Archive for the ‘Sourcing Strategy’ Category

Nuts Pack a Powerful Punch!

Tuesday, February 27th, 2018

 

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

Nuts are the little snack that is known to pack a powerful nutritional punch!  There are several tree nuts that are considered a great source of gluten free nutrition. Research has shown that nut consumption has consistently been found to be associated with a reduced risk of cardiovascular diseases.  Here are a few nuts that we’ve sourced:

Almonds
The US is the largest market for almonds, with about 30% of the crop sold for domestic use. About 52% of all almonds produced go into retail products, 20% go to foodservice applications, and the remaining 28% is used for bulk sales and snacking. Seventy percent of the almond crop is shipped internationally with Spain, Germany, Japan, China and India being the leading export markets. Today, 80% of the world’s supply of almonds comes from California. When compared ounce for ounce, almonds are the tree nut highest in protein, fiber, calcium, vitamin E (alpha-tocopherol), riboflavin and niacin. Among tree nuts, they are the best source of six of the 13 nutrients for which there are Daily Values (DV), and among the lowest in calories.

Cashews
Today the principal producing countries of cashews are India, Brazil, Vietnam and Mozambique.  Cashews are marketed in the shelled, roasted and salted forms for use as a snack and as an ingredient. Although cashews are one of the lowest-fiber nuts, they are packed with vitamins, minerals and antioxidants. These include vitamins E, K, and B6, along with minerals like copper, phosphorus, zinc, magnesium, iron, and selenium, all of which are important for maintaining good bodily function. Cashews contain a lot of vitamins and nutrients, but they also contain a lot of fat. The good news is that these fats are mostly monounsaturated and polyunsaturated (the healthy fats).

Pecans
The principle producing countries for pecans are the U.S., Mexico, Australia and Israel. Pecans are marketed in in-shell or shelled form and can be eaten raw or roasted. Pecans are the top nut and are among the top foods to contain the highest antioxidant capacity. This means pecans may help decrease the risk of cancer, neurological diseases and coronary heart disease. Pecans contain over 19 vitamins and minerals, including vitamin A, vitamin E, folic acid, calcium, zinc, magnesium and potassium.

Consumption of nuts has been linked to cancer prevention, heart health, and weight maintenance. They are packed with the vitamins and nutrients essential to good health.  Nuts are a great source of healthy nutrition, and SafeSourcing is your source for e-Procurement.

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.

Sources……………………………………………………………..

U.S. Department of Agriculture, Agricultural Research Service. 2010. USDA National Nutrient Database for Standard Reference, Release 23. Nutrient Data Laboratory Home Page, http://www.ars.usda.gov/ba/bhnrc/ndl
Texas Pecan Growers Association, www.pecans@tpga.org

Do you keep your receipts?

Friday, February 16th, 2018

 

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

Many of us use our debit or credit cards every day and by the end of the week, wind up with a stack of receipts. My receipts wind up cluttering my purse and pockets until I make it to a trash can, because the majority of the time I don’t even need them. While having so many receipts was previously a minor nuisance, after learning more about what it takes to make those receipts, avoiding receipts all together may be a better way to go from now on.

Receipts are typically made of thermal paper and are coated in different chemicals that react to heat, which causes the print to appear on the receipt. One such chemical used in thermal paper is Bisphenol A (BPA), which has been noted as a health and environmental hazard. This certainly makes me want to turn down a receipt next time I’m offered one, but sometimes a receipt is necessary.

Last October, a chemical plant in China made headlines that it would be shutting down for environmental reasons for at least several months. That plant produced a chemical that is used in thermal paper and it is estimated that it provided 70% of the world’s supply. At first glance, many might think this has no bearing on their lives, but it may very well affect every one of us.

When that particular Chinese plant shut down, thermal production paper slowed across the market. While other producers of the needed chemicals stepped up production, they struggle to make up for the difference, and that affects pricing. As prices rise, retailers begin looking for new suppliers or alternatives. One of the best ways to do this is to implement your procurement partner in your searches. They can assist not only with cost avoidance, but also with research of thermal paper alternatives, the effects thermal paper on health or the environment, or what it would take to make your point of sale digital.

For more information on how SafeSourcing can help your organization avoid cost increases or on finding new alternative technologies, or on our Risk Free trial program, please contact a SafeSourcing Customer Service representative. We have an entire team ready to assist you today.

 

Swim Like A Shark

Thursday, February 15th, 2018

 

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

As you read this today, imagine the image of a great white shark. Perhaps, you’re picturing it attacking its prey as in one of those nature documentaries. I simply picture the great white shark swimming through the water. I’d wager that when you think of sharks, you don’t immediately equate that image to those of us in the procurement field. But should you? In my own observations, I see sharks as powerful creatures that possess the tools and the skills to execute against their goals. For sharks, those goals are all related to hunting and survival.

Procurement professionals are sharks. Their goals also include hunting and survival. They hunt for savings and they are critical to the survival of any organization.

Sharks, as hunters, have incredible focus. If you try to imagine how to think like a shark, you may imagine being on the hunt looking for the splashing motions of a tasty meal. If you’re in procurement, you are looking for contract expirations, the length of time since categories have been competitively sourced, Market conditions, and other key indicators that tell you when you need to focus on a particular category. Once you have your sights set on a category, you are focused and driven in the hunt for savings.

To swim like a shark in procurement is to adopt the traits of the shark in your own behavior. A shark would not be deterred by some of the traditional objections to sourcing a category. Sharks would not care that the vendor has been a partner for 15 years. Sharks would not care if the vendor rep plays golf with the Vice President every week. Sharks expect a price decrease based on indices, not just increases. Sharks would see the potential savings objectively and would apply determination and ferocity until it had completed the task at hand.

One more interesting trait of sharks is their confidence. Sharks seem to know that they are sharks. Great white sharks appear to realize their place in the food chain. Procurement professionals too should know that they are sharks and realize that they have a very important role to play as well.

Go and swim like a shark. For more information, please contact SafeSourcing.

We look forward to your comments.

The High Cost of Baking with All Natural Ingredients

Friday, February 2nd, 2018

 

 

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

Gerry Newman, owner of Albemarle Baking Co., in Charlottesville, VA, buys vanilla for his business. Just a few years ago one-gallon of organic, fair-trade vanilla was $64.  In June of 2017, that same gallon is $245.  It is a global phenomenon for pastry chefs and ice cream makers.  Some businesses have changed their recipes to use less vanilla or have switched suppliers to find a cheaper product.  “It’s not certified organic.  It’s not fair trade, he says.  There’s guilt I have over that, because we’re talking about something that’s all hand labor, and if these people aren’t being treated fairly, it’s really sad.”

Harvesting vanilla is one of the most labor-intensive foods on Earth. Vanilla beans are from the seeds of an orchid.  It grows wild in Mexico where birds and insects pollinate the flowers; however, most vanilla now is grown in Madagascar where the pollination is done by hand.  After the seed pod has been harvested, the pod is soaked in hot water, it  is then wrapped in woolen blankets for roughly 48 hours, and then placed in a wooden box to sweat.  The pods are then laid out in the sun to dry, but only for one hour each day.  This process takes months.

There was a period of low prices for vanilla that many farmers abandoned their farms. A lot of companies had switched to a synthetic version of vanilla.  Synthetic vanilla is much cheaper than natural vanilla.  The package declaration may read “vanillin” or “artificial flavors”.

A savvy shopper prefers natural ingredients. Three years ago, Nestle and Hershey’s announced they were shifting to natural ingredients.  They wanted vanilla from orchid seeds.  That is when the supply did not meet the demand. The cost of vanilla beans in Madagascar costs more than 10 times what it did five years ago. Good news for farmers, but not so god for bakers.

Farmers in Madagascar are now rebuilding vanilla plantations as quickly as they can, but it takes 4-5 years before those orchids start producing seeds. Last March a cyclone hit Madagascar, destroying a third of the crop.  Also, theft has become a major problem for farmers.

For more information on SafeSourcing and how we can help you 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.

Resources————————————————————

https://www.npr.org/sections/thesalt/2017/06/16/527576487/our-love-of-all-natural-is-causing-a-vanilla-shortage

Satellite Versus Cable TV

Friday, December 22nd, 2017

 

 

Today’s post is by Troy Lowe; Vice President of Development at SafeSourcing.

Well it’s been about 6 months since we cut the cord and got rid of our satellite television service.  I’ll have to admit that it was hard at first.  Well, I thought it was hard at the time, but looking back it was just getting used to different types of menus for finding the content that we like to watch.

One of the first things we did was buy a TiVo and an over-the-air (OTA) antenna so that we could record and watch all the local channels for free.  Because we are in the middle of two large cites we are able to receive content from both cities which gave us a few more channels, most of them duplicates.  What we have found from watching the programming on the TiVo with the OTA signals is that the video is much clearer than the satellite picture we were used to.  This is because cable and satellite companies compress the signal and some of the data is lost during the transmission.  The difference in quality to me was amazing, and after months of use I still see the difference when viewing.

When it comes to cable channels and premium channels, the transition was not as easy.  There are a lot of apps available for streaming the channels, but not all of them offer DVR functionality.  Since we do not like watching live TV, this functionality was a necessity.  We had to do a lot of research to find an app that would supply the DVR functionality and the channels that we watch on a regular basis.  Luckily most apps offer a free trial and no long time contracts, so you can install them and test them before you make a decision.  Just like satellite and cable these apps offer different packages that allow you to customize which channels you receive.  So the price will vary based on your options.  One of the negatives, at least for me, that we have found is that most of the apps only stream certain channels at 60 frames per second (fps), the rest are streamed at 30 fps.  This is not an issue for most content except sports.  Some of the apps will stream just the sports channels in 60 fps.  So if you are watching a game on one of the channels, besides the sports channels, the signal will be 30 fps and the video appears to be very choppy.  This annoys the heck out of me but my wife says she cannot tell the difference.  There are some apps that stream all channels in 60 fps, but they either did not have the channels we needed or the DVR functionality did not exist.

All in all, we are happy that we made the switch.  We are still able to watch and record all of the content that we did with the satellite service and our monthly bill is more than half the cost.  If you need help researching an alternative to your service, feel free to contact SafeSourcing.   We can gather all the necessary information for you and help you decide which service meets your needs.

 

Shipping Lanes and the Fuel-In/Fuel-Out Debate!

Thursday, December 14th, 2017

 

Today’s post is our SafeSourcing Archives

Managing your freight/shipping lanes is a complex process.  There are so many factors that must be taken into account.  Even then, when you have gone through all of the analysis and created projection models and spreadsheets you are still left at the mercy of weather, sales increases and declines and, of course, any possible factor that could influence the price of oil.

Because this last item represents up to 35% of a carriers charge to you, it is one that many companies take very seriously and invest great amounts of time and money in order to help them control.  Some companies take the approach of locking a fuel rate into their cost for as long as they can to help protect against increases.  Many other companies have negotiated their base rates and keep the fluctuations of fuel separate, with controls placed around the formula used to calculate it. Today we will be looking at the pros and cons of both the Fuel-In and Fuel-Out methods.

Fuel-In – Fuel-In strategies are founded on having a final complete rate inclusive of fuel costs.  This is nice for companies who want a fuel cost method that is easy to manage, because the cost of each shipment for the negotiated period should always be the same.  Typically this method will either be re-negotiated at pre-fined intervals, or tied to an oil/fuel related index with language to cap how much the rate can increase or decrease.

While this strategy can be used to help protect a company during periods of time when fuel prices are rapidly increasing, it usually leads to higher overall rates for each negotiated period.  Without the flexibility to adjust with the average cost of fuel, vendors will generally error on the side that protects themselves and deliver higher than normal rates in their proposal.

Fuel-Out – Fuel-Out methods usually include a fuel surcharge that is based on some pre-defined fuel index such as the commonly used U.S. Department of Energy National Fuel Average price.  Using the agreed upon price, most formulas will subject a “trigger” amount which is the rate of fuel above which carriers begin to include the surcharge.  Typically this rate will be between $1.20 and $1.25 per gallon.  This amount is subtracted from the average fuel price and then divided by an agreed upon Miles Per Gallon rate (usually 5 or 6 MPG) which leaves the surcharge per mile charged.

Although this means that the price of shipments can fluctuate more often and that companies aren’t protected against a dramatic increase in fuel like the Fuel-In method, they will be able to take advantage of decreases in fuel that the method above doesn’t always allow.  The other advantage with this method is that it allows companies to get much more competitive base rates from carriers who know their fuel costs will be allowed to adjust the changing costs of fuel.

For more information about how we can assist with sourcing your freight lanes, please contact a SafeSourcing Customer Service Representative.

We look forward to your comments.

You can procure anything, including Candy Canes Part II!

Thursday, December 7th, 2017

 

Today’s post is from our  SafeSourcing Inc Archives.

What does it take to make a candy cane, package it, market it, and distribution? All of these involve procurement. Today, the candy cane makes up a significant amount of the $1.4 billion Christmas candy market. In fact, billions of candy canes are made and consumed each year.

What raw materials are included to make candy canes from madehow.com

Confectioners have steadily refined candy cane recipes and production methods. By incorporating new information about the characteristics of ingredients and food production processes, they have been able to make candy cane manufacturing an efficient process. The raw materials used to make candy canes are specifically chosen to produce the appropriate texture, taste, and appearance. Sweeteners are the primary ingredients, but recipes also call for water, processing ingredients, colorants, and flavorings.

Candy canes are primarily made up of sugar. When sugar (sucrose) is refined, it is typically provided as tiny grains or crystals. It is derived from beet and cane sugars. The sugar used in candy cane manufacture must be of high quality so that the proper texture and structure will be achieved. It is the unique physical and chemical characteristics of sugar that makes formation possible. When sugar is heated, it melts and becomes a workable syrup. The syrup can be manipulated, rolled, and fashioned. As it cools, the syrup becomes thicker and begins to hold its shape. When the candy is completely cooled, the sugar crystals remain together and form the solid candy cane.

Corn syrup is also used to produce candy canes. It is a modified form of starch, and like sugar it provides a sweet flavor. When it is mixed with the sugar, it inhibits the natural tendency of sugar to crystallize. Crystallization would result in a grainy appearance and a brittle structure. Corn syrup has the added effect of making the sugar concoction more opaque. Without the corn syrup and other ingredients, the candy would be transparent. The corn syrup also helps to control moisture retention and limits microbial spoilage. Beyond sugar and corn syrup, other sweeteners are sometimes incorporated into the candy cane recipe. These may include glucose syrups, molasses, or other crude sugars. Some low calorie candy cane recipes may incorporate artificial sweeteners like aspartame.

Certain ingredients are put in the candy cane recipe to aid in production. To dilute the sugar and make it workable, water is used. During the manufacturing process the water is steadily boiled off, and the end product has much less water than what it started with. Another processing ingredient is cream of tartar. This compound has the effect of producing air bubbles that help expand the sugar loaf and make it more stable. Salt also helps to adjust the chemical characteristics of the syrup. Typically, a small amount is used so that it is undetectable in the final product.

A variety of other ingredients may be incorporated into a candy cane recipe to produce various effects. To give the candy flavor and color, wintergreen or peppermint oils are added. Other natural flavors obtained from fruits, berries, honey, molasses, and maple sugar have also been used in candy cane production. Artificial flavors have also been added to improve taste. Additionally, fruit acids like citric acid and lactic acid can be added to provide flavor. Artificial colors such as certified Federal Food, Drug, and Cosmetic Act (FD&C) colorants are used to modify the color of the final product. In the United States, the federal government regulates these colors and qualifies each batch of colorant produced by the dye manufacturers. This ensures that no carcinogenic compounds are added to food products.

Sugar is a commodity that has a price index that fluctuates with the market increases and decreases. As of December 6, 2013 the market is down -0.10 bring the price per pound to $16.59 per the Sugar, Free Market, Coffee Sugar and Cocoa Exchange (CSCE) contract no.11 nearest future position, US cents per Pound.

Manufactures of candy canes can source their sugar directly from manufactures or wholesalers. This can create extra spend or savings depending on which source you purchase from. Typically through distributors and wholesale companies, there is additional shipping, handlings, and middle man fees included in the purchase price.

Whether you have been purchasing from the same source for years or you are just starting your business, running a Request for Proposal will help you understand who the companies are, where they source their sugar, what their pricing structure is, what price index they use (this will help you determine historically any increases or decreases), and any additional fees they may include.

SafeSourcing, Inc. can help you source your goods, create and run a Request for Proposal and compress the suppliers pricing by running a Request for Quote. 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.

Tomorrow we will discuss how to make candy canes and package them and how SafeSourcing can help in these areas.

Are Your Vehicles Winter Ready?

Friday, December 1st, 2017

 

Today’s post is by Troy Lowe; Vice President of Development at SafeSourcing.

Winter is quickly approaching and it is time to start getting your vehicles ready for the harsh weather.  One thing that always seems to get me every year is lack of windshield washer fluid.  You’ll be driving along on snowy day and the salt and water from the road splash up.  You turn on the wipers only to realize it smears on the windshield causing next to zero visibility.  Washer fluid is definitely needed to remove this kind of grime.  Make sure to keep an extra container available in the vehicle.  When purchasing windshield washer fluid, make sure to get an all-season washer fluid so that it does not freeze during the frigid temperatures.  While you’re at it, go ahead and check the washer blades for wear and tear and replace as needed.

If your battery is a few years old, it would be a good idea to have it tested.  Colder weather is much harsher on a battery and a weak battery can become a dead battery very quickly.  Take a look at the terminals and remove any corrosion to ensure a good connection.

If you have not had the coolant changed according to the manual recommendations, you may want to consider a flush and fill.  If the maintenance is up to date, you should still check for leaks, check the coolant level, and top it off if needed.  This is very crucial because the coolant, also called antifreeze, keeps the engine from freezing during the cold temperatures. Another important item to check is the tires.  Worn tires are very dangerous during the winter months.  Make sure that the tread is fine and that there is no uneven wear.  Check the tire pressure and make sure that it is set to the manufactures’ recommended pressure.  This is important and should be done about once a month.  While you’re doing this, do not forget to inspect the spare tire as well.

You may also want to consider keeping a survival kit within the vehicle in case of breakdowns.  This should consist of items such as blankets, flares, gloves, flashlight, first aid kit, jumper cables and cell phone charger. Driving in the winter is much more dangerous. To keep things safe, you may also want to inspect these other things as well:

  • Brakes
  • Lights
  • Oil
  • Filters
  • Heater and Defroster

If you need help finding a licensed maintenance company to maintain your vehicles, feel free to contact SafeSourcing.   We can gather all the necessary information for you and help you decide which company meets your needs.  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.

 

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

 

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.