All Posts Tagged "transportation"...
Did you get all the chicken wings you wanted to accompany your Super Bowl experience? Thank the NHL. Did they cost more than last year? Blame ethanol. Several weeks ago, the National Chicken Council issued a warning that production was down this year due primarily to rising feed prices. Rumors of a chicken wing shortage spread like wildfire.
Several years ago, it was almost fashionable to outsource to low-wage areas of the world to reduce costs. Business leaders developed the mind-set of “off shoring is always cheaper:’ and they scarcely looked beyond unit cost plus transportation.
Market Analysis & Communications for the Manufacturing Industry
The supply chain disruptions that are evolving from the earthquake and tsunami in Japan should be a wake-up call to all of us in the resource management field. Today’s lean supply chains are unquestionably more efficient and more effective than the old, traditional ways of doing business, but they are fragile. We no longer have the abundance of inventory in the pipeline and in the stockroom that might have allowed us to keep operating, for a time at least, when a supply or a transportation link fails.
When a company needs parts and materials, a purchasing or sourcing function will find an appropriate source, negotiate cost and terms, and administer the transactions to complete the procurement. In recent years, a lot of that purchasing activity has gone
A volcano in Iceland erupts and shuts down air travel to and from parts of Europe. Chinese workers strike for higher wages. A supplier’s plant has a devastating fire. Increased security procedures cause delays in getting import shipments cleared through the port. Commodity prices soar – then tumble. Petroleum prices triple, increasing all transportation costs.
With the evolution of tighter supply chains, shorter product cycles and shorter lead times, along with dramatic reductions in inventory throughout the supply chain, one might be tempted to conclude that planning and forecasting are a lot less important today than they were in the pre-Internet world. Don’t you believe it!
Sometimes, it’s helpful to step back and ask the ‘big question’: Why do we have xxx? Or why do we do yyy? It’s easy to get wrapped up in the details and lose sight of the overall objective. Let’s look at a couple of answers.
A big part of the “green” movement in manufacturing is the idea of sustainability meaning “using methods, systems and materials that won’t deplete resources or harm natural cycles.” This is a particular subset of the general idea of waste reduction that is focused on the use of renewable resources and the whole realm of reuse, recycle, and responsible disposal.
Many ‘green’ efforts are also sustainability efforts. When you reduce energy requirements, you are reducing the use of fossil fuels and lowering emissions. When you eliminate or reduce packaging that contributes to sustainability as well. Using materials from renewable sources (soy-based instead of petrochemical, for example), is a very sustainability oriented action. Most of these changes also save money, many immediately and others over the long term.