Category Archives: In The Press

Could North Sea Cod Be Back On The Menu?

A recent assessment of fish stocks indicate that cod might soon lose its ‘fish to avoid’ status as the fish’s population is growing at a near-sustainable rate.

Cod levels in the North Sea have returned to healthy status

The International Council for the Exploration of the Sea (ICES) has delivered an overview of the status of a host of fish and shellfish stocks across the Northeast Atlantic.

The Marine Conversation Society introduced tight controls on cod and plaice in 2006 owing to dwindling supplies, but those limits look set to soon be lifted thanks to the healthy numbers revealed in the new report.

The general picture indicates that the level of exploitation brought about by decades of overfishing has now been reduced. This has been determined in accordance with the advice provided by ICES and in line with management objectives for sustainable fisheries.

​​​​​​​​​​​The Chair of ICES Advisory Committee, Eskild Kirkegaard, said: “Over the last ten to fifteen years, we have seen a general decline in fishing mortality in the Northeast Atlantic and the Baltic Sea. The stocks have reacted positively to the reduced exploitation and we’re observing growing trends in stock sizes for most of the commercially important stocks.”

For the majority of stocks, it has been observed that fishing mortality has decreased to a level consistent with Maximum Sustainable Yield (MSY) – meaning levels that are not only sustainable but will also deliver high long term yields. The information encompasses around 150 stocks, of which cod and plaice were among their number.

In technical terms North Sea cod has seen a downturn in fishing mortality and an upturn in Spawning Stock Biomass (SSB) – which [crucially] means cod stocks are increasing, whereas North Sea plaice is now considered to have reached record high levels.

According to various sources the Marine Conservation Society have welcomed the news and are currently looking at improving cod’s rating in the coming weeks. It was originally feared that the diminished supplies, coupled with the increase in demand, would result in significant price-hikes come fish Friday. With the healthier picture coming out of the North Sea, it now looks like the UK (at least) will escape such a fate. However it’s a different story for the Mediterranean where latest estimates claim 91 per cent of the region’s stock is overfished.

20 Most Promising Procurement Solution Providers in 2015

Which companies have been recognised among CIO Review’s Twenty Most Promising Procurement Solution Providers?

Who's made it into the Top 20?

CIO Review has published their list of the ‘Twenty Most Promising Procurement Solution Providers in 2015’.

The list of best in class providers features supply chain qualification leader, BROWZ along with other industry favourites; Ariba, SciQuest and Zycus to name a few.  A complete listing of recognised providers can be found in this month’s edition of CIO Review.

CIO Review is a US technology magazine that informs readers on the enterprise solutions that will define the businesses of the future.

According to the publisher: “We present you with the 20 most promising procurement solution providers of 2015, featuring the best solution and service providers offering tools and services on the procurement landscape. The companies featured in this issue, have exhibited extensive business process knowledge combined with innovative strategies. A distinguished panel comprising of CEOs, CIOs, and analysts including the CIO Review editorial board have selected the top companies that are at the forefront of tackling challenges in the procurement landscape.”

Elaine Beitler, BROWZ, CEO, says “As a former CIO, I valued this magazine as a resource for information on new innovative technology solutions that could be applied strategically to advance the business. I’m proud of this accomplishment and congratulate all of those being recognized in this impressive list of companies.”

In addition to being named one of the ‘Twenty Most Promising Procurement Solution Providers in 2015,’ BROWZ is highlighted in a four page article of the magazine. In the article, Beitler discusses the challenges organizations face today when hiring and qualifying contractors and suppliers.

“Contractor screening is only one part of the equation,” says Beitler. “We’ve created a global compliance network that connects buyers and suppliers of goods and services. We work to ensure buyers have the solutions in place, to not only screen, but manage the ongoing compliance of their supply chain. Most organizations don’t have the resources or tools necessary to do an adequate job, especially once a bid has been awarded. We’re working with the world’s largest companies – ensuring they have safe, qualified and socially responsible supply chains. This is only possible when you have an end to end solution to address the risk that exists at all levels of the supply chain.”

Is a lack of collaboration to blame for procurement perception gap?

Is a lack of collaboration between procurement and critical business functions to blame for squandering budgets of UK businesses?

Are procurement rule breakers squandering UK business budgets?

Procurement’s true value is held back by restrictive corporate cost saving edicts according to new research published today.

The ‘Procurement Perceptions’ study was carried out by Redshift on behalf of Wax Digital. It took into account the views of 200 procurement, finance, IT and sales & marketing department decision makers in medium to large UK organisations.

The main brunt of the report aims to address the scale of rule breakers using risky suppliers and spending without necessarily seeking permission from decision-makers.

Daniel Ball, Director, Wax Digital, says: “Business functions are not working effectively and closely with procurement experts to source the right suppliers, strategically manage their spending and ensure they are following compliant purchasing processes. This suggests a high level of maverick spending behaviour which can lead to poor value for money, cash flow issues and contract risk.

Daniel continues: “Procurement wants to control and influence departments’ supplier choices and spending, however, many of these other departments are pushing back, seeking more supplier and spending freedom and believing that procurement just gets in the way.”

The comments are backed-up by figures that reveal 24 per cent of procurement respondents said that supplier selection was a joint decision with the department in question. This is in stark contrast to the 8 per cent in IT, 6 per cent and 2 per cent in sales and marketing.

Procurement perception gaps

The study found that part of the problem lies in the perception of procurement amongst other departments. Procurement is typically viewed as being more administrative than strategic, while in reality the balance lies somewhere in the middle. In Wax Digital’s research Just 15 per cent of other department respondents saw procurement as mainly or wholly strategic but 46 per cent saw procurement as mainly or wholly administrative.

Other findings include: 54 per cent of procurement respondents say departments follow a formal tender process, compared to 24 per cent in sales and marketing.

36 per cent of procurement say they shortlist suppliers on behalf of these departments against their business requirements, but only 12 per cent in IT agree.

In conclusion Daniel offers a few recommendations: “This research indicates that there is still some distance to go by procurement, or a need for improved communication, before other critical departments understand the benefits of procurement, stop breaking the rules and close the perception gap.”

Businesses See Risky Supply Chains As Top Challenge

New survey says risky supply chains are a challenge for 77 per cent of businesses across North America and Europe.

Xchanging report says 77% of businesses see risky supply chains as challenge

Xchanging have recently issued the results of the second portion of its Procurement Study.

The survey polled 830 procurement decision makers regarding what they view as the top threats in the Procurement space.

Procurious covered the previous research here.

Xchanging’s research reveals the greatest external challenge for businesses’ operations is supply chain risk, with more than three quarters (77 per cent) of respondents claiming this is a challenge, and 17 per cent an ‘extreme challenge’.

Around two thirds of respondents claim to be challenged by regulation and audit (71 per cent); lack of supplier innovation (63 per cent); and fluctuations in currency (58 per cent) in their business operations.

Owing to the high number of respondents challenged by supply chain risk, Xchanging dug further into the specific supply chain threats faced by European and North American businesses.

Greek debt crisis and oil prices are both causes of concern

More than a quarter of respondents (28 per cent) see currency and exchange rate fluctuations as a significant external threat. This jumps to 35 per cent in respondents from mainland Europe, with the Euro still under pressure against the Pound and other major currencies, and nervousness in the region over Greece’s debt negotiations. 

Similarly more than a quarter of respondents (26 per cent) also cite oil prices as a major external threat to their businesses. Notably global oil prices having fallen sharply in recent months (by more than 40 per cent since last summer), leading to significant revenue shortfalls in many energy exporting nations and concerns about oversupply in some markets.

Coupa Software has acquired Australia’s InvoiceSmash

To the cloud! Coupa acquires InvoiceSmash to drive B2B commerce transformation.

Coupa has acquired InvoiceSmash

Cloud-based spend management provider Coupa last week acquired InvoiceSmash, an Australian company that manages the accounts payable and invoicing process.

The motivation for the acquisition is thought to be the fact that the data extraction capability of InvoiceSmash will facilitate further automation of Coupa’s invoicing and accounts payable offerings.

At the announcement of the acquisition it was claimed that the move was: “Designed to help enterprises of all sizes digitize and automate the often painful accounts payable and invoicing process, the InvoiceSmash innovations will be embedded into Coupa’s organic cloud-based platform to instantly convert emailed invoice attachments into the field formats required by Accounts Payable.”

Rob Bernshteyn, CEO of Coupa, said: “Our acquisition of InvoiceSmash is a huge step forward for the industry. The InvoiceSmash technology will help businesses large and small transact faster and easier than ever before with significantly less manual intervention,” said Bernshteyn.

“The InvoiceSmash technology will be a hugely value-added extension to our organic suite of capabilities and will drive immediate value, supporting the very essence of Coupa’s Savings-as-a-Service approach.”

How does InvoiceSmash work?

According to company’s website (which is now jointly branded with the Coupa logo), InvoiceSmash works in the following way:

  1. Get it to InvoiceSmash – Send invoices to InvoiceSmash via your unique email address or upload it. InvoiceSmash extracts the data and prepares it for posting to your accounting system.
  1. Your Approval – During approval you set the purchase just the way you want it. Contact, General Ledger, Job, Item and Inventory coding is fast and easy. Contact / inventory creation is just one click. Hands free auto-submission is also possible for repetitive invoices!
  1. It Remembers! – After the invoice is posted to your accounting system, InvoiceSmash remembers your choices and will apply them to future invoices. Submitted invoices are archived in the cloud. No more data entry!

The InvoiceSmash system is said to be an intelligent learning solution that can detect changes in supplier invoice formats. New invoice layouts are memorised by the system, so that if they appear again they can be quickly processed.

At the time of writing, the terms of the acquisition had not been announced. Coupa did state however, that it expected to make the InvoiceSmash capabilities available to a select customer group by the end of 2015.

Is Your Organisation’s Sustainability Program As Good As This?

The Fruits Of Nespresso’s Sustainability Program Revealed.

Nespresso's Sustainability Program

On the one-year anniversary of The Positive Cup, Nespresso’s 2020 sustainability strategy, Jean-Marc Duvoisin, CEO of Nestlé Nespresso, has announced that significant progress had been made towards improving the lives of thousands of coffee farmers.

The Nespresso AAA Sustainable Quality Program was developed with the NGO the Rainforest Alliance to secure the supply of highest quality coffees, protect the environment and improve farmer welfare. Over 63000 farmers are now taking part in the program in 11 countries, benefiting from technical assistance, trainings, price premiums and investments in infrastructures.

Over the past two years Nespresso has been working with its partner TechnoServe to help rebuild the coffee sector in South Sudan, resulting in the country’s first-ever coffee exports in 2013, and its first non-oil export to Europe. Nespresso aims to produce a new rare coffee from South Sudan, while providing alternative sources of sustainable income to local farmers.

The fruits of the Nespresso AAA Program are already being felt, as Joseph Malish Thomas, a South Sudanese farmer, attests: “I have seen that there is great change within the community. We want to produce the right quality. People now have hope. We will be able to pay school fees for children and in the end develop the country.”

Nespresso aims to source 100 per cent of its coffee from its AAA Sustainable Quality Program by 2020. This depends heavily on the extension of the program into Kenya and Ethiopia, to support a more skilled, self-sufficient and sustainable farming community. In the last 12 months Nespresso and TechnoServe have provided training and technical assistance to over 10000 farmers, and will reach 50000 farmers by 2020.

Nespresso has also progressed with its agroforestry plan. The reintroduction of trees in coffee producing regions helps protect natural ecosystems, thereby strengthening coffee farms’ resilience to climate change and ensuring sustainable coffee production for the future. Around 130000 trees were planted in 2014 in Guatemala and Colombia as part of pilot programs. In the first half of 2015, approximately 200000 trees have been planted in Ethiopia and Guatemala, and another 300000 will be planted by the end of 2015 in Mexico and Colombia.

“The Rainforest Alliance has been working with Nespresso and the AAA Program since it was first created in 2003.  Together we have seen great achievements that have delivered tangible improvement to lives of coffee farmers, families and communities, as well as environmental and biodiversity benefits,” said Tensie Whelan, President of the Rainforest Alliance. “The progress being delivered by Nespresso, the Rainforest Alliance and Pur Projet through the agroforestry plan is building on that success, helping farmers to improve their resilience to the real and present threat that is climate change.  Working together we are showing that care for the environment and for coffee farmers is a fundamental part of supplying the highest quality coffee to Nespresso’s consumers around the world.”

ISM Reports US Manufacturing Has Risen To Five-Month High

The Institute of Supply Management sheds some light on the current state of manufacturing in the United States.

ISM Reports US Manufacturing Has Risen To Five-Month High

The Manufacturing ISM Report On Business is based on data compiled from purchasing and supply executives nationwide

In general respondents were upbeat about the economy. Some of the key insights from its June report include:

  • “Avian flu is having a huge effect on egg pricing and items manufactured with eggs.” (Food, Beverage & Tobacco Products)
  • “Automotive industry remains strong and is expected to stay that way through 2015.” (Fabricated Metal Products)
  • “Business continues to hold in the U.S., [but is] soft in Europe and in decline in Asia.” (Transportation Equipment)
  • “Manufacturing business has improved slightly.” (Chemical Products)
  • “Slight improvement in defense spending on future business.” (Computer & Electronic Products)
  • “Most prices are stable and business is stable.” (Nonmetallic Mineral Products)
  • “Downturn in oil and gas markets impacting demand.” (Miscellaneous Manufacturing)
  • “Stable. Extra capacity available if more orders come in.” (Textile Mills)
  • “A bit slow. Sales down from last year.” (Machinery)
  • “Business continues to be strong, with housing starts being up in our markets driving cabinet sales.” (Furniture and Related Products)

Barclays economists distributed the following note to clients following the release: “Looking ahead, the recent pickup in the forward-looking survey components suggests a modest improvement in output and employment for domestic manufacturing… We do not expect a robust rebound given the lingering effects of a stronger dollar and lower oil prices; however, we view a modest H2 manufacturing rebound as increasingly likely.”

H&M Struggle with Strong US Dollar

Fashion retailer H&M’s profits miss forecasts thanks to might of US dollar.

H&M hit by strong US dollar

The world’s second largest fashion retailer, H&M, is facing a significant reduction in its profit outlook. The bleak outlook is due largely to changing currency valuations and their impact on the firm’s supply chain.

Despite rapidly increasing sales figures, the firm has warned of a “very negative” impact to its bottom line based on the growing strength of the US dollar.

H&M has suggested that the strengthening US dollar will cause second quarter profit figures to take a significant hit. It’s also likely that these troubles will continue into the second half of the year as analysts suggest the value of the US dollar will continue to improve against most other currencies.

The currency exposure the firm is facing is due to the structure of its supply contracts. H&M sources the majority of its products from Asian markets. The contracts for these garments are agreed and signed in US dollars. However most of the retailer’s sales take place in the European market and are conducted in either Euros or Pounds.

It therefore follows that as the value of the US dollar increases against the Euro and the Pound, the cost of H&M’s garments and raw materials experience a relative increase. This means that unless the firm elects to increase in-store pricing, the margin it makes from selling each garment reduces. Clearly, this has a detrimental impact on the firm’s profitability.

One would imagine that the procurement and supply chain departments at H&M identified this currency exposure some time ago and have established a form of currency hedging as means to minimise its impact. But, it should certainly prompt questions in the minds of procurement and supply chain managers with cross currency operations to take a closer look at their currency exposure.

New Runway Offers Freight Potential, While US Investigates ‘Collusion’

The airline industry is a popular news topic, appearing on two fronts this past week. The decision on a new runway for London got people talking about airfreight, while in the US, an investigation was announced by the Department of Justice into alleged collusion.

All eyes on Heathrow expansion plans

New Runway Plans

Last week, a UK Government commission selected Heathrow as the preferred location for a new runway to be built in London. Following the publishing of the report, UK Prime Minister, David Cameron, confirmed that a final decision would be made by the end of the year.

The plans for Heathrow, already the busiest passenger airport in Europe and third busiest in the world, appear to have beaten competition from London Gatwick and a proposal for a brand new airport in the Thames estuary.

While it appears that the debate will rage on until the final decision is made at the end of the year, business leaders and UK organisations have welcomed the decision. With Heathrow currently operating at 98 per cent capacity, many think that this is directly impacting business and freight.

‘Importance of air freight’

The freight industry believes that additional runway capacity at Heathrow is required in order to service new markets in Asia, South America and the Indian sub-continent.

The Chief Executive of the UK’s Freight Transport Association (FTA), David Wells, stated that, “80% of freight is carried in the holds of scheduled passenger aircraft using Heathrow Airport.”

“Whereas passengers could be persuaded to use a different airport, the diminution of Heathrow as an international air cargo hub favours neither the country nor the economy,” Wells concluded.

Future Exports

The commission report highlighted future exports for the UK as a reason for their decision. The report stated, “By 2030 advanced manufacturing industries such as pharmaceuticals or chemicals, whose components and products are predominately moved by air, are expected to be among the top five UK export markets by their share of value.”

Sir Howard Davies, Chairman of the Airports Commission, who compiled the report, went on to say that the Heathrow option provided the “greatest benefits for business passengers, freight operators and the wider economy”.

While it remains to be seen if the UK Government will go along with the Commission recommendation, it does appear that business might benefit from a new runway at Heathrow.

Collusion Investigation

Over in US, the industry is in the news for less positive reasons, with the Department of Justice (DoJ) announcing a new investigation into alleged collusion between some of America’s biggest airlines.

United Airlines, Delta Air Lines, American Airlines and Southwest Airlines have all confirmed that they are part of the investigation, which will focus on whether the airlines have been coordinating to keep tickets available at a steady number, artificially increasing demand and driving up prices.

The four airlines account for 85 per cent of the domestic routes across America, partly due to two high-profile mergers in the past year. The investigation also comes at a time when airlines are posting huge profits due to the falling oil prices.

Questionable Outcomes

However, many commentators believe that the investigation will not produce outcomes that will be of benefit to consumers. For one, it is hard to prove that airlines are actually colluding to keep availability low, as with better technology, information on both capacity and pricing can be found easily and immediately.

There is also an argument to say that it would be just as effective to let markets sort out collusive behaviour on their own. There are other ways to ‘collude’ beyond pricing, but ultimately, if inefficiencies appear in the market, new competitors will emerge or consumers will look elsewhere to satisfy their needs.

Whatever the final outcome of the investigation, it looks as though there will be greater scrutiny on the airlines in the coming months. While it may not lower prices in time for the busy summer holiday period, there is a chance it may push the airlines to be more transparent and act in a favourable way for consumers.

Do you live near Heathrow or commute through there regularly? What do you make of the decision for a third runway? Do you think the DoJ investigation will make any impact? Let Procurious know what you think.

While you think about that summer sunshine, have a read through the headlines from the procurement and supply chain world this week.

BP agrees to $18.7 Billion payout for deadly 2010 oil spill

  • BP agreed on Thursday to pay $18.7 billion for damages caused by its oil rig explosion in the Gulf of Mexico in 2010, an accident that resulted in the deaths of 11 people and the largest marine oil spill in history.
  • The settlement covers lawsuits filed by parties including the U.S. government, five U.S. states that were affected by the spill, and several hundred local government organisations. It also includes a civil penalty of $5.5 billion under the U.S. Clean Water Act.
  • The settlement, which comes in addition to the hefty sums that BP has already had to pay in legal and clean-up fees over the last few years, will be paid over 18 years and is expected to end the majority of BP’s litigation wars over the accident, though the company still faces shareholder lawsuits and some outstanding costs from a 2012 class action settlement.
  • With this new settlement, BP’s total bill for the spill climbs to $53.8 billion—a number that exceeds the company’s profits in the last three years.
  • Carl-Henric Svanberg, BP’s chairman, said in a statement that the agreement offers “a path to closure” for BP and the Gulf. “Five years ago we committed to restore the Gulf economy and environment and we have worked ever since to deliver on that promise,” he said.

Read more on Slate.com

Fast fashion retail market trends and opportunities 2015-2019 shared in new research report

  • The report titled “Fast Fashion Retail Market: Trends and Opportunities (2015-2019)” analyzes the potential opportunities, challenges, demand drivers and significant trends representing fast fashion industry in the world.
  • The report gives valuable insight into various types of brands of fast fashion such as ZARA, H&M, Uniqlo and GAP.  It profiles and analyzes the leading five companies operating in this industry with an overview of their business and finance structure along with a brief discussion of their future business strategies.
  • The report also studies the growth pattern in the fast fashion retail market and the latest trends concerning fast fashion. Further, the report analyzes the current market size and project future market size of the overall fast fashion retail business for the years to come.

The complete report is available to download here

From trash to treasure: Adidas designs shoes made of ocean garbage

  • German sportswear brand Adidas has joined forces with Parley for the Oceans, an organisation formed in 2013 dedicated to undertaking projects to protect and conserve the Earth’s oceans.
  • To raise awareness about ocean pollution, Adidas has designed a prototype pair of sneakers with an upper made entirely from recycled ocean waste and illegal deep-sea gillnets.
  • These gillnets were retrieved by Parley for the Oceans partner Sea Shepherd, which spent 110 days tracking an illegal poaching vessel, finally catching it off the coast of West Africa.
  • “We are incredibly excited to join Parley for the Oceans as they bring the cause of the oceans to the attention of the United Nations,” said Adidas’ Eric Liedtke. “Adidas has long been a leader in sustainability, but this partnership allows us to tap into new areas and create innovative materials and products for our athletes. We invite everyone to join us on this journey to clean up the oceans.”

Read more at CNET

Supply chain workers urge Walmart to act on supplier standards

  • Walmart must do more to improve supply chain transparency and hold its suppliers accountable, according to a study from the Food Chain Workers Alliance. The report includes research on 11 different food-related industries in the retail giant’s supply chain, as well as on the corporation’s impact on local farmers.
  • The alliance said the retailer should do more to hold suppliers accountable to labour and environmental standards. The report, Walmart at the Crossroads: the Environmental and Labor Impact of Its Food Supply Chain, calls on the company to enforce its existing labour and environmental standards and fulfil its goals for local food purchases.
  • The report also contains a raft of recommendations for the supply chain. It said Walmart should improve its supply chain transparency by requiring suppliers to identify the names and addresses of all factories, farms, fishing vessels, or other entities that contribute to the product being purchased before a supplier contract is awarded. This information should be made public, the organisation which represents workers in the food supply chain said.
  • The study also called for an independent, third party body to monitor and verify supplier compliance with Walmart’s labour and environmental standards. Suppliers should have long-term contracts and be paid fairly, and should pay workers fairly.

Read more at Supply Management

Three-quarters of business leaders think Greece will leave Euro within the year

In the heat of the Greek banking crisis, an overwhelming majority predict Greece will leave the Euro behind.

Will Greece leave the Euro behind?

in a survey conducted by the Institute of Directors (IoD), business leaders were quizzed on Greece’s monetary troubles. Three in four IoD members think it’s likely Greece will be forced to leave the European single currency within the next twelve months, against only 2 per cent who think it is very unlikely.

Procurious asks: What impact will a “Grexit” have on the UK economy?

The most probable outcome of “Grexit”, IoD members say, is a messy default which negatively affects financial markets and creates pressure on other Euro members. This outcome was considered likely by nearly two-thirds of the business leaders surveyed, while 45 per cent also think there was a risk of widespread bank runs in other southern European countries. Longer-term, 45 per cent of members say there is a good chance “Grexit” will be followed by other countries leaving the Euro. 

three-quarters of business leaders think Greece will leave Euro within the year

While the direct exposure of IoD members to Greece is limited, with 77 per cent having no business interests in the country, nearly half think that a Greek exit from the Eurozone would have a negative impact on the UK.

Commenting on the results, Simon Walker, Director General of the Institute of Directors, told Procurious:

“British businesses are nervous about the potential knock-on effects of “Grexit” on the UK economy. They have reduced their direct exposure to Greece in recent years, but are worried that a messy divorce from the single currency would shake markets across the continent and destabilise the already fragile economies of other southern European countries. IoD members do not expect the chaotic situation in Greece they see on the evening news to end anytime soon. 

“There is a heated debate going on about whether it would be better for the Greek people if they left the Euro, but it’s clear that their decision at the referendum on Sunday has significant implications for the whole of Europe.”

three-quarters of business leaders think Greece will leave Euro within the year

Procurious asks: What impact will a “Grexit” have on the UK economy?