Mayonnaise – Some Crazy Stuff Going on with Mayo!

January 30th, 2019

Is the Mayo category on the rise?

 

Today’s Post is by Eli Razov, Senior Account Manager at SafeSourcing Inc.

Is the Mayo category on the rise? The mayonnaise production industry is a $2-billion a year industry that continues to grow in North America. The global mayonnaise market is a $9.9 billion industry. This global market is anticipated to reach a value of $12.5 billion by 2023. That being said, the number of businesses in the North American industry has grown roughly 2% since 2015, with the number of employees growing 2.7%. Mayonnaise is consumed by a considerable amount of customers and forms the highest consumed category of food dressing worldwide.

So what is mayonnaise? It is a thick and creamy dressing used as a condiment in various cuisines. The standard mayonnaise is an emulsion of oil, egg yolk, and either lemon juice or vinegar with many other herbs and spices. Egg-free alternatives are also available in market for vegans and those allergic to eggs. Contrary to popular belief, the fat present in mayo is unsaturated, or “good fat”, as the oils used come from plant sources which in turn are sources of antioxidants and vitamins. The rising demand of egg-free products among vegans has boosted the growth of the mayonnaise market, making manufacturers turn to egg alternatives. Additionally, a change of consumers towards plant-based products is adding fuel to the demand. This is setting the foodservice world ablaze adding new types and styles of mayonnaise and aioli.

As far as packaging goes, mayonnaise can be found in jars, single-serve packets (sachets), bottles and buckets (for larger foodservice needs). Sachets are expected to witness high growth over the next five years due to its availability in various sizes and convenient packaging. That being said, we have run many single serve, foodservice and large quantity RFQ’s for our clients with an average savings of 17%. Now is a great time to look into taking your mayonnaise needs to market. With an ever growing demand, and a low market price, now is the time to strike.

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

 

Sourcing Events on Category Spends

January 29th, 2019

SafeSourcing’s professional service offerings support our mission of ……………..

 

Today’s post is by Alex Borbely, Vice President of Sales at SafeSourcing Inc.

SafeSourcing’s professional service offerings support our mission of providing information and services to our customers through e-procurement best practices that proactively support e-procurement events from category discovery to results analysis. As part of our full-service offerings, this also includes ROI delivery and focus on consumer safety and environmental standards in the global supply chain. Today, I would like to discuss a service of providing industry updates/news that may affect sourcing events on category spends.  We often play a role with our clients in keeping them abreast of changes in the marketplace and specifically what impact a commodity like corn can have on the pricing of items such as corrugated products.  Most items at your favorite supermarket, discount store, or shopping mall were safely delivered in boxes made of corrugated cardboard, and many are displayed in the same boxes, which were manufactured so they could be opened and used for this purpose. Other items may arrive in their own corrugated or alternative types of paperboard boxes. Because corrugated cardboard is such a versatile packaging material, millions of tons are used each year to protect and display products. Annually, more than 50 million tons of corrugated cardboard were produced in the United States. In addition, millions of tons of uncorrugated boxboard or paperboard are also produced for use in folding cartons.

Fast-growing pine trees provide the primary raw material used to make corrugated cardboard. The largest packaging companies own thousands of acres of land where trees are matured, harvested, and replaced with seedlings

At the corrugating plant, only a few other raw materials are needed to make a finished box. Corn starch glue is used to bond the corrugated medium to the liner sheets. Because so much glue is used, rail cars or large tanker trucks deliver it as a dry powder that will be stored in huge silos at the corrugating plant until it is needed. Drawn from the silo, the dry corn starch is mixed with water and other chemicals and pumped into the corrugator to be spread on the corrugated medium as the layers of liner are added.

When speaking with clients about corrugated spends it is important for the buyer to understand the components that go into the product and what impact those ingredients have with pricing such as corn.  There are a lot of factors that one needs to bear in mind such as the time of the year, supply and demand, hedgers/speculation traders, ethanol demand, and many other influencers that play a role in corn pricing and as a result the final product price of corrugated.

If you would like more information on how SafeSourcing can help you, please contact a SafeSourcing Customer Service representative.  We have an entire team ready to assist you today.

We look forward to your comments.

 

Procurement of Potato Salad Part Two: Potatoes

January 28th, 2019

What potato makes the best potato salad?

 

Today’s post is written by Heather Powell, Director of Major Accounts and Special Projects at SafeSourcing Inc.

What potato makes the best potato salad? That is a difficult question to answer because everyone has a different opinion based on heritage, location, and preference of taste or texture.

How do you purchase potatoes? Again, this varies on how and what you plan to do with them. Manufactures of potato salad, or even French fries, may purchase by the pallet. Smaller manufacturers or restaurants may purchase by the 50-pound bag.  Some purchase raw potatoes while others purchase steam peeled pre-cooked potatoes.

Are you concerned about the price you purchase potatoes? How do you know if you are paying the best price? Are you concerned about the source of the potatoes? Are you aware of how many hands or transfers your potatoes have gone through? How long were your potatoes stored somewhere and what were the conditions in which they were stored before they arrived on your dock? How do you re-coop money if there is more than 5% of spoilage?

All of these questions are valid and SafeSourcing, Inc. can assist you through answering all of the questions through producers and brokerages. Your first step to knowledge is learning what the market index is doing and what season the growers are in currently. Have you tracked weather patterns to see if the crop is forecasted to be a high yield year or a low yield year?  The Producer Price Index can serve as a leading indicator of ultimate price changes at the consumer level, and of inflation if the trend in the PPI is higher. Low inflation is good for stimulating consumer spending, corporate profits and ultimately the stock market. Increased inflation can be a sign of an overheating economy and potentially higher interest rates.1

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

This author hopes that you find this series fun and educational. In part three of the Procurement of Potato Salad, this author will provide procurement details for “creamy” details of mayonnaise for potato salad.

We look forward to your comments.

 

References:

https://www.investopedia.com/university/releases/ppi.asp

 

Market for Propane

January 22nd, 2019

I love grilling out! It is one of my favorite things to do...…………………….

 

Today’s post is by Ashley Riviello, Account Manager at SafeSourcing, Inc.

According to Trading Economics, propane was quoted at 0.68 USD/GAL on Thursday December 27, 2018. Propane reached an all-time high of 1.67 in February of 2014 and a record low of 0.33 in January of 2016. Propane is expected to trade at 0.71 USD/GAL by the end of this quarter, according to Trading Economics global macro models and analysts’ expectations. Looking forward, we estimate it to trade at 0.66 in 12-months’ time.

I have been working on an RFQ for a few weeks. This RFQ was actually one that I did on my own since starting back with SafeSourcing, Inc. I obviously had to do my market research and found out that propane has declined. Prices are going down drastically.

I love grilling out! It is one of my favorite things to do. It’s also something that most households in the US enjoy doing as well. Many appliances run on propane also. Obviously, the most common propane appliance is an outdoor grill; however, households can run almost exclusively on propane…from dryers to space heating.

According to the website Propane Deal (a website dedicated to having access to not only statistics about propane usage, but also where to find propane dealers near you), 47million people in the US use propane for grills and 14.3 million households run on propane. This accounts for about 4.5% of the population. The Midwest region has the highest residential propane consumption (8% of all households); Michigan is the state with the most residential propane users (6.6% of all homes). On average, a US household consumes 464 gallons of propane every year. That is a lot of propane for one household. Approximately 47-million people in the US use propane in their everyday lives.

If you are reading this, and you have a huge demand for propane, now is the time to find the best deal. The market is going down, but the need for propane is rising. Let us save you money on things you need in your everyday life. We have the ability to save you 5-30% annually on your propane needs.

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

References….………………………………………………………………………

  1. www.cdn.tradingeconomics.com/commodity/propane 2019
  2. www.propanedeal.com/basics/propane-usage 2018

It’s About Time

January 17th, 2019

How to know when it’s time to source that category?

 

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

As we continue to ramp up another year of providing eProcurement services to our customers, it’s a good time to consider what categories you’ll be sourcing this year. In an effective eProcurement program, every spend category should be considered at the appropriate time. But how do you know when it’s time to source a category?

One of the first considerations is contract timing. Unfortunately, many organizations today don’t have good controls in place to monitor contract terms. In some cases, the contracts are even missing because they were not saved in a central repository.

That’s where a contract management tool comes in. SafeSourcing’s contract management tool called SafeContract™is a great way to manage contracts and avoid the issues caused by losing track of your contracts and/or losing track of important contract milestones such as renewal dates and contracted prices.

SafeContract™ is an online contract repository that stores, tracks, and monitors your contracts. SafeContract puts you in control of your contract and notifies the appropriate users when it’s time to consider a category for eProcurement based on contract termination. For example, if the contract requires 30-day written notice before termination, a user might set a 60 or 90 day reminder so that they remember to take action. With SafeContract™, as your contract management tool, you’ll know when it’s time to consider sourcing a category. Not only will you know when to source your categories, you’ll also avoid missing deadlines for automatic renewals and other unfavorable outcomes.

Contact SafeSourcing if you’re interested in learning more about our contract management tool or any of our full suite of Procure to Pay tools such as SafeSurvey™, SafePO™SafeCatalog™, or any others.

For more information, please contact SafeSourcing.

 

Behind the Scenes

January 16th, 2019

How much work is done behind the scenes?

 

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

Every year there are highly anticipated movies and televisions shows that many of us just can’t wait to see. Two shows that have been highly anticipated, the final Avengers movie and the final season of Game of Thrones, are both set to be released April, 2019.

Because these shows are so highly anticipated with large fan bases, security surrounding filming, scripts, plot-lines, effects, etc. has been tighter than ever before. Despite all the added security, much is known or speculated about what these fan favorites will bring. One thing we know about these is that filming has long been over. Game of Thrones filming ended in July, 2018, nine months before its release, while Avengers: Endgame finished in January, 2018, a full 15 months before its release. So, why such the long gap in between?

The reason for the long gaps after filming is to allow ample time for all the work that needs to be done behind the scenes. This is a key part in any production and is often the most overlooked by those not involved in the process. For filming, this could include video editing, sound editing, special effects, and many other final touches. While actors and directors often get the spotlight for their work on a film piece, there are many more people working just as hard to create the final successful film or show that we all see and enjoy.

The ways the work is set up in film brings the idea that there are many other industries where a significant amount of work is done behind the scenes – procurement being one of those industries. A procurement partner is someone who works with your organization to help you obtain the goods and services you need, but there is a lot of work that goes into the position that may not be known to most. While a company can enjoy the end result benefits of getting exactly what they need at a competitive price, the procurement partner has done a lot of behind the scenes work along the way, from spend analysis, market research, supplier research, data analysis, product details and specifications, to term details. Just like the behind the scenes team for television and movies, a procurement partner can help make your sourcing efforts as successful and enjoyable as possible.

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

 

 

A Stinky Time for the American Cheese Industry

January 15th, 2019

There has been an increase of 13% of milk production in the last 10 years.

 

Today’s post is by Gayl Southard, Administrative Consultant at SafeSourcing, Inc.

According to the US Department of Agriculture, Americans consumed about 37 pounds of cheese per capita in 2017. Although that appears to be a large number, there is a 1.4 billion-pound cheese surplus. This is the largest cheese surplus in US history.

There has been an increase of 13% of milk production in the last 10 years. What dairy farmers didn’t realize was Americans are drinking far less milk. USDA statistics show Americans drank 149 pounds of milk in 2017, down from 247 in 1975. Milk suppliers turn the surplus milk into cheese as it’s less perishable and stays fresh longer. Studies show Americans are now in favor of more refined cheeses rather than processed cheese, although the market for mozzarella cheese is still the largest produced and consumed cheese in the US.

Imported cheese tends to cost more, so when consumers purchase these cheeses they tend to buy less. The growing surplus of American-made cheese and milk has resulted in a decrease in prices. Whole milk on average costs $15.12 per 100 pounds which is less than what dairy farmers need to break even. The Wall Street Journal reported hundreds of Wisconsin dairy farms closed in 2018.

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

References…..…………………………………………….

Samantha Raphelson, NPR Here & Now, 1/9/2019

 

What are supplemental documents?

January 10th, 2019

The definition of supplemental documents, also known as supporting documents or descriptive literature is.

 

Today’s post is from our SafeSourcing Archives

Supplemental documents are information, such as charts, illustrations, brochures, and technical data, supplied by a bidder on request as part of a Request for Proposal. It will describe the items offered in greater detail. It may also show the characteristics or construction of a product and explain its operation to enable the purchaser to determine the acceptability of the item.

Many RFI’s, RFP’s, and RFQ’s will require supplemental documents, or supporting documents within their specific projects. Traditionally, this information acts as a backup and provides greater depth to agreed-upon or quoted items.

Let SafeSourcing better manage your sourcing projects. We enjoy bringing this blog to you every week and hope you find value in it. 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.

 

Government Procurement: Bids and Contracts

January 8th, 2019

If anyone has ever seen the movie War Dogs...…………………...

 

Today’s post is by Ashley Riviello, Account Manager at SafeSourcing Inc.

If anyone has ever seen the movie War Dogs, it is a prime example of exactly how government procurement works, well at least how it worked back in the 90’s. In the movie, the government used procurement to buy weapons and ammunition on a large scale.

For anyone who doesn’t know what government procurement is, it is the procurement of goods, services and construction on behalf of a public authority, such as a government agency. With 10-20% of GDP (Gross Domestic Product), government procurement accounts for a substantial part of the global economy. Per Wikipedia, to prevent fraud, waste, corruption, or local protectionism, the laws of most countries regulate government procurement to some extent. Laws usually require the procuring authority to issue public tenders if the value of the procurement exceeds a certain threshold. Government procurement is also the subject of the Agreement on Government Procurement (GPA), a pluryilateral international treaty under the auspices of the WTO (World Trade Organization).

It has been amazing working at SafeSourcing and learning about all the different markets there are to take out to bid. However, it would be incredible to learn exactly what the government takes out to bid. The opportunity in Government Procurement is substantial. Government Procurement brings in about 7 trillion dollars annually.

The government buys many of the products and services it needs from suppliers who meet certain qualifications. The US federal, state and local governments apply standardized procedures by which to purchase goods and services.

For example, according to RFQ.com the federal government does not purchase items or services in the way an individual household might. Instead, government contracting officials use procedures that conform to the Federal Acquisition Regulation (FAR). The FAR is a standardized set of regulations used by all federal agencies in making purchases. It provides procedures for every step in the procurement process, from the time someone in the government discovers a need for a product or service to the time the purchase is complete. When the government wants to purchase a certain product or service, it can use a variety of contracting methods. Key contract methodologies used to purchase products and services include:

  • Simplified acquisition procedures
  • Sealed bidding
  • Contracting by negotiation
  • Consolidated purchasing vehicles

There are problems, however, with procurement within the government, such as the possibility of corruption. Like in movie War Dogs, you had 2 Americans that ended up corrupting the procurement process and stealing millions of dollars from the government and overseas officials by using the procurement process to hold fake bids and then collect the money on weapons and ammo and then buying them from the black market. The movie is based on a true story that happened in 2007. David Packouz and Efraim Diveroli ended up proving how corrupt Government Procurement could become. Worth the read? Maybe an upcoming blog.

For more information on SafeSourcing, or on our Risk Free trial program,  please contact a SafeSourcing Customer Service Representative. We have an entire team ready to assist you.

 

 

 

What does that have to do with the price of tea in China?

January 7th, 2019

Did you know that tea is the second most widely consumed beverage worldwide?

 

Today’s Post is by Eli Razov, Senior Account Manager at SafeSourcing Inc.

Did you know that tea is the second most widely consumed beverage worldwide? Global tea production exceeds $73-billion in sales and produces about 5.2 million metric tons of product a year.  About half of the world’s tea production comes from China, while India, Kenya, Sri Lanka, and Indonesia make up a large portion of the remaining tea market.  The tea market is broken into four segments: ready-to-drink tea (RTD), the traditional market; the specialty segment and the foodservice segment. So what does this have to do with us? Although coffee is often thought of as America’s preferred beverage, tea has quickly proven itself to be very popular in homes nationwide. A survey among U.S. consumers showed that 23 percent of participants drink tea every day, while only ten percent of consumers never drank tea at all. That is roughly 74,911,000 Americans whom drink tea every day! The majority of the tea consumed in America comes from the foodservice industry and ready to drink segments of the tea market. Most of this tea is purchased in gas stations, c-stores, and restaurants around the country. With that much consumption on a daily basis, the US tea market is a $7-billion industry.

We here at SafeSourcing have helped many of our clients run tea e-Procurement events, both separately and with other warm beverages together. With an average savings of 23%, we have helped clients save money on an ever growing market. A lot of foodservice companies sell tea and other beverages so it is easier to reach a higher spend when you combine the buying power of all your hot beverage needs. There are some instances where specialty companies need to be contacted for more particular blends of tea. That is where our vast database of suppliers and knowledge of the industry comes in. By working with SafeSourcing you can grow your pool of suppliers and save even more money on all of your tea needs!

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