Archive for November, 2009

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Country of origin information needs to be a significant part of product traceability

Monday, November 16th, 2009

According to Wikipedia, Country of origin (COO) is the country of manufacture, production, or growth where a product comes from.

The Obama administration continues to seek tougher labeling laws on fresh meat and other food products from Canada. Canada continues to be an opponent to country of origin labeling. Mexico our other NAFTA partner also does not support this type of labeling and has actually filed protests with the World Trade Organization.

It troubles this author when North America has suffered the several of the largest food borne illness outbreaks in decades during the last two years that our local trading partners ignore this critical step in product traceability.

What we clearly continue to require is specific country of origin labeling. Standards tend to be inconsistent from country to country. By example products enter North America from Europe that may carry country of origin labeling like ?Europe? or ?EU? rather than specific labeling indicating a product comes from France or Germany.

Manufactured products create a more unique issue, as individual products may include up to hundreds of components, pieces and parts from dozens of countries and assembled in other countries. While this issue requires significant work, there is absolutely no reason that we can not include country of origin labeling on all food products that enter our country.

We appreciate and look forward to your comments.

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Seventy nine percent (79%) of college students would prefer to work for a green company.

Friday, November 13th, 2009

With all of the issues facing our planet, both future and present employees are weighing their decisions as to prospective work places on more than just money. Are your human resource procurement professionals savvy enough to your company green practices and policies to attract the best and brightest?

Procurement does not only relate to the products your company buys for resale or supplies that your company uses internally. If you ask a human resources (HR) professional they are in the procurement business as it relates to people. In fact many of the tools they use during the recruitment process can in fact be sourced to reduce their cost using reverse auctions such as background checks and drug screening kits. First however they need to get the best candidates to want to work for you. So, these are not the most important products for human resources professional to be concerned with.

The job of human resources when conducting an interview is to sell your company, to make it the first place someone wants to interview and the last place they want to leave once hired. Increasingly, the social conscience of your company is becoming a deciding factor as to whether or not quality candidates want to select you as a place to work. The first question this begs, is your human resources department in a position to clearly discuss your company?s corporate social responsibility programs and initiatives (CSR)?

In a conducted by experience.com of 2,774 college students, the following question was asked. If you had two job offers and one company was ?green? would that have an impact on your decision? A full seventy nine percent (79%) answered yes. Let?s hope your CSR program leads to the need to use the other products required in this process because your human resource professionals are armed with a strong story.

We appreciate and look forward to your comments.

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Becoming Green Certified; Thoughts on Equipment and Facility Changes:

Thursday, November 12th, 2009

With all the talk about becoming green today it is important to understand the necessary steps required to achieve that goal. A resource that many are not aware of that you can work with to accomplish your green objectives is your local government?s Green Business Coordinator. He or she can provide guidance if you have questions or need assistance meeting green requirements. There are also many rebate programs that can help compensate you for facility changes required in your green pursuit. Please take the time to speak with your Coordinator before beginning to go green.

Below are some steps you can take to move your facilities in a green direction.

1. Mount occupancy sensors on lighting fixtures in low occupancy areas.
2. Upgrade incandescent bulbs to compact fluorescent lights.
3. Install ultra efficient ballasts unit to mute lights to benefit from daylight.
4. Control lighting, refrigeration and HVAC with an energy management system.
5. Improve present fluorescent lighting with T-8 lamps with electronic ballasts T-8 systems use up to 40% less energy than T-12 systems).
6. Put in a programmable thermostat to manage heating and air conditioning.
7. All major hot water pipes should be insulated.
8. Refrigeration cold suction lines should be insulated.
9. Plant shrubs or trees near windows for natural shade.
10. Fill air gaps around doors and windows with weather stripping.
11. Choose electrical equipment with energy saving features (e.g. Energy Star).
12. Use computer hardware programs that conserve energy by automatically turning off idle monitors and printers.
13. Install plastic strip curtains on refrigerator and freezer doors.
14. Upgrade hot water heaters to on-demand systems.
15. Install a solar powered water heater or pre-heater.
16. Decrease the number of lamps and increase lighting effectiveness by installing optical reflectors or diffusers.
17. Add desk lamps to work spaces in to reduce the need for overhead lighting.
18. Install ceiling fans to circulate air.

We hope these steps help with your thinking in your road to becoming greener company.

We look forward to and appreciate your comments

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What is the Green Power Partnership and who are the leading retail organizations?

Wednesday, November 11th, 2009

From the GPP website, we learn that The Green Power Partnership works with a wide variety of leading organizations ? from Fortune 500 companies to local, state and federal governments.
The Green Power Partnership works with a wide variety of leading organizations ? from Fortune 500 companies to local, state and federal governments, and a growing number of colleges and universities. The following Top Partner Rankings highlight the annual green power purchases of leading organizations within the United States and across individual industry sectors.

These green power purchases help reduce the environmental impacts of electricity use and support the development of new renewable generation capacity nationwide. Purchase amounts reflect U.S. operations only and are sourced from U.S.-based green power resources. Organizations can meet EPA purchase requirements using any combination of three different product options (1) Renewable Energy Certificates, (2) On-site generation, and (3) Utility green power products.

Purchase figures are based on annualized Partner contract amounts (kilowatt-hours), not calendar year totals. These rankings are updated on a quarterly schedule. Find out how your organization can partner with EPA today! To view a top partner list, select from the chart below:

The Top 20 Retail list represents the largest purchasers among retail partners within the Green Power Partnership. The combined green power purchases of these organizations amounts to nearly 2.8 billion kilowatt-hours of green power annually, which is the equivalent amount of electricity needed to power more than 276,000 average American homes each year.
Annual Green Power Usage (kWh)

1. Kohl’s Department Stores
2. Whole Foods Market 3. Wal-Mart Stores, Inc. / California and Texas Facilities
4. Starbucks
5. Staples
6. Lowe’s
7. Safeway Inc.
8. REI
9. H-E-B Grocery Company
10. The Est?e Lauder Companies Inc. / Operations
11. FedEx Office
12. Gander Mountain
13. Giant Eagle, Inc.
14. The North Face
15. Aveda Corporation
16. Office Depot
17. prAna
18. Half Price Books / Texas Facilities
19. Macy’s, Inc. / California and Hawaii Stores
20. Origins

SafeSourcing offers it congratulations to these companies that help to create a better environment for coming generations through their green efforts.

We look forward to and appreciate your comments.

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What is the United States Green Building Council or USGBC?

Tuesday, November 10th, 2009

This author believes that the single largest opportunity for impacting our environment is in making our buildings greener. This week, the U.S. Green Building Council hosts the world?s largest green building conference and expo, Greenbuild, coming to Phoenix, Ariz., Nov 11-13, 2009. If you are not attending and are interested in joining as a company or individual member please read on and visit the following links.

USGBC National Membership:

Employees of USGBC National member organizations earn major discounts on workshops, reference guides, Greenbuild registration, and LEED professional accreditation. Member organizations also receive decreased project registration and certification fees. The future of green building is shaped by USGBC members who join committees–the core of the consensus-based process that develops LEED, educational offerings, Greenbuild, and other programs. And of course, there?s the networking -? members-only events are held across the country in conjunction with many major conferences.

Individual Chapter Membership:

If you are an individual interested in promoting green building, or even if you work for a USGBC National Member company, Chapter membership allows you to get plugged-in with education, networking, and advocacy efforts that will enrich your neighborhood, city and region. Take it a step further by taking a volunteer leadership role in the chapter, or assist in developing education, information and outreach programs that are specific to your local industry and social community.

Please remember that certifying the products you buy and the buildings you build today as green can mean a better environment for our future generations which are also your future customers. Please include green building in your corporate CSR initiatives.

We look forward to and appreciate your comments.

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Why do I continue to harp on green building initiatives for retailers?

Monday, November 9th, 2009

According the United States Green Building Council or USGBC one of the largest potential impact areas on our environment is our buildings. In the United States buildings account for the following.

1. Seventy two percent (72%) of electricity consumption.
2. Thirty nine (39%) of energy usage.
3. Forty (40%) of raw material usage.
4. Thirty (30%) of waste output.
5. Fourteen (14%) of potable water consumption.

So the reason I continue to harp on green building initiatives is that if you only have enough resources to focus on one environmental area in your Corporate Social Responsibility initiatives (CSR), focus on green buildings. When you build new facilities whether they are stores, distribution centers warehouses or office buildings, build them to The Leadership in Energy and Environmental Design (LEED) standards. When you buy products or services, buy them from suppliers that do the same thing. This is a very easy process to implement and to build score cards to support. Now ask yourself the question as to how many of your suppliers follow LEED guidelines. This can even apply if you or your suppliers rent all of their facilities. Do they rent from real estate management companies or individuals that going forward are applying LEED standards to all of their building projects. If the answers are no, find other suppliers that do.

Ask your procurement solution provider to provide you with a list of two or three suppliers for all of your categories that follow LEED guidelines. You?ll be helping to build a better tomorrow for our children and theirs.

We look forward to and appreciate your comments.

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Traditionalist retailer thinking says e-negotiation tools will never work for them.

Friday, November 6th, 2009

On many occasions I have discussed the various benefits of using e-negotiation tools with retailers. I still believe that the primary benefit to any retailer if they were to assign twenty percent of their above the gross margin line spend to these types of tools could be an increase in their net earnings of up to 100%.

Beyond an earnings improvement however many of the following benefits could also take place.

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.

You might be wondering why many companies are not enjoying these benefits today The following are common objections you might hear daily from procurement knowledge workers that have not been exposed to e-negotiation tools in the past.

1. We already get the best cost.
2. We?ve done business with our supplier for years.
3. We don?t have product specifications.
4. We don?t have time for this.
5. Switching costs will be too high.
6. We can?t insure the same quality.
7. We need to adhere to certain standards.

If you don?t feel that these benefits would support both corporate goals and underlying CSR initiatives, give us a call and we?ll make you a hero and get you promoted.

As always, we look forward to and appreciate your comments

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Corporate Social Responsibility (CSR) can be your fuel for growth!

Thursday, November 5th, 2009

CSR is subject to a lot of debate as to whether there it has a strong business case. This author and many others argue that corporations benefit in multiple ways by operating with a broader perspective that will produce longer term benefits than their immediate, short-term profits. Others continue to argue that CSR distracts from the fundamental economic role of businesses.

In support of a well established CSR program, a 2008 study indicated that twenty six (26) percent of consumers indicated they planned to be consciously greener during the next year. Thirty four (34) percent indicated they would even be willing to pay more for it. These numbers continue to trend upward.

While many continue to minimize the impact of a well thought out CSR program, successful companies are building and measuring the impact of these programs with an increased focus on energy, waste, construction, carbon footprint, products, charitable giving, community action, food safety and the intersection of all of these components on their enterprise consituatants.

At the center of a good CSR program, is the ability to hold suppliers and other trading partners accountable to the same standards a company has set for itself. This however can not come at additional cost. As such, procurement solution providers play a huge part in ensuring that the following listed items are not only part of a well constructed CSR program, but are also included in the CSR programs or initiatives of your incumbent suppliers and potential new sources of supply. The following questions then become a good cross reference point as to what should be in your CSR program as well as that of your collaborating business partners.

1. What percentages of the products you carry are green or have undergone reformulation to make them more environmentally friendly?
2. Are you using reusable bags as a way to defer plastics from our landfills?
3. What are your utility reduction plans?
4. Do you have an energy reclamation plan?
5. Do you have a renewable energy program?
6. How are you or your suppliers making your fleets more efficient?
7. Are your new construction projects LEED certified?
8. What are your outbound or community education plans?
9. What community programs do you support?
10. What is your charitable giving program?
11. Do you have a CSR committee?
12. What are your product recall procedures?
13. How do you support product traceability?
14. What are your plans to protect your customers from food born illness?
15. Do you have a company certification cross reference map in place?

Ask your solution provider how they can assist you with this process.

We look forward to and appreciate your comments.

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H1N1 is on every front page and every news channel.

Wednesday, November 4th, 2009

Evidently at least 46 people have been affected with two resulting in two deaths to date in a new E.coli out break linked to ground beef produced by Fairbank Farms of New York. Fairbanks recalled over a half million pounds of its product on October 31st.

The issue now gets tricky for the CDC, involved retailers and Fairbanks of finding why and where the outbreak took place so as to not have it happen again. This may even involve tracing the product beyond the distributor. As such the proper traceability standards are still not in place to make this an easy task if required.

Precautions that procurement professionals can take to make sure they have necessary safeguards in place when buying meat products is to check the certifications their incumbent or future suppliers have on file? These may differ depending on the country of origin. Certainly SQF and GFSI certifications should be in place. Other potential certifications might include ISO 22000 as well as American Humane Certified, Certified Humane Raised & Handled and others. This should be a requirement of all supplier databases as well as the most recent certification dates and other practices that suppliers and processors may have in place that will mitigate risk that could lead to the cause of future outbreaks.

While meat products are a major contributor to E.coli outbreaks, other areas causing outbreaks? can be person to person contact, lake water and animal contact to name a few.

We appreciate and look forward to your comments

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Have you developed lean procurement practices?

Tuesday, November 3rd, 2009

The term “lean” as it applies to our subject was coined to describe Toyota’s business during the late 1980s by a research team headed by Jim Womack, Ph.D., at MIT’s International Motor Vehicle Program. According to lean.org; the idea behind lean organizations is to maximize customer value while minimizing waste. Simply, lean means creating more value for customers with fewer resources.

In Lean Thinking, by Jim Womack and Dan Jones, the authors suggest that companies or organizations think about three fundamental business issues.

1. Purpose: What customer problems will the enterprise solve to achieve its own purpose of prospering?

2. Process: How will the organization assess each major value stream to make sure each step is valuable, capable, available, adequate, flexible, and that all the steps are linked by flow, pull, and leveling?

3. People: How can the organization insure that every important process has someone responsible for continually evaluating that value stream in terms of business purpose and lean process? How can everyone touching the value stream be actively engaged in operating it correctly and continually improving it?

So, how does this apply to the procurement process? A typical misconception is that lean is suited only for the manufacturing process. This is not true. Lean applies in any and all businesses for any and all processes. Some areas you might consider relative to a lean procurement process would certainly include but not be limited to the following.

1. How many internal resources are dedicated and at what cost to procuring products and services for resale or internal use?
2. How much time do these resources spend to review and renew contracts?
3. How many new sources of supply are vetted regularly to insure you are receiving the best possible product at the best possible price?
4. How long have you been doing businesses with existing suppliers in every category?
5. What are your Procurement Key Performance Indicators and how often do you review them?
6. Do your Procurement KPI?s link directly with your corporate KPI?s?

Ultimately a lean organization understands both internal and external customer value and focuses its key processes to continuously improve both. Your solutions provider should have tools to help you evaluate your current process and suggestions as to how to reduce cost and infrastructure to support a lean procurement organization.

We look forward to and appreciate your comments.

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