Archive for the ‘Supply Chain Procurement’ Category

A simple supplier scoring system may provide key performance indicators for the future.

Thursday, July 15th, 2021

 

Todays post is by Ron Southard, CEO at SafeSourcing Inc.

Having a large international supplier database to drive sustainable results in e-procurement events such as ant e-RFX function is critical to that events success. Maybe even more critical is making sure that the suppliers once selected for participation in an event are of the highest quality, professional, responsive and have your best interests at heart. There are several areas in the early strategy stages of a  an e-RFX process which if properly monitored can be leading key performance indicators as to future performance. These KPI’s are; the initial supplier response and supplier training schedule adherence. If suppliers are not interested enough during these early stages, this may be an indicator of future performance in other more critical areas such as on time delivery, back order management, documentation and audit compliance.

A reasonable process for measuring these KPI’s would be to measure the number of days between the project start date or initial supplier contact and the event start date, where the supplier has been sent an invitation but has not responded either positively, negatively or given a reason  for their response. Maintaining an active status of response dates could be scored based on the number of days it takes invited suppliers to respond. The longer it takes a invitee to respond the lower KPI score that supplier would receive.  Another possible KPI measurement or filter once the invitation has been accepted would be the number of days between the date accepted and the event start date, where the supplier has accepted an invitation but has not completed their automated training.

These are not intended to be punitive measures. In most cases suppliers will perform beyond your expectations. Sustainability and quality require measurements regardless of how simple.

If you’d like to learn more about The SafeSourceIt™ Supplier Database, please contact a SafeSourcing customer services account manager.

We appreciate and look forward to your comments.

Effective Supplier Data Management Improves Procurement Process

Tuesday, July 6th, 2021

 

This may be old, eight (10) years in fact. Its still no less true today then it was then.

The following excerpt is from the above titled article.

There is more to an effective e-procurement program than cost reduction.

While buyers frequently record cost reductions in the range of 30% to 40% when utilizing an e-procurement or reverse auction process, the issues of quality and performance cannot be overlooked.

The foundation for successful e-procurement is the supplier database
that has been developed and is maintained by the e-procurement service provider. Significant time and capital investment goes into the development of an effective supplier database. It provides the buyer with a recognizable advantage in terms of classification of supplier capabilities, historical performance and the quality of the products provided.

The scope, accuracy and functionality of the supplier database are critical components for buyers when using e-procurement. These elements allow buyers to identify the best sources of supply quickly and cost-effectively, oftentimes uncovering alternative sources that were previously not even considered. This is one of the major advantages of including the services of an online reverse auction service provider like SafeSourcing in the procurement process.

Supplier data management is an excellent example of pairing technology advancements with intellectual property to produce an effective, economical support tool that benefits both suppliers and buyers – better pricing, better quality and better sources of supply.

Click here in order to view the entire article.

We look forward to and appreciate your comments.

Is the inclusion of freight in an e- bid or reverse auction equal to the net landed cost?

Wednesday, May 5th, 2021

 

Todays post is from the SafeSourcing Archives.

Sourcing freight lanes or shipping lanes is a project all its own. A shipping lane simply put is the general movement of products between two areas. The first is the departure area and the other is the arrival area. This gets more complicated when we start to discuss full loads versus less than full loads and haul back opportunities that accomplish the optimum in a transportation cost model.

When you structure your e-bid simply asking for a net landed cost or assuming that means free freight or free freight within a certain radius of the origination point,  is just not that easily accomplished.

If you really want to understand your net landed cost, then you should have line items in your event that are specific, measurable and bid on separately. When a company says they want a net landed cost what they are referring to is the cost of a product or products plus all of the relevant logistics costs, such as transportation, warehousing, handling etc. In other words, what’s my cost when it gets here or where we want it?

If you want to drive the best pricing and service possible you need to understand what you are asking for and make sure it is clear in your specifications and terms and conditions.

We look forward to and appreciate your comments.

Reverse Supply Chain Management or Reverse Logistics!

Monday, May 3rd, 2021

 

Today’s re-post is from our SafeSourcing Archives.

We’ve spent years perfecting how to get “stuff” from in the dirt where we found it, make it more useful, and put it into consumers hands. This is called “logistics”. But now we’re faced with the task of figuring out how to do the opposite, without destroying the planet we got it from.

Enter Reverse Supply Chain Management (RSCM) or “Reverse Logistics as it’s sometimes called. The short definition of RSCM is to capture value from end of life products, and to take them backwards into the supply chain and/or reintroduce them into the biosphere/technosphere through a sustainable and profitable system. This can include activities such as reacquiring ownership of used products from the end user back to the manufacturer or reseller, transportation of used products for sorting, evaluation and designation of products for their most profitable use, remanufacturing or refurbishing, creating secondary markets for reclaimed products, recycling back to base components and responsible disposal.

One example of RSCM is the relatively new business of “Deconstruction”. In this process buildings are taken apart based upon material component value. These materials are either re-used in new construction, recycled into raw materials, or disposed of through environmentally sustainable means. Total annual building materials (C&D debris) disposed of in landfills in the US each year is not tracked by the EPA, but estimates range between 170 and 600 million tons disposed of in landfills currently, typically with only certain metals ever being collected and recycled from the debris. Organizations pioneering this field can be found at http://www.bignyc.org/, http://www.lifecyclebuilding.org/, and www.bmra.org.

Another example of businesses capturing value from RSCM is Dupont, which achieved zero-landfill status at one of their facilities that allowed them to realize $2.2 million in revenue in 2011 from the sale of waste by-products, and $400,000 in cost avoidance (http://www2.dupont.com/inclusive-innovations/en-us/gss/sustainability/employee-engagement/landfill.html). Similarly Subaru, GM, Honda, and Burt’s Bee’s have captured additional revenue or cost avoidance by repurposing waste through reverse logistical processes (http://www.greenmanufacturer.net/article/facilities/manufacturers-gone-zero-landfill).

The challenge is that reversing the supply chain for products that have been modified in an infinite number of ways over their usage life is exponentially more complex than taking virgin material to end consumer product. The premise to that problem however, should be that not engaging this process now while it’s optional, only makes what will certainly become a necessity more complex the longer it’s postponed, and presents a large opportunity cost every year potential new savings/revenue is not captured.

We at SafeSourcing have a knack for finding markets and cost avoidance opportunities that most don’t aren’t even aware exist. 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.

Understanding the Relationship Between Procurement and Marketing

Thursday, April 8th, 2021

 

Todays post is from our SafeSourcing Archives

The relationship between a retailer’s Marketing and Procurement Departments has been one struggling to maintain cohesiveness in many companies for quite some time.

While the Marketing team is continually trying to find creative and cutting-edge ways to increase sales within a retail organization, Procurement is constantly looking for ways in which to not only reduce costs, but find the best fit of suppliers with their company.

In many cases, marketing will expend a good deal of effort to find vendors to work with them on projects that when turned over to the procurement team can’t even be considered because their price is too high.  In the end this costs the company money, creates continued division between departments, and causes unnecessary lost time and sales.

Studies and reports have shown, and we at SafeSourcing agree, that the involvement of the Procurement department, even at the most basic level, into marketing projects can reap huge benefits as both departments work toward finding partners in their suppliers to achieve both their marketing and procurement objectives.

Retailers whose Marketing departments can leverage the database of the Procurement department’s suppliers will find a positive effect on their spend while achieving the ROI they are looking for on their campaigns and will create a better team environment within the company to achieve like-minded goals.

For more information about how the SafeSourcing database of known suppliers can help your company’s marketing and procurement departments work together to achieve these goals, please contact a Customer Service representative today.

We look forward to and appreciate your comments.

The Supplier Selection Process

Tuesday, March 30th, 2021

 

Today’s post is from our archives at SafeSourcing.

In brief, here are few steps to selecting  the proper suppliers   in order to provide the best goods or services at the best prices and in the right time frame and location for your specific business needs. This process is broken down to a few select categories to assist you in doing so. While there are certainly others, this will get you off to a good start.

Price – A key consideration for choosing suppliers is affordability. Competitively priced suppliers are usually the most attractive option. Affordability does not always represent the best value for money. If the quality of your supplier’s product is subpar, you may incur additional costs for returns and replacements, and risk losing business. If you decide to pass poor quality on to your customers, you risk damaging your business reputation.

Reliability – Reliable suppliers deliver the right goods or services on time. Large suppliers are generally more reliable because they have enough resources and systems in place to make sure they can still deliver if the unplanned happens, which it usually does.

Stability – You will want experienced suppliers with a proven track record. Stability is important, especially if you are entering into a long-term contract with a supplier or they are the only supplier of a particular item critical to your business.

Location – Consider location when selecting suppliers. Dealing with distant suppliers might mean longer delivery times and extra freight costs. When lead time is the most critical, a local supplier might be a better option. I recommend investigating freight policies of distant suppliers. Bulk orders, for instance, might get you free shipping or you might be able to combine different orders to reduce costs.

In addition, your might  also want to consider financial strength, existing user references, specific industry certifications and programs that support your companies social responsibility initiatives.

SafeSourcing would like to assist you with your supplier selection process.  Our SafeSourceIt™  Global Supplier Database already contains much of this  information. In order to learn more as to how we can help you with your specific procurement needs or about our “Risk Free” trial program, please contact a SafeSourcing Customer Service Representative. We have an entire customer services team waiting to assist you today.

 

 

 

HAPPY NEW YEAR 2021 from Safesourcing; Your GLOBAL SOURCING PARTNER!

Friday, January 1st, 2021

 

picture of world

 

If you’d like to learn more about alternative sources of supply around the world or locally, contact a SafeSourcing customer services account manager to learn more about SafeSourceIt™ our 427,000 global supplier database and let us translate it into increased profits for you.

We look forward to and appreciate your comments.

Thanksgiving and Black Friday is really a story of a supply chain found and developed!

Friday, November 27th, 2020

 

Todays post is by Ronald D. Southard, CEO at SafeSourcing Inc.

Happy Thanksgiving Weekend from SafeSourcing

One hundred and two pilgrims and crew arrived in Massachusetts after a 3,000 mile trip from England on the Mayflower. It is safe to say that as a result of that distance there was no existing supply chain to leverage, so one had to be developed and quickly. This began with basic hunting and gathering and later included trading with the areas indigenous peoples known as the Wampanoag’s for corn, seed and foraging and planting techniques.

The Thanksgiving holiday we celebrate today really stems from the feast held in the autumn of 1621. Since the pilgrims had only arrived on November 21st of 1620 they had really not been there long enough to develop a fully reliable and renewable supply source. They had however established collaborative relationships with the local Wampanoag people who became regular trading partners and who helped them celebrate the colony’s first successful harvest.

The most detailed description of the “First Thanksgiving” comes from Edward Winslow from A Journal of the Pilgrims at Plymouth, in 1621:”Our harvest  being gotten in, our governor sent four men on fowling, that so we might after a special manner rejoice together after we had gathered the fruit of our labors.

The fowl referred to above certainly could have included a wide range of fowl that was plentiful in the area such as wild turkey, pheasant, goose, duck, and partridge and unfortunately by today’s standards even eagles.

The pilgrims probably didn’t have pies or much of anything sweet at the harvest feast because they did not yet have ovens. They had brought some sugar with them on the Mayflower but by the time of the first Thanksgiving, the supply had probably run out.

Their meals also included many different types of meats. Vegetable dishes, one of the staples of today’s Thanksgiving, didn’t really play a large part in the feast. Other items that may have been on the menu certainly included sea food such as clams and lobster, Indian corn, wild fruits and nuts, meats such as venison and seal and certain dry herbs and spices.

The Thanksgiving meal that has today become a national holiday is a symbol of supply chain cooperation and interaction between English colonists and Native Americans.

We look forward to and appreciate your comments.

Happy Thanksgiving.

Let’s play supplier poker if you dare!

Monday, September 14th, 2020

 

Todays post is from Ron Southard, CEO at SafeSourcing Inc.

Let’s play supplier poker! Then we’ll find out how good your current supplier data is.

If this were a real poker game, I’d raise our big supplier data versus your existing supplier data.

Locating, managing and updating supplier information that companies choose to do business with has never been more difficult. How many companies that you used to do business with 4-5 years ago are no longer in business? How many new companies have taken their place? I already know the answer you are going to give me. It’s I don’t know.

We keep hearing about big data. With new regulatory requirements emerging daily, economies failing, the supply chain shrinking in some places and expanding in others,  changing  safety factors and  environmental factors ( think LEEDS), detailed supplier information and traceability are but a few of the issues that require regular maintenance in order to mitigate a company’s risk.

Solution Providers like SafeSourcing that provide supplier databases (SafeSourceIt™) that are part of automating the procurement process, need to step up and make sure that their data support these changes on a regular basis to the greatest extent possible by providing tools that interacts with both regulatory agencies and suppliers to insure consumer safety and environmental impact as more new sources of supply and new products enter the supply chain on a daily basis.

Actions that solution providers can take should include but are not limited to:

1. Monitor daily alert data as to product recalls and safety warnings.
2. Trace warnings back to the original source of supply automatically and maintain history.
3. Require that suppliers meet certain safety certifications in order to participate in their database.
4. Require that suppliers meet required environmental certifications or programs in order to participate in their database
5. Provide a regular purge of suppliers that do not comply with necessary standards.
6. Validate the entire database regularly for companies no longer in business
7. Adhere to a strict RFI process for new suppliers requesting participation in their database.
8. Provide a rating system for suppliers that are offered to companies as new sources of supply.
9. Monitor regulatory agencies such as ISO for new standards and include them as further requirements in supplier databases.
10.Conduct on going category research for evolving sources of supply.
11.Compare your best customers GL to your database for additions deletions.

Ask your solution provider what their process is to grow manage and maintain their supplier database for your benefit.

If you’d like more information on the SafeSourceIt™ Supplier Database of over 427,000 cleansed global sources of supply, please contact a SafeSourcing customer services account manager.

We look forward to and appreciate your comments.

Knowing Who Your Suppliers Are – Onsite Visits – Part II of II

Friday, April 3rd, 2020

 

Yesterday we posted  about the importance of onsite visits with your suppliers, how to prepare, what to look for, and the value of performing these visits.  This week we will be taking a look at some of the additional things that you need to think about when visiting a supplier in another country.

Visits to international sites will need to encompass the same types of information gathering as a domestic one such as reviewing the cleanliness of the facilities, observing production, logistic and storage processes, but there 3 important areas that must be considered in addition to these that may determine the success or failure of the visit.

Language – Assuming you are visiting a supplier that is not located in a predominantly English-speaking country, the capability to communicate onsite is an important one that should be addressed well in advance of the visit.  Many times the supplier will have staff that is fluent in more than language and can act as an interpreter, however procuring your own interpreter is also a suggestion and possibility. Also, some basic considerations of your own communication style would be to speak more slowly than usual and pause in between sentences to be understood more easily.

Culture – This is an important area to prepare for because in some countries seemingly minor things can create a tense atmosphere.  Determining whether to bow and the details surrounding when and how, if the country shakes hands when they greet and which hand they shake with are all important items in some countries and should be learned prior to your visit.  On the other hand, it is equally important to note the things that are normally unaccepted behaviors in the U.S. which many times are not viewed the same way in other countries.  Americans would generally never answer a phone call in a meeting or show up to an appointment late, but in other countries these behaviors are far less important and frequently occur during the course of doing business.

Capturing the details – Visits to international suppliers generally come with a price tag that is not insignificant to your company, so capturing as much data as possible is important on these visits.  Wherever you go during your visit take a notepad and camera with you to record what you see and hear while on the visit.  Many manufacturers will allow you to take occasional pictures as long as you ask in advance and have it cleared.  Some may not allow it and others may allow it as long as no employees are included in the pictures.  Capturing these details will be very useful to you and your team in the future and can potentially save trips for other employees in the future.

Onsite visits to your suppliers are incredibly valuable and important to your organization and are a terrific tool for knowing who your suppliers are and how they do business.  They are also important forums to gather details necessary for later contract negotiations.

If you are interested in locating potential new sources of supply, please contact SafeSourcing.  The SafeSourceIt™ Supplier Database contains 457,000 globally.

We look forward to and appreciate your comments.