Retailers are your fuel purchases pennies wise? Some fuel for thought.

May 23rd, 2008

With gas prices approaching $4.00 per gallon (and that?s economy fuel) it may be time to figure out how to save pennies that you might not have focused on historically in order to continue working with your legacy fuel suppliers.

With gas prices approaching $4.00 per gallon (and that?s economy fuel) it may be time to figure out how to save pennies that you might not have focused on historically in order to continue working with your legacy fuel suppliers. Are you aware of other sources of supply? Is it possible to save a few pennies per gallon by making your suppliers compete for your business?

When the price of oil goes up, and today crude futures retreated slightly after topping 135 U.S. dollars a barrel for the first time; we hear mostly about the price of our gas at the pump. In the U.S. we don?t expect to pay this much for that precious commodity we all need in order to get to work, drive the kids to all of their activities, buy groceries, go to the doctor, and when time permits enjoy our leisure activities. What we don?t hear a lot about is the price of all the related fuel products like diesel, kerosene or jet fuel. The truth is they are all going up.

In our SafeSourceIt? North American supplier database there are 3,292 U.S. suppliers in the major category fuel. This data can be further filtered into sub categories such as kerosene, diesel etc. Data can then filtered by region, zip code and a variety of other classifications. The same data is available for Canada and Mexico.

With the availability of this type of data, retailers may be able to reduce or hold their fuel prices. In most cases fuel either directly or indirectly represents one of many retailers top spend categories. Watching rack rates daily and having new sources of supply that are also trying to survive compete for your business provides a formula for saving pennies and takes the emotion out of the decision making process. In the food industry where net profit regularly runs at 1% or less pennies add up.

I know I?d go to a pump that was priced at $3.99 per gallon instead of one next to it priced at $4.00.

I look forward to your comments

Ron

How do Retailers and Suppliers go Green?

May 22nd, 2008

Today?s retailers have so many initiatives on their plates that trying to focus on what at first does not seem to be their most important initiative (Going Green) can create a type of corporate gridlock that stops the organization from moving forward in a timely manner.

Today?s retailers have so many initiatives on their plates that trying to focus on what at first does not seem to be their most important initiative (Going Green) can create a type of corporate gridlock that stops the organization from moving forward in a timely manner. The key is to not bite off more than you can chew and to set realistic goals and timeframes. There are so many external organizations trying to share their green initiatives today and set their own company standards so high that they hope to become the standard for everyone. As a result, volumes of data exist that would drive many organization crazy just trying to sort thorough it in order to come up with their own companies guideline.

So, where should a company begin? First of all, companies need to set guidelines for their company. In order to set guidelines, companies need to realize going in that guidelines are intended to be ‘living documents’, and will be updated on a regular basis going forward. In other words, by their nature they are not complete. Since we are talking about the environment, let?s make sure we don?t go down the path of health, safety and other areas even though they are related. Crossover with these areas will occur naturally as you focus on your guidelines for those specific areas later. Today we are here to talk about the environment. So what do we focus on? A starting point for the environment will always include the following. As you try to break this format down further, you will find that almost all areas fit into the following categories. As an example, contaminated land would fall into land management.

Energy Conservation
Water Conservation
Hazardous Materials Handling
Waste Management
Noise Pollution
Land Management
Wastewater Management

An important piecet of any corporate policy once outlined is to make sure that you share your guidelines with your trading partners and hold them accountable to doing the same thing in order to earn their business with you.

Once you begin to focus on tgoing green, it?s amazing how you will transfer it to your personal life. I know it?s personal for me.

I look forward to your comments.

Ron

Suppliers are you Green Enough? Do consumers really care?

May 21st, 2008

Do you ever wonder why the entire hubbub when we talk about the environment or the ecology? What does it really mean when we ask companies are you green enough?

Do you ever wonder why the entire hubbub when we talk about the environment or the ecology? What does it really mean when we ask companies are you green enough? Or, are you doing all you can to protect the environment. Do we even really care? What does it really mean?

Well, apparently we do care and companies that want to prosper should pay attention to the groundswell of consumers that are willing to pay more to get more in the way of safer products from companies that go beyond product safety to also manufacture in a way the protects the environment for our children and their children after we are gone.

A Wells Fargo/Gallop phone survey in 2007 of 600 small business owners surveyed on the environment asked the following questions.

  1. Should additional standards on carbon dioxide, greenhouse gases be implemented? Forty three percent of respondents rated that a priority. Thirty seven percent rated it a top priority and nineteen percent said it was not a priority
  2. On the question do you favor or oppose setting higher emissions and pollution standards for business and industry, seventy five percent favored it while twenty five percent opposed it.
  3. When asked if they would be willing to pay more for good, and services if you new they were environmentally friendly, sixty six percent said yes and thirty percent said no.

During this political season any politician that received eighty percent, seventy five percent or sixty six percent of any vote would consider it a landslide and an affirmation of their political agenda.

In a closer vote, an Allianz Global investor survey of over one thousand adults of whom only seventeen percent had invested in a particular mutual fund because it was developing technologies or approaches to address environmental problems. When asked the question would you invest in such companies or mutual funds in the next year, forty nine percent said yes.

So, suppliers? are you green enough. Your constituents are watching and voting with their dollars. If you?re not you should look for ways to get there quicker and take advantage of tools that can help you do it.

I know I look more closely now at what my personal carbon footprint is and the impact it has on future generations,

I look forward to your comments.

Ron

When Ecology and Safety Collide!

May 20th, 2008

I read two short but interesting articles lately. They indicated how not being ecologically sound in one area can have a potentially long term negative impact on safety in the food chain. One article was titled ?Study finds lead in game meat?. The other was titled ?Fla. warns of mercury levels in frog legs?.

I read two short but interesting articles lately. They indicated how not being ecologically sound in one area can have a potentially long term negative impact on safety in the food chain. One article was titled ?Study finds lead in game meat?. The other was titled ?Fla. warns of mercury levels in frog legs?. Now I must admit that I do not hunt, nor do I consume venison or frog legs. I have had venison before and I have eaten bison. I just don?t eat them on a regular basis.
So, where is the safety connection? Well, just as we have alternative energy sources, hunters have alternative ammunition choices. As in most green focused issues it does come down to the price. In the case of game meat, hunters have the choice of using non lead bullets or shot. Retailers also have the choice of selling non lead bullets or shot.
A study released last week by the Peregrine Fund and Washington State University shows that people who ingest game animals killed with lead bullets risk ingestion of poisonous metal. Even amounts formerly considered safe have a variety of health related issues associated with them.
Now, what about those frog legs? How did they get such high levels of Mercury?
Mercury gets into the air as a byproduct of industrial activities such as chlorine production, power generation from coal, garbage incineration, and some manufacturing processes. The airborne mercury from these activities is deposited on land and water, where microorganisms convert it into a more biologically active form, methyl mercury.
When humans or other animals consume the fish, we get the mercury that’s now in the fish. Short-term exposure to high concentrations of mercury vapor has harmful effects on the nervous system, digestive system, respiratory system, and kidneys. Long-term exposure to mercury can permanently damage the brain and kidneys at any age.
In the Florida article, health officials suggested that people eating a particular type of frog legs (pig frogs) should limit their consumption to one eight ounce serving per month.
What can retailers do? For one thing we can insure that our sources of supply for wild game and fish if we carry them certify that they are free of lead and mercury. We can ask our suppliers to insure that the processing plants they use are doing what is necessary to help in the reduction of mercury by supporting programs such as the Clear Skies Initiative.
I?ll probably eat game animals again at some point, but I?ll think more about it when I do.
I look forward to your comments.

Twenty steps to running high quality e-procurement events.

May 19th, 2008

E-Procurement events have been around since the late 1990?s and are commonly referred to as reverse auctions or events. These sessions can from time to time also run as forward auctions in order to reduce over stock conditions and reduce shrink. .
Regardless of the naming convention used there are certain rules which if followed will create higher quality events for?both?the retailer and the supplier? This will result in creating better savings opportunities or cost avoidance in? tough markets. The importance of focusing on a clear process will increase event participation. This focus on quality will be recognized by your existing trading partners and potential new sources of supply, and will keep them coming back in the future to compete fairly for your business.
Below are twenty?steps that are mandatory if you wish to have success with e-notitation events and specifically? reverse auctions.??
  1. Executive sponsorship is mandatory.This is required at the CEO, CFO, CPO, CLO or head of the supply chain.
  2. Get the entire buying organization together for a kickoff session.
  3. Provide an over view of what you are going to do and the impact it can have on the company. Use company financial models.
  4. Discuss and agree on success criteria.
  5. Every event is not a homerun. Singles and doubles score runs.
  6. Create a fun environment.
  7. Consider prizes for the most creative use of an auction.
  8. Use scorecards by department with percent of savings.
  9. Discuss the meaning and importance of corporate aggregation.
  10. Hand out event templates to gather existing product specifications.
  11. Put a time requirement on data collection.
  12. Gather an accurate list of your present suppliers.
  13. Work with your sourcing company to identify a top 100 list of events.
  14. Calendar the events.
  15. Prioritize by dollar value, date and strategic value.
  16. Conduct department level discovery meetings of 30 minutes to an hour.
  17. Investigate existing contract language.
  18. Look for auto renewal (evergreen) language roadblocks.
  19. Determine alternate sources of supply with your sourcing company.
  20. Develop an event rules and instruction template and post with each event.
Although these steps are not all encompassing, they provide a format for getting started that offers the best opportunity for reduction in cost of goods, expenses and improvement in corporate earnings. Be sure to combine this with a business partner that knows your business.
We ?look forward to and appreciate?your comments.

Let’s support our Retail Partners

May 16th, 2008

In the ARIZONA REPUBLIC today in a small corner of the business section there was a blurb in the Nation & World section titled Product Safety. The sub title of the four paragraph article was Toy sellers say suppliers will meet U.S. standards.
In the ARIZONA REPUBLIC today in a small corner of the business section there was a blurb in the Nation & World section titled Product Safety. The sub title of the four paragraph article was Toy sellers say suppliers will meet U.S. standards.
The good news is that retail leaders such as Wal-Mart, Target and Toys “R” Us are behind actions taken by the House and Senate to overhaul the Consumer Product Safety Commission. These actions will require suppliers to meet new standards that limit the amount of lead and other metals in toys and children’s products. I’m not sure if I like the term limit, but any step forward is better than continuing to do the same old thing.
Companies that provide software and applications that are part of automating the procurement process, also need to step up and make sure that their tools support these changes to the greatest extent possible and provide knowledge ware that interacts with both regulatory agencies and suppliers to insure product safety as more new sources of supply and new products enter the supply chain on a daily basis.
Action that software suppliers can take may include but are not limited to:
  1. Providing alert data on a daily basis as to product recalls and safety warnings.
  2. Trace warnings back to the original source of supply automatically.
  3. Require that suppliers meet required safety certifications to participate in their database.
  4. Provide a regular purge of suppliers that do not comply.
  5. Adhere to a strict RFI process for new suppliers being added to databases.
  6. Rate suppliers that are offered to retailers as new sources of supply.
  7. Monitor regulatory agencies for new standards and include them in the database.
This is only a start, but in order to insure the safety of our families it is our social responsibility as business partners to support our retailers efforts.
I’m sure glad we don’t have to worry about lead in pencils any more.
Ron

Let?s support our Retail Partners

May 16th, 2008

In the ARIZONA REPUBLIC today in a small corner of the business section there was a blurb in the Nation & World section titled Product Safety. The sub title of the four paragraph article was Toy sellers say suppliers will meet U.S. standards.
In the ARIZONA REPUBLIC today in a small corner of the business section there was a blurb in the Nation & World section titled Product Safety. The sub title of the four paragraph article was Toy sellers say suppliers will meet U.S. standards.
The good news is that retail leaders such as Wal-Mart, Target and Toys ?R? Us are behind actions taken by the House and Senate to overhaul the Consumer Product Safety Commission. These actions will require suppliers to meet new standards that limit the amount of lead and other metals in toys and children?s products. I?m not sure if I like the term limit, but any step forward is better than continuing to do the same old thing.
Companies that provide software and applications that are part of automating the procurement process, also need to step up and make sure that their tools support these changes to the greatest extent possible and provide knowledge ware that interacts with both regulatory agencies and suppliers to insure product safety as more new sources of supply and new products enter the supply chain on a daily basis.
Action that software suppliers can take may include but are not limited to:
  1. Providing alert data on a daily basis as to product recalls and safety warnings.
  2. Trace warnings back to the original source of supply automatically.
  3. Require that suppliers meet required safety certifications to participate in their database.
  4. Provide a regular purge of suppliers that do not comply.
  5. Adhere to a strict RFI process for new suppliers being added to databases.
  6. Rate suppliers that are offered to retailers as new sources of supply.
  7. Monitor regulatory agencies for new standards and include them in the database.
This is only a start, but in order to insure the safety of our families it is our social responsibility as business partners to support our retailers efforts.
I?m sure glad we don?t have to worry about lead in pencils any more.
Ron

How Safe are the Drugs We Use?

May 15th, 2008

I went to my local pharmacy today to pick up my monthly prescription. I must admit

I went to my local pharmacy today to pick up my monthly prescription. I must admit, that I continue to refuse to use the generic equivalent. I shop at one of the national chains, primarily because it is close to home. Quite frankly their service is impeccable and the pharmacists in the store treat you like it was their own business.
Today I had a discussion with my favorite pharmacist as to why I did no want to switch to the generic version and save some money. We talked a little bit about the Wal-Mart generic program that started out as $4 generic drug prescriptions and has now evolved into a 90 day supply of your generic drug for $10. We discussed how in these times, those are big savings for financially strapped consumers. My position was that the recent heparin tragedy scared me to death and that I did not feel as though the necessary precautions were in place in the supply chain particularly from low cost suppliers to make me want to trust generics. Particularly for drugs that have been around for a while.
With that said, we know that over 50% of Americans with health insurance plans take regular medication for a variety of ailments. We also know that by October the FDA will have added over 1300 new employees as a result of the food and drug issues we have suffered recently that have impacted everything from toys to dog food. Nearly a third of these positions will be focused on drug review. Are you feeling any safer? I?m not! Independent drug stores have to look for other sources of supply in order to compete with the Wal-Marts of the world. So what can they do to protect us?
The following are some red flags for all retailers to be aware of or look for. There are also industry tools that can automate a lot of this process including sophisticated databases and RFI tools. Although this is not a complete list it is a suggested starting point.
  1. The supplier can not divulge the original source of their product.
  2. Products offered do not meet FDA dosage approvals or your specifications.
  3. Supplier?s price book offers generic products that are not approved for use in the USA.
  4. The brand name or product names are not spelled correctly
  5. Payment terms requested are unusual.
  6. Ask to see the wholesale license for the state you are located in.
  7. Suppliers contact information is from outside of the USA.
  8. Product samples look tampered with or are of poor quality in either packaging or printing.
In the meantime, I will continue to use the branded products with FDA approval. I?ll sleep better at night and wake up to fight another day.
Ron

How safe are we?

May 14th, 2008

I was listening to the news last night and looked up from my PC when I heard that the water in my zip code is not as safe as it should be and that my reverse osmosis system has no impact on the chemical makeup I can?t even pronounce. What a way to go to bed.
I was listening to the news last night and looked up from my PC when I heard that the water in my zip code is not as safe as it should be and that my reverse osmosis system has no impact on the chemical makeup I can?t even pronounce. What a way to go to bed.
When I got up this morning, I grabbed my USA TODAY and the lead article in the sports section was Artificial turf: Health Hazard? Most baby boomers like me remember when these fields started to appear in the late 1960?s. Many of those fields are still in use today. The article also indicates that as many as 900-1000 new artificial fields are being installed every year.
I remember when they opened the Astrodome, and how quickly Astroturf became the next cool thing to have installed at your school. Now similar materials are in our parks and even in some of our neighbor?s yards. Well, it now it appears as though many of the thousands of fields in the USA may pose health hazards to anyone that uses them. The U.S Consumer Product Protection Safety Commission and the U.S. Environmental Protection Agency are investigating.
According to an EPA spokesperson there are precautions you can take when playing on artificial turf.
  1. Wash your hands face and body after playing.
  2. Take off clothes worn, turn inside out and wash separately.
  3. Field custodians should water the fields before and after use to reduce dust.
You might ask what this has to do with safety in retail procurement. The answer is almost everything. As citizens we need to hold our schools, townships, HOA?s, municipalities, churches and other organizations accountable to make sure that they do everything in their power to insure the products we use are as safe as possible. If as consumers we are going to hold retailers accountable and in turn ask them to hold their suppliers accountable; we need to practice what we preach in our private lives. It?s a way of paying it forward and thinking about what impact choices we make today have on our family and friends and the community at large in fifty years. At a minimum you can do the following.
  1. Ask where products these organizations buy come from.
  2. Ask what components go into making these products
  3. Ask what consumer safety standards were followed in the manufacture of these products.
In the meantime when I take my dog for his walk in the morning I?m going to keep him off the artificial turf at our park and then let him have bottled water when we get home.
Ron

Thinking Green

May 13th, 2008

I was reading an Aberdeen report recently titled Building a Green Supply Chain . The report quoted and age old reality. ?You can?t improve what you don?t measure?.

I was reading an Aberdeen report recently titled Building a Green Supply Chain. The report quoted and age old reality. ?You can?t improve what you don?t measure?. This applies to green and safety standard compliance. Importantly, companies also can?t expect their trading partners to know what they are not told.. In a recent white paper titled ?Safety in the Supply Chain, an Irony? I listed nine steps to safer and a more eco-friendly procurement. Although simple, these simple steps go a long way towards accomplishing the most important step in any endeavor. If you don?t write it down, it won?t happen. As a guideline I offer the following:
Nine steps to safer and more eco-friendly procurement
1. Be pro-active in driving not for resale and for resale product safety within your company, and also supporting eco-standards in the procurement process.
2. Pay it forward with all of your trading partners by sharing what you are doing, and asking what they do to support yours or similar initiatives of their own.
3. Educate your employees and trading partners about common safety standards and guidelines such as the SQF Certificate www.sqfi.com and the Global Food Safety Initiative www.ciesnet.com.
4. Educate your employees and trading partners about common eco-standards such asGreen- Energy National Standard www.green-e.org or EcoLogo www.ecologo.org.
5. Point associates and trading partners to free educational websites such as www.safesourcing.com to use their free SafeSourcing Wiki or the Sourcebook professional social network for procurement professionals.
6. Only use trading partners that follow your lead.
7. Train your team to understand and use all available tools that insure supply chain safety such the free daily safety in sourcing blog at www.safesourcing.com or the low cost SafeSourceIt Supplier Database and Reverse Auction Tools.
8. Write it down and then impose a system of measures and controls to monitor performance against clearly defined goals.
9. Start at the top and engage all levels of your company.