Archive for the ‘B2b Supply Chain’ Category

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The economists say the recession has been over for more than a year.

Tuesday, September 28th, 2010

Finding new sources of supply has always been an issue. It may even be more important if your current suppliers can not provide what you need because they were forced to down size during recent economic woes.

This author has posted on numerous occasions relative to the importance of a robust retail supply chain and how retail companies might manage their relationships with current and new sources of supply. A significant part of the process is to have alternative sources of supply that you can rely upon. During last years H1N1 flu outbreak, The SafeSourceIt™ supplier database was able to provide multiple sources of surgical mask suppliers to a customer that had not been able to find them elsewhere for resale in their stores. Although this particular issue was caused by panic buying, it is still a supply and demand problem. The question this begs is are your suppliers capable of supplying your needs as demand increases? Did they reduce staff during the downturn? Have they been able to ramp up since then? Have their suppliers? The message here is, don’t wait until a time of panic or increased prosperity to work and plan for spikes in the supply chain that may cause your customers pain.

The SafeSourceIt™ Retail Supplier Database contains over 380,000 vetted global suppliers that are certified in over 25 different areas.

We look forward to and appreciate your comments

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Are you comfortable with your sources of supply? Are your suppliers comfortable with you?

Thursday, September 16th, 2010

Being comfortable is great. Sometimes however being to comfortable can also create complacency. We all know we have coworkers that come to work everyday and do what only what they perceive their job to be. Nothing extra is ever done, and few ideas come from these folks that are just comfortable with what they are doing and how they are doing it. They do a good job at it, but that?s it.

Let?s apply this type of complacency to knowledge workers in the supply chain. If we are being honest with ourselves; we see this situation all the time.

?A buyer you know has a list of products or a category manager has a category that they are responsible for. There are only so many hours in the day and they have a job to do in order to get product to a distribution center, warehouse, store or some other location on time. They have done business with the same suppliers for a number of years. In fact the person in the job before them did business with these same suppliers and the person before that. So its easy to not rock the boat. It takes to much time to look for new sources of supply and after all one can only manage so many relationships anyway. Finally the buyer is comfortable with product quality and pricing has not gone up to much over time.

With the help of your e-procurement solution?provider, this situation is easily rectified, but you need to be open to change. This is normally led from the top of the organization. The following is a partial list of what you can do to eliminate complacency and support the fact that you knowledge workers don?t have a lot of free time.

1.?Provide your e-procurement company with a list of your suppliers by category.
2.?Provide your e-procurement provider with a complete list of products carried by each supplier.
3.?As your e-procurement provider to produce a list of new sources of supply located within a fifty mile radius of each distribution center or warehouse
4.?Ask your e-procurement provider to provide data on each supplier?s including incumbent?s safety certifications such as GFSI and ISO.
5.?Ask your e-procurement provider to provide supplier background information such as years in business and user references.
6.?Select categories or products to source from your incumbents catalog and cross reference with new suppliers offerings.

The additional steps to this process can be provided by SafeSourcing as a part of our best practices deliverables which are included in our event pricing. The SafeSourceIt? Supplier database includes over 360,000 global sources of supply that can be sorted by a variety of filters such as country, county, postal code or mileage from a particular location, plus many more.

We look forward to and appreciate your comments

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Creating a small business network and collaborating creatively within is a great way to reduce your costs.

Wednesday, September 15th, 2010

So what the heck is collaboration and what are collaborative partners or networks relative to the supply chain. One thing is for sure, these terms roll of everyone?s tongue like we all know what we are talking about. So this author took a look at Wikipedia hoping to gain some insight and clarity.

According to Wikipedia, Collaboration is a recursive process where two or more people or organizations work together toward an intersection of common goals, and
An aggregate is a collection of items that are gathered together to form a total quantity.

Since collaboration only means different groups or organizations working together towards the same goal, that term can apply to just about any business function. However when we combine it with the word aggregate to form the collective e- procurement term Collaborative Aggregation which was coined by this author in 2006; we arrive at something potentially meaningful.

Collective buying organizations and sometimes share groups often combine purchasing volumes of like products to drive better discounts. Large companies often aggregate their purchases among departments and are more often today doing the same thing across different operating group?s or companies within a larger organizations to drive economy of scale in purchasing.

The unfortunate truth is that not much out of the box thinking is going on in this process. We are so involved in the process that we can not see the forest for the trees.

As an example let?s take a look at a small regional supermarket chain. Today they buy their products mostly from regional or national wholesalers who are able to aggregate the volumes of many small to medium size companies in order to earn enough discounts to pass on reasonable pricing to this retailer that is slightly better than the small chain might earn on their own.? The wholesaler also reserves a little for themselves in order to support their business. These products are normally for resale products. In the not for resale area or supplies, the regional retailer usually does business with local suppliers for a variety of supplies that can include everything from cleaning fluids to paper bags. The supplier normally does good job of managing these products against a number different cost structures to maintain a customer margin that is good for them. As an example if the price of oil is up and the resin market high, the supplier might be making less on plastic products such as plastic shopping bags, soup containers, trash can liners etc. The supplier may however also carry paper products and other supplies that can be mixed together to drive a total customer margin that is acceptable for their model. Retailers can do the same thing. Here?s a partial list of how collaborative aggregation can work.

1.?Take a good look at the total list of supplies offered from your primary supplier.
2.?Compare that to what you are buying from them.
3.?Ask your e-procurement provider for a list of suppliers within a 50 mile radius that can provide the same products or some of the same products.
4.?Look at local businesses within a five mile radius of your area that are not in your industry but buy some of the same products such as trash can liners, cleaning fluids, paper products etc.
5.?Call them and explain how collaborating might save you all money.
6.?Ask for the name of their supplier as they might be different from yours.
7.?Determine a test group of products to request bids on.
8.?Develop a standard specification.
9.?Develop standard terms and conditions.
10.?Bundle all products into one group.

SafeSourcing has a best practices program for this type of collaborative aggregation that is included in our event fees. For a complete list or more information please contact us at www.safesourcing.com.

We appreciate and look forward to your comments

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E-procurement.What’s in a definition?

Thursday, September 2nd, 2010

I was reading a blog post from the Doctor over at Sourcing Innovation today titled “A Hitchhiker’s Guide to e-Procurement: Terminology” and I thought it was great as well as very timely.

Ultimately it is up to practitioners and solution providers of these tools to educate their customers as to what the proper terms are for the tools they are using. As an example E-RFI, E-RFP, E-RFQ. I have numbers of customers that have used other solution providers and not only are the definitions different by customer; they are actually different within a specific company. In some cases everything is referred to as a reverse auction and in other situations the companies have made up their own name for the service or tool.

This author uses Wikipedia and Wictionary quite often as a source and in this case, they have a very good definition that covers most of the terminology in the entire e-procurement space as well as related B2B and B2C internet based or private network based functions. As your company moves in the direction of a computerized supply chain management solution for your company understanding what you are asking for and what you are using will make both your job and that of your solution provider easier.

We look forward to and appreciate your comments.

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E-procurement.What?s in a definition?

Thursday, September 2nd, 2010

I was reading a blog post from the Doctor over at Sourcing Innovation today titled ?A Hitchhiker’s Guide to e-Procurement: Terminology? and I thought it was great as well as very timely.

Ultimately it is up to practitioners and solution providers of these tools to educate their customers as to what the proper terms are for the tools they are using. As an example E-RFI, E-RFP, E-RFQ. I have numbers of customers that have used other solution providers and not only are the definitions different by customer; they are actually different within a specific company. In some cases everything is referred to as a reverse auction and in other situations the companies have made up their own name for the service or tool.

This author uses Wikipedia and Wictionary quite often as a source and in this case, they have a very good definition that covers most of the terminology in the entire e-procurement space as well as related B2B and B2C internet based or private network based functions. As your company moves in the direction of a computerized supply chain management solution for your company understanding what you are asking for and what you are using will make both your job and that of your solution provider easier.

We look forward to and appreciate your comments.

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Retailers here are twenty additional reasons why you ought to be running reverse/forward auctions.

Monday, July 26th, 2010

This author has posted a number of times on twenty reasons why retailers should use e-procurement tools including everything in the procure to pay process. I post that subject a number of times a year. Quite frankly there are many more than twenty reasons. Here is a different type of look at the same subject.

1.?It?s about the money.
2.?It?s not about the money.
3.?You don?t have specifications even if you think you do.
4.?You will have specifications once the event is complete.
5.?You have great relationships with all of your suppliers.
6.?You don?t have great relationships with all of your suppliers.
7.?You don?t know where to find additional sources of supply?
8.?You will have at least 8-10 new sources of supply for every category you run.
9.?All of your management team collaborate and make sure they aggregate their purchases. No they don?t.
10.?You are getting the best prices in the market according to your buyers.
11.?Believe me; you are not getting the best prices in your market.
12.?All of your contracts are less than two years old! Ha, Ha Ha! They should be.
13.?All of your overstock and out of cycle inventory has been removed from the back rooms of your stores! If it had, your shrink would be lower.
14.?You are aware of all of your suppliers green and safety programs?
15.?You are taking advantage of all of your suppliers green and safety programs.
16.?You are measuring all of your commodity purchases against the appropriate indices.
17.?You are getting the best use of your team because they have all the tools they need in order to source products and services efficiently.
18.?Your people could be spending more time on more important projects if they used low cost SaaS e-procurement tools.
19.?You have never had a contract auto renew or evergreen that cost you money.
20.?All products and services you buy are top quality because you evaluate them regularly.

If you can only find three issues above that plague your operation, then you should be using e-procurement tools. Call us today. We?ll do the first one for free.

We look forward to and appreciate your comments.

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We still need to question CHINA.

Tuesday, July 13th, 2010

There was a point in time that sourcing products from China insured a low cost for your product. Then the price of oil went through the roof and melting down containers returned more than trying ship product in them. Even with oil down somewhat from that time, costs are increasing in China as plant safety and quality and worker safety and quality improves. However, there are still probably bargains to be had, but caution should be your guiding word.

A great example of this is a recent find by Chinese officials of tons of milk products tainted with Melamine. If this sounds familiar, it should. This was an issue in 2008 on which this author posted. The scandal actually killed 6 babies and made hundreds of thousands sick at the time. China actually executed two individuals for producing or selling toxic milk. So here we are in 2010 and the problem has still not been totally corrected and we are talking about products that are only sold in China. It would seem that a country would be more concerned about the quality and safety of products made by the Chinese for the Chinese consumer.

As such, companies need to complete the due diligence necessary to insure that the products you are planning to source include detailed raw materials descriptions, formulas and certifications that are mandated globally to insure product quality, safety and environmental impact standards.

Ask your solutions provider what their vetting procedures are for including suppliers in their database?

We look forward to and appreciate your comments.

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In order to manage your retail supply chain, you first need to know what it is or isn’t.

Friday, June 25th, 2010

Managing a retail supply chain depending on how involved you want to become in the process includes your products and how they get to you, your consumer and the service you provide for the product post sale. This also includes all data about the product in a procure to pay process such as purchase order information, contract information and delivery coordination and status along the way. All of the above requires management of the related financial data such as payment terms and schedules and other financial data. A good place to start is to break this information down into manageable pieces and see how many people are involved in the process internally and externally and how they collaborate with each other if at all. To the extent that you can not connect the lines may include.

As a retailer, you are an obvious part of the consumers supply chain and in some cases also a supplier to other retailers. The network depends on the product but can include yourself,  raw material providers, manufacturers, wholesalers, distributors, third party logistic companies or 3PL’s, and other types of transportation companies. Managing the collaboration of your supply chain is what will ultimately differentiate you from your competition. It’s up to you.

As your procurement solution provider how they might tie all of these disparate organizations together for you.

We look forward to and appreciate your comments.

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Retailers do you use or do you even have time to use punch-out software?

Wednesday, June 23rd, 2010

A Punch Out is a feature of e-procurement software applications that makes it possible for buyers to access suppliers Web sites from within the buyer’s solution provider’s procurement application. The buyer leaves their solution providers system and goes to an alternative supplier’s Web-based catalog to find and potentially order products. This is also a good way to conduct research and gather information. A vendor catalog that is enhanced for this process is known as a punch-out catalog.

This author has always felt that this is a good way to buy products that you currently buy from alternative sources, but it does not replace the possible price compression and other benefits of from taking these products through the normal e-RFX process.

Ask your solution provider their opinion on this process.

We look forward to and appreciate your comments.

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Was the recent e.coli settlement a supply chain problem?

Friday, May 14th, 2010

We have posted many time on the need for a traceable supply chain and the need for better due diligence throughout the procurement process including plant, farm and other source inspections. Keeping this data in a format that is searchable in the supplier vetting process is paramount to mitigating risk to consumers, suppliers, manufacturers and other areas of the supply chain is just to great without it.

Cargill Inc. which is a great agribusiness announced yesterday that they were responsible for the life shattering injuries suffered by Stephanie Smith by eating a contaminated burger in 2007. The parties agreed to settle the law suite and the terms were not disclosed beyond that Cargill agreed to cover her care for the rest of her life.

The debate on food safety continues and as it does drives the need for compliance at all levels of the supply chain from the farm to the table and the capability of tracing finished goods from the consumer to the source in order to. Without these tools issues like this will continue to happen.

We look forward to and appreciate your comments.

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