spendmatters
 

February 09, 2012

 

November/December Imports Decline: Anomaly or Concern?

Panjiva recently released its latest trade numbers covering November 11-December 11 2011. While Panjiva notes "the number of waterborne shipments coming into the U.S. experienced a 7% month-over-month decrease from November to December," the more insightful overall metrics are the wide-ranging percentages and overall volatility for the same period in recent years (which Panjiva sites in their above-linked post). In other words, this is a time period accustomed to year-over-year swings and fluctuations.

The number of global manufacturers that shipped goods to the US in the period also declined modestly, falling 4%, Panjiva indicates (compared with a 9% decline in 2010 and a 3% increase in 2009). However, the number of at-risk "significant" manufacturers does not appear to be increasing based on Panjiva's metrics, holding firm at 20% on what Panjiva describes as Watch List vendors (i.e., "Manufacturers that have suffered a 50% or greater decline in volume shipped to American customers in the most recent three month period, versus the same period a year ago").

There are many ways to use Panjiva data for analytics, including factoring in their Watch List suppliers as one potential indicator of rising risk in a supply base (especially in cases where credit and/or supplier risk scoring is not available or incomplete from traditional ratings authorities). But perhaps most interesting -- or at least enjoyable -- for us, is looking at Panjiva data not just to monitor trends among supplier shipments in absolute terms, but also to see which suppliers are shipping to which customers. It's not perfect -- companies on both sides of the buying/selling equation can hide between different trading company fronts -- but what Panjiva has done to surface supply risk and trade intelligence from US Customs and related import data remains as relevant and cool as ever.

- Jason Busch


Commodity Edge Conference

No Half-Steppin’ Here -- FullStep Tackles Manufacturing-Centric Procurement in Spain/Beyond (Part 2)

Please click here for the first post in this series.

In continuing our analysis of FullStep from late last year, we'll turn our attention to exploring how this Spain-based spend management suite vendor (currently expanding into North, Central and South America) has tailored its set of solutions for a manufacturing environment, including the middle market, where a general lack of technology, resources and cross-facility collaboration often hinders the potential for direct materials sourcing and vendor management savings programs. To review FulllStep's general breadth and capabilities, be sure to keep these items in mind:

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Prepping for Your Next IBM Contract

Spend Matters welcomes another guest post from NPI, a spend management consultancy, focused on delivering savings in the areas of IT, telecom, transportation and energy.

IBM takes a lot of heat. Their diverse offerings and growth-by-acquisition business strategy means they have a staggering amount of competition in the marketplace. It also means they know when to be aggressive. Here are a few things to consider as you purchase or renew your IBM solutions:

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Spend Matters Afternoon Coffee

Pucker up!
Is that Lead in Your Lipstick? FDA Tests Reveal Raised Lead Levels in U.S. Lipsticks -- In 2007, largely in response to a report released by the Campaign for Safe Cosmetics, the FDA began testing various lipsticks sold in the United States. After testing some 400 brands, FDA scientists concluded that none of them contained unsafe levels of lead. Many of them did contain lead, but all were below the 5 parts-per-million recommended as safe by the state of California (known to have the most conservative law on the use of lead in consumer products), and far below the 10ppm considered to be the maximum safe limit by Health Canada, which has drafted guidelines on impurities in cosmetics, such as lead. At the time, those weighing in with the most lead contained about 3 parts per million. The FDA said there was no cause for consumer concern, especially given how little lipstick is actually ingested.

Oh good.
Airbus to inspect all A380 superjumbos for wing cracks -- Aircraft maker Airbus has been ordered to check all A380 superjumbo planes currently in service after cracks were found in wing components. The European Aviation Safety Agency (EASA) has ordered all 68 Airbus A380 superjumbo planes currently in operation to be checked. It extends an earlier check of 20 A380 jets, whose wings are made in North Wales, ordered by the EASA last month.

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Apple, Social Responsibility and Procurement: More CSR Pesticides or Going Organic? (Part 5)

Click here to read previous posts in this series: Part 1, Part 2, Part 3, Part 4.

Worker safety has definitely captured the negative headlines for Apple the most in the past twenty-four months. But their code of conduct in the area of environmental impact might just be more important for those in the broader procurement and supply chain professionals. After all, Apple's actions (or lack thereof) around worker safety are tacitly one-upping local labor practices and expectations (safety nets for potential jumpers don't exactly address problems at the source).

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Supply Chain Insurance: Act Fast (If You Can Get It)

Here at Spend Matters, we've heard stories from numerous insurers and agents involved in the underwriting process for supply chain risk policies that getting coverage is becoming a more expensive value proposition -- and that's when an organization can get coverage at all (e.g., for a named supplier, supply, facility). The recent crises and disruptions throughout Asia -- from restricting the flow of the supply of rare earth metals to Japan last year -- have combined to make such products more costly, when insurers are even willing to consider offering them in certain high-risk markets like Japan, China and Vietnam. A recent article from Business Insurance provides some context and research to back up the anecdotal challenges we've been hearing about.

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Spend Matters Vendor Snapshot: CombineNet

To keep our readers (and ourselves) up to speed on technology developments, we field numerous briefings and product demonstrations at Spend Matters. This new Vendor Snapshot format provides a succinct look at the technology reviewed -- with a side order of quick, honest analysis. This lighter format aims to complement our regular, deeper analysis based on both in-depth solution testing and actual customer interviews. Your feedback on our new format would be appreciated.

Company Overview
CombineNet has long been the gold standard for advanced e-sourcing with a focus on heavy lifting in the bid analysis area -- the term 'optimization' has nearly becoming synonymous with the company.

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“That Time of the Month”

Spend Matters welcomes a guest post from Mark Schaffner, VP of Marketing at Verian.

It's an uncomfortable topic.

There are some people who become irritable, demanding, and yes --somewhat emotional, for about a week at the same time every month. Their physical demeanor changes, they look tired, break out, and sometimes crave chocolate or chips more than usual.

They are accountants.

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Spend Matters Afternoon Coffee

Join Jason and Hubwoo for a webinar next week.
How to Better Leverage Your ERP Investment with a Supplier Network -- Hear insights from Jason Busch on how organizations today use third-party supplier networks to optimize their ERP procurement technology. Learn how CONSOL Energy drove $44M in cost savings leveraging an ERP-integrated supplier network to bring two company consolidations under its fold quickly and seamlessly while reallocating headcount.

Chocolate CSR.
How Big Chocolate plans to save its cocoa supply -- A Hershey's Kiss is more complicated than it looks. Most of the cocoa in it and other chocolate candies comes from West Africa, and it makes its way through a long supply chain to get to U.S. factories. Now more than ever, Fortune 500 companies such as Hershey (HSY) have to take responsibility for every link in that chain. On January 30, Hershey announced plans to put $10 million towards solving child labor problems on West African cocoa farms by 2017. The money should also help farmers access educational programs and improve their cocoa yield.

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Apple, Social Responsibility and Procurement: More CSR Pesticides or Going Organic? (Part 4)

Click here to read previous posts in this series: Part 1, Part 2, Part 3.

Apple has spent some time in the negative spotlight around the actions (or lack of actions) of its suppliers in the area of worker health and safety. Even recent coverage, such as the NYT story that describes in gory detail the results of an explosion at a Foxconn facility that tore apart the face of a college-educated technician working on equipment used in the manufacturing of iPads and iPhones, points to continued negativity in the mainstream press toward Apple's practices around health and worker safety. But is this negativity justified? We believe it likely is, if you adopt the perspective that Apple must adhere to global health and safety standards on the shop floor rather than Chinese ones (or lack of ones, for that matter).

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