sales performance, reduce your cost of selling, and ensure your survival.

1. Explain your task.  Start by understanding your business niche. What categories do we do best? Who needs what we do? How do we best approach these prospects? How much are they willing to pay? If these questions are not answered easily, campaign at the top for clarity and vision.

2. Break the task into specific goals.  Write down the action goals (calls per day, events per month, referrals per call, etc.) that you can control. Set results goals (events per month, amount per event, profit per event, etc.) to measure your progress, and track them closely. Increase your activity and measure the results. Goals focus your attention and boost your action.

3. Sell to customer needs.  Always assume your clients will buy only what they need. How can you persuade them what they need? Highlight the features of your product and service that reduce costs and solve problems for the client. Sometimes you can shift your wares. For example, we ran successful clamshell events how are they on office supplies?

4. Create and maintain favorable attention.  Effective marketing, referrals, strong sales skills, and strategic questions are the keys to creating favorable attention. Diligent follow-through and above-and-beyond customer service are the keys to maintaining it. Think TQM (Total Quality Management)!

5. Sell on purpose. Know both what to do and why you’re doing it every step along the way. Who are you targeting and why? What are you going to tell them and why? What are you going to ask them and why? What is your proposal going to look like and why? When are you going to ask for the event? If you don’t feel sure of yourself at every step of the selling process, get some training or guidance.

6. Ask, listen, and act. Better than any others, these three words summarize success in sales. Your questions must be creative, planned, relevant, and direct. Your listening skills must be highly developed. You must respond and take action that prove that you listened to the client and want the event.

7. Take the responsibility but not the credit. Understand that you are the team leader. The company looks to you for direction and supports your effort. To build a strong support team willing to go the extra mile when you need it, give your team the credit for everything that goes right, and take the blame when it goes wrong.

8. Work on the basics.  Even the best of the best have room for improvement. Make a decision to improve your weaknesses, and set goals to force yourself to do the things you don’t like to do. Be more creative in your prospecting, fact finding, and presentation skills. Visualize the perfect salesperson and compare yourself to the ideal.

9. Develop your attitude.  Your attitude is controllable. No one likes a negative manager. Change the views that limit your success. Your thought behaviors control your obligation, interest, persistence, happiness, and confidence. Be aware of them, decide which ones are unproductive, and then make a commitment to change. With time and effort, you can become the manager they need, especially when profits are down.

10. Maximize your time.  Focus on your goals. Test every action for its rank and urgency. Create an ideal schedule, and test your actual time use against it daily. Remember, just one hour a day used more productively adds up to more than six extra weeks of productive time a year. Someone told me many years ago, but it’s true!

Robert Rice is an Account Manager at SafeSourcing. Robert or any member of the experienced team at SafeSourcing would be happy to discuss how SafeSourcing can help you with your eProcurement planning. For more information, please contact SafeSourcing.

We look forward to your comments.

Resources—————————————

http://asq.org/learn-about-quality/total-quality.

 

Reduce Capital Expenditures

Wednesday, November 15th, 2017

 

Today’s post is by Dave Wenig, Vice President of Sales and Services at SafeSourcing.

Many of our clients find great success in significantly reducing their indirect spend. The typical expense categories that are sourced are always winners and are often the first categories that come to mind when selecting which categories will be sourced using eProcurement tools. As nearly all of our clients know from first-hand experience, these categories have earned this reputation for good reason. The average savings for Supply categories, for example is in excess of 21%. This is relatively well known and is only the start of what is truly possible with eProcurement.

What is less known, and too often overlooked, is that this same eProcurement methodology can very easily be applied to your capital expenditures. At a time when many of our clients are preparing for the coming year, I wanted to point out that you should not forget to leverage eProcurement for your capital expenditures.

At this point, you may well have a very clearly defined sourcing plan in the form of next year’s budget. My suggestion is simple – remember to review that identified spend with your eProcurement provider. You’ll be glad you did.

I would encourage you to also keep an open mind as you decide which of these capital expenses you would identify for eProcurement. You might be surprised to know that our clients have had success in areas where most clients don’t even consider. In one example, we were able to successfully take just one panel van out to market as an RFQ. Inside of days, the client saved many times more than could ever be saved negotiating with dealers using traditional methods. In another example, we achieved 30% savings on two towable generators.

Many of our clients, whether retailers or otherwise, will be working on construction such as opening new stores and remodeling old stores in the coming year. I propose all of that related spend should be sourced using eProcurement. If it is not competitively sourced, you will overpay. Before you build that new carwash, you should know that we do that too. Recently, we achieved over 10% savings on the building and over 34% savings on the installation portions alone for a client.

In this short post, I’ve listed only a few examples out of many, many more and I have not even mentioned your cost of goods or cost of sales. I hope, however, that my main premise was clear. If you have budgeted for capital expenses, you should consider eProcurement to reduce the cost of those expenses. You’ll likely find that you’re able to accomplish much more in the next year based on the savings generated by eProcurement.

For more information, please contact SafeSourcing.  

Advantages of e-Procurement.

Tuesday, November 14th, 2017

 

Today’s post is from our SafeSourcing Archives

e-Procurement comes with distinct benefits over manual purchasing, ranging from increased cost efficiency to greater access to suppliers. Let’s delve deeper into some of these noticeable advantages.

Increased cost efficiency is considered the primary benefit of utilizing an e-procurement purchasing platform. E-procurement puts a single buyer online with many suppliers, thus lessening the leg work traditionally associated with the buyer narrowing his or her field of suppliers.

Using the e-procurement platform, buyers have access to essentially an unlimited list of suppliers, which equates into a wider selection of goods and services. These suppliers have normally undertaken rigorous vetting procedures to ensure that they are the correct supplier for the specific job or work the client is requesting.

e-Procurement applications can be tailored to fulfill the distinct needs of buyers and sellers and be scaled to grow as the organizations expand. For example, suppliers from new territories can be added to supplier databases as the organization grows into new market segments.

e-Procurement processes can greatly increase productivity. Customers can acquire the items they want to procure from a catalog of approved items through an on-line requisition and ordering system. Purchasing staff can be relieved from processing orders, filing paperwork and handling lower priority tasks to focus on strategic sourcing and improving supplier relationships.

In some organizations, purchasing duties are dispersed over several different departments within the company. E-procurement platforms will enable a company to merge orders for similar items with one supplier, resulting in greater volume discounts and cost savings. Additionally, e-procurement may allow a company to simplify purchasing by reducing the number of products involved. Instead of having to sort through large volumes of paper or electronic catalogs, buyers are able to build custom catalogs that include only the items the company is interested in. Additionally, this method increases volumes of smaller numbers of items, which is another process used to generate volume discounts.

For more information on how SafeSourcing can assist you in exploring your procurement solutions for your business, please contact a SafeSourcing Customer Service Representative.  We have an entire customer services team waiting to assist you today.

We look forward to your comments.

 

What is a stock out and what are some of its effects?

Monday, November 13th, 2017

 

Today’s post is from our  SafeSourcing Archives.

A stock out, or out-of-stock (OOS) is defined as a term used in product manufacturing or distribution to describe an inventory shortfall arising from unexpected demand, ineffective inventory management, production delays or replenishment disruptions.” This leaves obvious undesired effects for both the business and the customer.

If merchandise is not available for a customer there may be many possibilities. Your customer may decide to wait to purchase the product. If the product is essential to the customer, then they may be prepared to wait. Even with the willingness to wait, there might be a considerable downturn to the customer’s satisfaction level.

The customer decides to purchase from another vendor or retailer. If the customer is able to obtain the product elsewhere or does not need the item immediately, this is the normal outcome. It is still possible that the customer will do business with you in the future, but this may be detrimental to their customer satisfaction level.

The customer is no longer a customer. This is the potential worst case scenario of a stock out. If a customer is unhappy being unable to immediately purchase the desired product then they may also be willing to permanently purchase or procure this product from another vendor or retailer.

We enjoy bringing this blog to you every week and hope you find value in it. We want to help keep your shelves stocked, with the products your customers need. For more information on how we can help you with your procurement needs or on our “Risk Free” trial program, please contact a SafeSourcing Customer Service Representative.  We have an entire customer services team waiting to assist you today.

 

We look forward to your comments.

 

 

 

Veterans Day; Never Forget!

Saturday, November 11th, 2017

 

Today’s post is by Ron Southard, CEO of SafeSourcing and a US Air Force Vietnam Era Veteran.

What an appropriate sentiment for today November 11, 2019 Veterans Day. That quote which has been paraphrased a lot is actually “Blessed are those that can give without remembering and receive without forgetting”. This author believes it may be attributed to William Buckley. At least the first time I heard it.

Today is a day that we don’t expect those that have given so much to have to remember. It is up to those of us that have received their gifts to remember them and pay those gifts forward. Our veterans have provided a gift of service in order to defend the principles that guided our founding fathers almost 250 years ago. Many gave their lives. We will remember them and their families on this day and it is appropriate that we should.

Let the mottos of our branches of the US Military help you remember what guided all of those that gave in the name of Freedom.

1.  US Air ForceIntegrity First,, Service Before Self, Excellence in All We Do
2.  US Coast Guard “Semper Paratus” (Always Ready)”
3.  US Marines“Semper Fidelis” (Always Faithful)”
4.  US Navy“Honor, Courage, Commitment”
5.  US Army“This We’ll Defend”

SafeSourcing looks forward to and appreciates your comments

 

No Empty Chairs at the Table?

Thursday, November 9th, 2017

 

Today’s post is from our SafeSourcing Archives!

Many procurement professionals state they do not have a strategic role in board meetings or with major organization decisions. Why should a procurement professional participate in board meetings?

Companies that do not engage their procurement department early in the process are failing to make effective purchasing decisions, not fully leveraging their spend and economics of scale, and opening themselves to commercial risk. Procurement is usually brought into the process to either close a deal or execute the contract; at this point it is too late to add significant value.

Common issues corporations face when procurement has little engagement within the department:

• Spend is spread thin throughout multiple categories and suppliers.
• Process improvements (make vs. buy) are not always the ideal cost-savings decision
• Procurement policies are lacking – leading to no contracts, multiple price points, etc.

Handling these internal issues is not a day’s job. Procurement will need to monitor and track compliance with policies within departments. Departments that do not comply will be held accountable. Many times the CPO will need to become involved in this initiative to place more focus on the value of procurement.

In turn, this will also require procurement to refocus their efforts to include other value-added services to the departments besides simply reducing costs. However, this usually requires a change in culture, taking procurement away from the tactical, category-focused culture that dominates most functions, to one that is fully aligned with the company’s goals.

At SafeSourcing, we are an extension to your procurement department. We will work with procurement and other departments to help avoid the common issues when procurement does not have a chair at the table.  Please contact us in order to find out more.

We look forward to and appreciate your comments

So, you’re not using e-Procurement tools because of your team’s objections

Wednesday, November 8th, 2017

 

The following are the objections we hear all of the time after we have presented to a prospect that has not been exposed to e-procurement tools in the past.

1. I already get the best cost.
2. We’ve done business with this supplier for years.
3. I don’t have product specifications.
4. I don’t have time for this.
5. Switching costs will be too high.
6. I can’t insure the same quality.
7. We need to adhere to certain standards.

Now please review the dozen benefits below and realize that while you are trying to answer these objections that your competition is reducing their cost by as much as 20% across the board.

1. They would continue to source high quality products.
2. They would continue to have great supplier relationships.
3. They would free up time to do other tasks.
4. They would improve their company’s net earnings by up to 100%.
5. They would support our fragile environment.
6. They would support global food and product safety initiatives.
7. They would have a larger audience of piers to converse with daily.
8. They would have a single source of information about their profession.
9. They would be instantly alerted to product recalls.
10. They would support a traceable supply chain.
11. They would have an endless source of new suppliers to review easily.
12. They would have product specifications at their finger tips.

There are any number of additional benefits to retailers and other companies when using Strategic Sourcing tools such as reverse auctions, online RFI’s and RFP’s. Not the least of which is that if a retailer were seriously to assign just twenty percent of their above the gross margin line spend to these types of tools, they could increase their net earnings by up to 100%.

We look forward to and appreciate your comments.