All posts by Procurious HQ

Supply Chain Disruption and Risk Mitigation in Tianjin Explosion

Two enormous explosions ripped through the Chinese port city of Tianjin last week, killing 112 people, hospitalising hundreds and leaving thousands of local residents homeless.

Explosion in Tianjin, China. Reuters

 

While nothing can be compared to the tragic loss of human life, businesses look set to have to deal with major disruptions to their supply chains, with logistics issues for some and significant loss of goods that were at the port when the explosions occurred.

Safety Fears

The blasts, which occurred in a warehouse storing hazardous chemicals, were large enough to be seen from space and also register as seismic activity in Beijing (over 75 miles away). Investigations have been started as to the cause of the explosions, but are being hampered by safety concerns at the site.

Residents in a 3km radius were evacuated on Saturday after it was found that sodium cyanide was present at the site. The volatile powder can be fatal if inhaled and, when mixed with water or burned, produced hydrogen cyanide, a highly poisonous gas.

Business Impact

The current situation, as well as the inability to get people on the ground at the port, has made it difficult for businesses to quantify the losses they have suffered. Tianjin is the world’s 10th busiest port and China’s largest hub for the import of vehicles, which means organisations will be dealing with the future impact as well until the port returns to full capacity.

Mitsubishi have estimated a total of 600 cars were damaged in the blasts, while Renault and VW have also stated that they have lost cars that were being stored in warehouses at the port. Toyota has suspended production at two of its Chinese facilities for three days due to logistics issues caused by disruption to port services.

And it’s not just auto-manufacturers that are affected. The port also handles large quantities of metal ore, coal and steel, with Australian mining giant Rio Tinto stating that shipments had been disrupted, although no products had been damaged.

A number of Chinese technology organisations have also reported interruption to operations. Tencent, Liepin and 58.com were among the companies with facilities within the blast radius and are returning operations to normal wherever possible.

Analysts estimate that the incident could generate total insurance losses of between $1-1.5 billion.

Risk Mitigation

While situations as extreme as this are fairly uncommon, disruptions in the supply chain are something that organisations need to deal with on a regular basis. Around China, shippers and maritime logistics organisations have begun to route freight through other ports, while others have begun to look at using airfreight.

Having good contingency plans in place for your supply chain allow you to cope with the unexpected risks and outcomes. Scenario planning can be used to reduce uncertainty and mitigate risks. You can get some good tips for that here.

From identifying alternatives methods of transportation to creating supplier panels to ensure continuity of supply for critical items and engaging openly with stakeholders, there are a number of options open to organisations to allow them to adequately deal with disruptions in the supply chain.

You can keep track of potential risks through a variety of tools, including the BSI Risk Index and the CIPS Risk Index. These organisations will publish research based on the indices that can help to shape organisational strategies for the mitigation and management of risk.

You can also always check out the eLearning available on Procurious for a selection of free videos on risk and crisis management, which should help you build a foundation in the understanding of the topic.

Is your organisation impacted by the situation in China? Do you have any great risk mitigation tips you can share with your peers? Let us know or get involved on the Procurious community.

If you haven’t had time to check out the big stories in the procurement and supply chain space this week, here are some of the main headlines.

Calais crisis: freight costs could rise ‘significantly’ 

  • Unless the ongoing crisis at Calais is resolved, freight prices could rise significantly in the next few weeks according to Rhenus Logistics UK. The company said the operational impact that French strikers and migrant incursions at the port were having on the UK’s import and export trade was concerning.
  • Managing director David Williams said drivers were resigning from the route due to the stress of getting through the port, and the risk of fines because of stowaways. “The decision by drivers to step away from this route has already seen a number of freight businesses introducing surcharges of between 1-2 per cent,” he said. “The rise in costs, due to increased fuel bills, man hours and required rest break, is now becoming a very serious issue for the logistics industry.”
  • Separately, global supply chain consultancy Crimson & Co warned that the continuing disruption at Calais highlighted the need for UK businesses to review their risk strategies. The firm said exporters and importers across the UK were reporting losses and were being forced to either find alternative but more expensive routes or stop deliveries altogether.

Read more at Supply Management

Apple confirmed to be working on self-driving car

  • Apple is working on a self-driving car project, and may have made more progress on the car than previously thought, according to documents seen by the Guardian. The UK newspaper said it has seen correspondence between Apple and a high-security test site near San Francisco, regarding a test location.
  • Apple is rumoured to be working on a self-driving car, apparently under the code name ‘Project Titan’ and has held meetings with automotive manufacturers and recruited engineers in this field, but the test site communication is the first confirmation of the project.
  • The Special Project group at Apple had contacted the test centre, GoMentum Station, a former weapons testing facility. It has over 20 miles of paved roads and streets for testing, and is still guarded by the military, offering a high degree of privacy and security.
  • Tim Cook, CEO of Apple has reportedly met with executives from a number of car companies recently, including Fiat-Chrysler, and it has also hired engineers from Tesla Motors, Mercedes-Benz, and electric car battery maker A123 Systems.

Read more at Arabian Supply Chain

Cutting out the middleman – milk price row

  • Consumers are being urged to boycott supermarkets and buy milk direct from farmers, to ensure producers receive a fair price. More than half a century after their heyday, local milk producers are back in fashion. After a collapse in the price they receive from retailers and processors for their milk, dairy farmers – who protested in large numbers over the past week – are turning to selling their milk directly to consumers.
  • While the number of dairy farmers in the UK continues to fall, from 200,000 in the 1950s to fewer than 10,000 today, a growing number are now cutting out the retailers and middlemen and once again offering up their milk locally.
  • It marks the revival of market that was lost with the emergence of refrigerated lorries and supermarkets in the second half of the last century. The use of milk as a loss leader by supermarkets to draw customers in made it impossible for a locally based dairy market to compete. But consumers and caterers are now being urged to boycott retail milk and buy direct from farms to help struggling dairy farmers receive a fair deal.
  • Although retailers and milk processors blame the falling price of milk on global markets, dairy farmers say they are being unfairly affected. They say supermarkets sell milk too cheaply as part of their price wars, and that farmers don’t receive a fair proportion of the final retail price.

Read more (and view the milk infographic) at The Guardian

Infor Buys Supply Chain Management Firm GT Nexus

  • Enterprise software firm Infor Inc. has agreed to acquire cloud-based supply chain management firm GT Nexus Inc. for $675 million, the company said Tuesday, as business solution providers race to accommodate the changing needs of supply chain executives.
  • New York-based Infor, which is one of the world’s largest suppliers of enterprise resource planning, or ERP, software, helps companies including aerospace, technology and pharmaceutical companies to track various components of their business. Oakland, Calif.-based GT Nexus provides cloud-based services, or software hosted on the remote servers, that allow companies to manage inventory and orders, and help companies communicate up and down the supply chain.
  • GT Nexus facilitates more than $20 billion in payments between buyers and their suppliers across 90 countries in eight currencies, according to a Tuesday release. Clients include Adidas AG, Caterpillar Inc., Deutsche Post DHL, A.P. Møller-Maersk, PfizerInc. and many manufacturers and retailers.
  • The deal comes as more companies are relying on technology to better manage, and gain more visibility, into the various functions within their supply chains, from sourcing to distribution. Sales of supply chain management software grew 10.8 per cent in 2014 to $9.9 billion.

Read more at The Wall Street Journal

New report raises alarm of modern slavery in supply chains

Tackling slavery in supply chains

The latest Risk Index Report from BSI identifies China, India, Vietnam, Bangladesh and Myanmar as the five highest risk countries for human rights violations.

The report highlights the significant rise in organisations breaching international human rights regulations over the last quarter as key Asian economies adapt to tougher economic conditions.

Rising labour costs in China have led companies to diversify their supply chains into other high-risk countries that now account for 48 per cent of global apparel production, 53 per cent of global apparel exports, and 26 per cent of global electronics exports.

The latest BSI Risk Index report warns that efforts by Asian governments to boost their economies are having the unintended consequence of allowing child labour abuses to become more present in supply chains. Also highlighted were proposed changes to labour laws that may incentivise firms to restructure as “family enterprises”, making it easier to employ under-age workers in a country where 4.4 million children are already put to work. Two thirds of child workers are found in agriculture (69.5 per cent), and 17.5 per cent in industries such as garment manufacturing.

The Quarterly BSI Risk Index is based on intelligence from BSI’s Supply Chain Risk Exposure Evaluation Network (SCREEN) tool. The tool identifies major CSR concerns, such as brand protection risks and changes to global regulation including the US legislation aimed at eliminating forced child labour, EU draft conflict minerals law, and the UK’s Modern Slavery Act.  All of which relate directly to complex supply chains worldwide and can subject an organisation to prosecution if their suppliers exploit human rights.

Those companies found in breach (legal repercussions notwithstanding), will also have to worry about brand reputation and the compromise of consumer trust. The latest generation of consumers, millennials, are focused on buying from ethical and responsible businesses, thus highlighting the increased importance for organisations to adopt a supply chain risk management program and implement risk-based sourcing strategies.

Modern incidents of slavery

 

Likewise the ability to ascertain country-level threats provides the needed intelligence to filter risk to underpin a socially compliant and responsible supply chain. On this very subject Mike Bailey, EMEA Director of Professional Services, BSI commented: “Some organisations underestimate the damage that can be caused by not adopting and enforcing ethical practices across their supply chain. Command and control from the centre means nothing if it is not rigorously monitored and enforced. For too long, extended supply chains have obscured ethically questionable practices, tools such as SCREEN highlight country level corporate social responsibility risks helping increase visibility and awareness, and enforce a responsible and ethical supply chain.”

Mike continued: “Organisations can no longer turn a blind eye to the actions of their suppliers. The laws we are seeing today may only apply to larger firms, but they set a benchmark for the industry and smaller organizations will be forced to comply to work with the larger companies, by default. Products assembled or services provided by child labour or depending on minerals from conflict zones have no place in the modern world.”

Premium payments are empowering cocoa farmers in Brazil

Under the Cargill Cocoa Promise, the livelihoods of cocoa farmers are being improved.

Empowering Brazil's cocoa farmers

In 2014 a total of $19 million was paid to farmers in Cote d’Ivoire, Brazil, Cameroon, Ghana and Indonesia, bringing the total to $44 million paid to date under the Cargill Cocoa Promise. The premiums, which are achieved by farmers for selling their UTZ, Rainforest Alliance and Fairtrade certified cocoa beans, are funded by confectionery and food manufacturers and retailers and are positively supporting the ongoing development of a sustainable cocoa supply chain.

Premium payments for certified sustainable cocoa are not only helping with meeting the growing demand for sustainably sourced cocoa and chocolate, but continuing to make a significant contribution to improving the livelihoods of cocoa farmers and their communities.

“Premium payments and cocoa certification remain a valuable catalyst in making progress toward a sustainable cocoa supply chain,” said Taco Terheijden, Director Cocoa Sustainability at Cargill – a provider of food, agriculture, financial and industrial products.

“We are proud to be part of this process and to see the positive developments in the sector. Not only are cocoa farmers and their communities benefitting from higher incomes and better health and education, at the same time manufacturers, retailers and consumers can be confident about where their cocoa is coming from and how it is being produced.”

The premium payments are made to certified farmer cooperatives with 50 per cent going directly to individual farmer members, and the remainder being invested in projects by the farmer organisation to boost productivity, farm development and benefit the community. The premiums are an incentive to adopt good agricultural practices and directly support improvements to make a positive difference to local communities.

Demonstrable progress can be observed  in Cote d’Ivoire, where a first of its kind public-private partnership between the Conseil du Cafe-Cacoa, Cargill and CARE has enabled 14 farmer cooperatives to use their premium payments to access additional funding.  With this they have built 11 new schools and three new health centres – teaching over 1650 children and providing access to healthcare for 25000 people.

Supply chain and procurement SMEs must act to future-proof pensions

If you’re doing business in the UK, you might want to heed this new warning issued by Lighthouse Group…

SMEs must act now to secure pensions

Supply chain and procurement SMEs must act fast to untangle payroll data to meet pensions auto-enrolment.

Many of the country’s 1.8 million small employers  approaching their pensions auto-enrolment staging dates are in danger of missing deadlines by underestimating the amount of data needed to complete the process.

According to the financial advisors, tens of thousands of supply chain and procurement SMEs and micro employers are now starting to grapple with the complexities of employer pension schemes for the first time. The Pensions Regulator recently stated that only 29 per cent of those staging in 2016 were fully aware of their date and only 46 per cent of those staging in 2017 were aware of their responsibilities.

Pensions expert Roger Sanders, OBE, cautions business owners to familiarise themselves with the requirements and assess their business as soon as possible, even if their staging date is two years away: “Employers’ auto-enrolment duties go far beyond setting up a pension scheme and enrolling staff in it,” he said. “They must assess their workforce, work out who to enrol and decide how much they and their employees will contribute. They also need to keep records of all this information, together with any changes, all of which represents a significant amount of work for smaller employers.

Roger continues: “However, we are finding many businesses in supply chain and procurement lack the accurate, up-to-date information on employees vital to completing enrolment smoothly. Firms that leave their enrolment preparation too late will be in for a shock when they discover years of payroll and employee data needs to be sorted before they can properly begin.”

Lighthouse advises that employers who use a payroll bureau should ask whether their systems and software are geared up to deal with auto-enrolment, assessing if they can extract needed information easily, in a suitable format, and on a regular basis.

A payroll bureau generally holds information such as an employee’s full name, their salary or wages and National Insurance number, but may not have the employee’s address and other contact details such as email, which is often held by the employer. However, under auto-enrolment all this information needs to be brought together each time an employee is paid, whether monthly, fortnightly or weekly.

SMEs should begin the process at least six months before their staging date, starting with checking what data their payroll function holds and how to export it, as well as what information is missing and must be tracked down. At three months before the staging date, businesses must have a process to collate all the information needed in a suitable format and on a timely basis. Data must be in a standardised format and should cover all employees, even if they will not be enrolled automatically.

Procurement: Is it a young person’s game?

We speak to 30 Under 30 Winner Nicholas Ammaturo on attracting Millennials to the profession.

Nicholas Ammaturo ISM 30 Under 30 Star

Procurious recently quizzed Nicholas Ammaturo on making his mark in the world of supply chain management and procurement.

Nicholas is one of procurement’s rising stars, as demonstrated by his entry into ISM’s 30 Under 30 Program.

Procurious asks: The challenges facing the Millennial workforce. Competition, the contract vs. perm debate etc.

Nicholas: I think the biggest challenge facing the millennial workforce in Procurement, is the misconception about us not working hard. In most examples, Millennials in this industry work much harder than they get credit. They are often generalized based on age and experience. There needs to be more of a sense of development, support as well as recognition.

Procurious: What [skillset] do today’s professionals bring to the table, that perhaps the CPOs of yesterday lack?

Nicholas: In some cases, today’s professionals have been acclimated with technology and are more comfortable with it. This is a mass generalisation, but there is a certain acceptance by younger generations and their approach to technology. Social Media is powerful and I have seen many masters as every age, but it’s more seamless for today’s professionals. A lot of things were previously built on relationships alone; today there are multitudes of tools from e-procurement to BI dashboards for KPI’s, in addition to the importance of relationships.

Procurious: What needs to be done to transform the profession, and bring it up-to-date?

Nicholas: Someone needs to address the Universities.

I made an attempt to connect with all the local schools and preach about Supply Chain/Procurement, but I got little traction.

I would like someone to back me and get more programs created, make this industry more relevant so we can build the bench. I think the industry is “sexy” and up-to-date; we just need to get the word out.

Procurious: Do you think it’s fair to say that most CPOs are running scared of social media?

Nicholas: Too funny, as I read this question and see my response above. I don’t think they are running. I see many of them embrace is. Some are fluent in LinkedIn and Twitter and put me to shame! I think they are the minority, so perhaps there needs to be more CPO’s out there who embrace it.

Procurious: How important is it to have a clearly defined brand today?

Nicholas: This is my goal every day. I am my own company. I happen to provide my services, but at the end of the day, you need to build your skills and advance your career.

Procurious: Let’s talk innovation – who/what is innovating in the procurement technology space right now?

Nicholas: Who isn’t playing in this space today? I can’t tell you how many cold calls I get. The most innovative thing I’ve seen is ScoutRFP. Smart guys who are going to shake the space up. I am looking forward to their success. I think Amazon innovation will drive innovation everywhere. They are continually re-paving some of the landscape in business and others are feeding off them, this will be no different than this industry.

Procurious: Is more innovation needed in the building and maintaining of supplier relationships?

Nicholas: No, I think more communication is needed. A simple phone call can solve everything; sometimes people are so keen to shoot of an email and are lose the personal connection. I think innovation and technology will keep people honest during the process, but communication and transparency are needed to make it more of a partnership than your traditional supplier/buyer arrangement.

Procurious: Would you recommend the ’30 Under 30 Program’ to those looking for a route into the profession?

ISM & ThomasNet’s 30 Under 30 Program is promising for young professionals. They have taken a stance to create awareness around the industry and have continued to make the investment. I was honored to receive the recognition. I think its motivating to see the others who share my passion and regardless of their education or role, they all love what they do. There was certainly a common theme when I reviewed all the winners and met them in person, most fell into the industry by chance and most will never leave it. We love it.

CEO of ISM on the Importance of Social Media in Procurement

Welcome back to the final instalment of our recent chat with ISM CEO, Tom Derry.

Social media is key to procurement's future

 

To wrap up our chat with Tom, we discussed the important role that social media plays in the development of the procurement and supply chains professions.

Procurious asks: At Procurious we’re passionate about how social media and connecting a global network of procurement and supply chain professionals can improve the profile of our function, promote knowledge sharing and ultimately enable people be better at their jobs. Do you see a role for social media in the development of procurement and supply chain professionals?

Tom Derry: I honestly I don’t see how anybody could plan to be an effective professional in our field without using the social media tool kit. There are lots of reasons for this. Social media is a vital part of the way we work. The opportunities for procurement and supply chain professionals in social media are huge.

Social media is critical for connecting procurement professionals. It allows people to share information in a private and confidential manner and to leverage a global knowledge base to get answers to questions you just wouldn’t get otherwise.

Being connected through social media means people can understand and monitor the risks that are present in their markets. I’ve heard stories of our members getting procurement market information off Twitter, learning about labor unrest in their overseas supply chains and fires at supplier manufacturing facilities. All of this information is available in real-time through social media.

Twitter itself is becoming such an important source of data for the procurement and supply chain function.

More and more, we need to be able to contact people and pull on extended networks to gain reliable and current information.

I believe that social networks will continue to grow in importance over the coming years, particularly as younger people, who are more familiar with social media, move into managerial roles.

I really don’t see how you could be an effective procurement or supply chain professional without fully engaging in the social media space.

I think Procurious is right where it needs to be. By connecting procurement people across the globe, you are absolutely building on the right idea at the right time and adding greatly to the function. With the exception of possibly finance, I can’t think of a more globalised profession than procurement and supply chain. I certainly can’t see how procurement and supply professionals could even consider creating a successful career, without having an active presence on social media.

Want to read more from Tom?

Bridging the procurement talent gap with ISM CEO Tom Derry
Tom Derry on Innovating from your supply base

Big Data Will Revolutionise Supply Chains – And Here’s Why…

We know what you’re thinking – “Not another article on data”! But stick with us as, like data itself, the information on it keeps evolving. And can you really ever know all there is to know about data for your business?

Big Data Will Revolutionize Supply Chains - And Here's Why...

Every individual in an organisation comes into contact with data, and is in some way responsible for that data too. We all spend a lot of time with data at home too – it helps to inform our personal purchasing decisions, from coffee to holidays.

Using Data

The main problem, from both a personal and organisational point of view, is how to use the data we have (this is, of course, after working out what data to use first). For now, we’ll just focus on organisational data that can be used to inform procurement and supply chain decisions.

Increasing connectivity, plus an abundance of devices with the ability to collect data, means that decision making and analytics can be carried out with a greater wealth of information. In procurement, this data helps inform spend analysis, identification of correlations and drivers and trends across purchasing activities.

Identification of trends helps procurement create accurate predictions and improve spend management by knowing when and where items are being used and at what rate. This can assist with assessment of requirements, standardisation of products in a catalogue and will ultimately make a positive difference to budgets.

Data Quality

Dr David Hames, Founder of Science Warehouse, believes that data will be a driver in organisations in the future, both in B2B and B2C transactions. Speaking to Procurious at the Big Ideas Summit 2015, he caveated this by highlighting a concern that many procurement professionals have – data quality and integrity.

In order to be used effectively, David states that data needs to be:

  • Cohesive
  • Comprehensive
  • Accurate and detailed
  • Subject to Quality Control from experts

It’s difficult to guarantee all of these, but unless you can be confident in the quality of your data, you can’t be confident in the value of your analytics.

Cyber Security

Data integrity is another concern for organisations. Greater connectivity has lead to concerns that individuals are organisations are more vulnerable than ever to cyber attacks.

Sony Pictures, Ashley Madison, Carphone Warehouse and the US Government – in the past 6 months all of these have been high-profile targets for cyber attacks.

A report by Quocirca this year highlighted the concerns that organisations have around data security and data protection. Only 29 per cent of the organisations surveyed marked themselves as very confident about data security (this figure dropped to 16 per cent across the retail and distribution industries), while 10 per cent they were not confident at all.

Those who were very confident showed common policies around education of employees, defined and streamlined approaches to security and highly co-ordinated approaches to both internal and external threats to security.

The Secret to Good Data

Is there a secret to good data? We’d love to say that there is an easy solution for organisations, but it’s not as straightforward as that.

Good starting points include training and educating employees, having robust processes and policies and having someone who can check the quality of the data in the systems.

And, if you’re using an integrated system for procurement and other departments (e.g. Finance; IT), make sure your data is good before you switch on, otherwise you’re going to be fighting a battle from the off. Good data in, good data out. Bad data…well, you know the rest.

Do you have a secret to good data? A success story of leveraging data in procurement and reducing costs? We’d love to hear all about it, so get in touch.

And to set you up for your water-cooler/coffee line conversations this week, here are all the key headlines in procurement and supply chain.

Coca-Cola bottlers agree three-way Europe merger

  • Three of Europe’s main bottlers of Coca-Cola products are to combine in a $27bn deal to simplify manufacturing at the world’s largest drink maker as it seeks to cut costs at a time when consumers are shifting away from its famous sodas.
  • Coca-Cola Enterprises, the US-based bottler with exclusive Coke licences in several western Europe countries, will merge with its Iberian and German counterparts in the latest consolidation of the Coca-Cola Company’s supply chain.
  • The merger comes as Coca-Cola is confronting a decline in fizzy drinks sales, especially in developed markets, which make up almost 70 per cent of the company’s overall revenues. In response, the drinks group is looking to cut costs to boost profitability. Initiatives have included reducing the size of beverage bottles, generating more profit per ounce, as customers fall out of love with excess.
  • In an internal memo to staff, James Quincey, president of Coca-Cola in Europe, said the deal would improve the company’s ability to respond more swiftly to changing consumer trends. He added that the merger would enable the bottlers to improve efficiency in its supply chain, sales and distribution.

Read more at the FT

Britain in Summer Rush of Supply Chain Contracts

  • Supply chains for two of Britain’s largest defense programs have benefited in the last few days from a rush of production contract awards by industry primes BAE Systems, General Dynamics and Lockheed Martin.
  • By early August, with Parliament on its summer recess and people’s minds here turning to the beach, it’s normally a quiet time on the announcement front for defense. The last few days were different, though. Fourteen contracts from across supply chains that include equipment from Austria, Germany and the US, as well as the UK, were announced for three British programs.
  • The contracts illustrated the increasing globalization of defense supply chains and emphasized the continued willingness of the British to look overseas for equipment. It’s something the British government hopes to see reciprocated more by its allies.
  • International supply chains, and Britain’s role in them, were on British Procurement Minister Philip Dunne’s mind when he visited Washington recently and talked up Britain’s ability as an equipment supplier. “We have been actively encouraging US and other non-UK domicile primes to come into the UK to explore our supply chain,” he said in a speech July 28.

Read more at Defense News

Fast fashion propels Zara into shopping stratosphere

  • Amancio Ortega, the co-founder of Zara, is now the world’s second-richest man, putting him above Warren Buffet and just behind Bill Gates. On Wednesday his Inditex parent company, under which Zara sits, reached a valuation of €100 billion for the first time in its 30-year history.
  • Of the eight brands housed under Inditex, which was founded by Ortega and his former wife Rosalia Mera in 1985, Zara is the flagship and, as of December 2014, represented 66 per cent of total sales.
  • Zara’s in-house design team can have an item in stores within three weeks. That’s three weeks from the beginning of the design process to the time it lands on the shop floor for us to buy.
    Where most companies will lock in 100 per cent of the forthcoming season’s stock six months in advance, Zara only locks in 15 to 25 per cent that far in advance, according to tradegecko.com.
  • By the start of the season that percentage will have increased to 50 or 60 per cent, meaning the remaining 50 to 40 per cent is still up for discussion; if a new trend appears mid-season, Zara has the capacity to follow it and get its interpretation into stores, while its competitors can’t.
  • Similarly, if things aren’t selling, it has the ability to alter them or simply discontinue supply. This is aided by the fact that between 51 and 55 per cent of Zara’s clothing is manufactured in what the company describes as “proximity” markets; Spain, Portugal, Turkey and Morocco, instead of Asia.

Read more at Telegraph

Cargill to map canola oil supply chain

  • Food firm Cargill is to map the supply chain of its high oleic canola oil as part of a transparency initiative.
  • From October, the ‘Knowing Your Roots: from farm to table’ programme will take customers and consumers through the whole supply chain, from seed development and the farmers who grow the canola, through oil processing and packaging, to the food service operators and food ingredient manufacturers who use the product, and to consumers.
  • Cargill said it could provide a transparent supply chain because it is a high oleic canola oil supplier and also a seed company. “Understanding where food comes from is a priority for consumers,” said Kristine Sanschagrin, marketing manager of Cargill Specialty Seeds & Oils. “This initiative offers our customers the opportunity to tell that story.

Read more at Supply Management

Supply Chain Analytics Are ‘Looking In The Rear-View Mirror’

Is this what the future of supply chain analytics looks like?

Supply chain analytics are 'stuck in the rear-view mirror'

A new study that highlights the current and future state of supply chain analytics has confirmed that the future of supply chain analytics is visual, multi-sourced and predictive.

According to the study, the majority of today’s supply chain analytics are “looking in the rear-view mirror” when it comes to evaluating performance, but realise the potential value of adopting advanced analytics.

More than 40 per cent of respondents said they are still almost exclusively backward looking when it comes to data analysis. However, the vast majority expressed the belief that predictive analytics would bring value to users, enabling them to leverage data at the point of decision. Additionally, more than 88 per cent of respondents ranked advanced analytic capabilities as an outstanding or good opportunity for their organisation. Respondents also noted that making improvements in data and analytic capabilities was either a high priority or something they were already focused on doing.

The study revealed that while companies are realising the value and urgency of implementing advanced analytics, few feel they are where they need to be. When evaluating their own current capabilities generally, less than 10 per cent felt they had high levels of user system flexibility and empowerment, data visualisation and supply chain risk management capabilities.

“Despite early stages of maturity, companies see significant potential from improvements in data management and analysis,” said Dan Gilmore, President and Editor in Chief at SCDigest. “Not surprisingly, improved supply chain decision-making tops that list, while similarly, becoming more ‘forward-looking’ was the number one opportunity identified by respondents from improved data management and analytics.”

The Qlik-commissioned study is a result of a global survey launched by SCDigest of its readership around the subject of how companies are planning to leverage their supply chain data, including the capabilities they have in place now or intend to develop over the next few years.