Purchasing articles from August 2007

Purchasing archives from August 2007

All eyes look to MRO.(maintenance, repair and operations)
August 16, 2007... By Susan Avery For the sixth straight year, Purchasing selects its top MRO buyers based on nominations from peers, managers, and suppliers. The eight members of the team for 2007 demonstrate that MRO is strategic, impacts the bottom line,...

'Sorry, no price break possible'.(Brief article)
August 16, 2007... By Staff Among the possibilities: Continue paying the ever-increasing cobalt costs; change the generator design. What would you have done? See purchasing.com/negotiations for the solution the buyer negotiated. In a previous role as...

Quality, testing are key priorities in sourcing ingestible materials.(ingestible ingredients to be outsourced successfully)(dietary supplements rules)(briefs)
August 16, 2007... By David Hannon A rash of supplier quality issues has global buyers of ingestible materials on alert. But global sourcing of ingredients doesn't have to be risky if supply chain professional do their jobs. With recent horror stories...

Demand surge impacts specialty chemical prices in various ways.
August 16, 2007... By Gordon Graff Surging demand is having a variety of impacts on specialty chemicals prices, depending on the maturity of downstream markets for the respective chemicals. For many well-established specialty chemical sectors, increased...

Business Intelligence.(prices of inorganic chemicals)(BASELL C.V. merged with Lyondell Chemical Co.)(briefs)(Brief article)
August 16, 2007... By Staff 24% Buyers reporting price hikes for inorganic chemicals Source: www.purchasingdata.com WHAT IT MEANS: It's a significant drop from the 41% reporting hikes only two months prior. The outlook is good as well, with...

Plastics additives go green.
August 16, 2007... By Staff The increase in recycling is impacting the plastics additives market, says Fred Gastrock of Townsend Polymers Services. The concern is that residual additives in recycled plastics may cause problems such as poorer processability,...

Electronics buyers turn to distributors for design help.
August 16, 2007... By James Carbone Lean design staffs, shrinking time-to-market and the need to lower costs are driving buyers to look to distributors, especially for small and mid-size manufacturers. Design in some parts of the electronics supply chain...

Supplier diversity yields growth.
August 16, 2007... By Maria Varmazis Studies show a link to sales as well as savings. Anyone wondering about the business case for supplier diversity programs should talk to Joan Kerr. The executive director of supplier diversity at AT&T says that in...

LED prices expected to fall.(light emitting diode)
August 16, 2007... By James Carbone Overcapacity and stiff competition among suppliers will result in a 10-15% annual price drop for light emitting diodes (LEDs) over the next several years, although price erosion will be less for higher-end white LEDs. ...

Business Intelligence.(growth of electronics industry)(purchase orders got increased in electronics industry)(prices of semiconductor)(briefs)(Brief article)
August 16, 2007... By James Carbone 41% Electronics purchasers who say business is improving Source: www.purchasingdata.com WHAT IT MEANS : End equipment demand will be healthy, but it won't be strong enough to result in any component shortages....

Electronic Briefs.(ON Semiconductor L.L.C. expands)(agreements of Digi-Key Corp. and Amprobe Test Tools)(Brief article)
August 16, 2007... By James Carbone ON Semiconductor expands in the Philippines ON Semiconductor, a global supplier of power management chips, has announced the expansion of its production facility in the Philippines. Construction of an additional...

Stiff competition in China drives down cooling fan prices.
August 16, 2007... By Gina Roos Average Prices for cooling fans used in consumer electronics products, ranging from desktop computers to personal data assistants (PDAs), continue to fall as competition heats up from Chinese manufacturers, say thermal...

LCD price declines may be over, for now.(liquid crystal displays)(Brief article)
August 16, 2007... By James Carbone Prices for liquid crystal displays (LCDs) are rebounding in the second half of 2007 on strong demand, after a long steady price decline in late 2006 and early 2007. "Following weak pricing conditions in the fourth...

DRAM prices start to stabilize.(Statistical data)
August 16, 2007... By James Carbone The Dram price freefall appears to have bottomed out as prices increased in July. However, further price erosion can not be ruled out because of high inventory levels. DRAM prices started to recover in July after...

Asia's semiconductor market share grows.(Brief article)(Statistical data)
August 16, 2007... By James Carbone The share of the global integrated circuit market held by companies headquartered in the Asia-Pacific region is steadily rising, according to a new report by researcher IC Insights. The Asia-Pacific IC supplier segment...

Prices.(Statistical table)
August 16, 2007... By Staff Oil volatility has buyers eyeing energy pri- ces (Buyers' price expectations, 90 days) -------------------------------------------- UP DOWN SAME INDEX Energy 66% 10% 24% 78.1...

Chip Prices will Rebound.(Brief article)
August 16, 2007... By Staff After plummeting for much of 2007, chip prices are expected to rally in the third and fourth quarter. Yeongho Kang, vice president of Samsung's chip division expects prices of NAND flash memory chips to grow in the third quarter....

Box Price Hike Proposed.(Weyerhaeuser Co.; Packaging Corp. of America)(Brief article)
August 16, 2007... By Staff Weyerhaeuser and Packaging Corp. of America plan to boost prices of corrugated boxes by 8% on the East Coast and 10% on the West Coast. They have joined other firms already in planning to hike prices of both linerboard and...

Office Paper Prices Up.(Brief article)
August 16, 2007... By Staff The market-price average of $998 per ton in July for cut-size office paper indicates that most buyers have accepted the $60/ton price increase the industry has been proposing since early spring. Behind the increase is the rising...

Copper Price to Rise.(Brief article)
August 16, 2007... By Staff ABN Amro metals analysts believe the second half of 2007 could be a period of moderating commodity prices, but still sees global copper prices averaging $3.26/lb this year, up from $3.05 in 2006. "Copper cathode has benefited from...

Uranium Price Off Peak.(Statistical data)
August 16, 2007... By Staff The U.S. energy Department's decision to sell uranium from stockpile dampened prices to $120/lb at the end of July, down from a record high of $136 earlier in the month. Uranium prices had been climbing virtually nonstop since...

Toshiba Reviews NAND Tags.(Brief article)
August 16, 2007... By Staff The average price of Toshiba's NAND-type flash memory remained level in the second quarter compared to the previous quarter. As a result, Toshiba said it may revise its expectation for a 50% annual fall in prices of NAND for the...

FedEx Cuts Surcharge.(Brief article)
August 16, 2007... By Staff LTL carrier FedEx Freight in July reduced its current LTL fuel surcharge by 25% effective immediately. The news brought hope that other carriers might follow suit. UPS' CFO said the package giant is currently reviewing its LTL...

Producer Prices Fall.(Brief article)
August 16, 2007... By Staff The U. S. labor Department said its producer price index fell 0.2% after a 0.9% May increase. David Kelly, an economist with Putnam Investments in Boston, said the June report should ease concern about the possibility that rising...

No Letup for Rail Rates.(Norfolk Southern Corp.)(Brief article)
August 16, 2007... By Staff Railroad carrier norfolk Southern said it expects to increase its rates in the second half of 2007, depending on how the U.S. economy does. In a recent interview, Wick Moorman, CEO, said the rail carrier's prices were up at or...

Increase for Chip Capex.(Brief article)
August 16, 2007... By Staff Worldwide semiconductor capital equipment spending will rise only 2.7% to $43.1 billion. Strong 2006 capacity investments and high semiconductor inventories are leading to a slowdown in equipment demand, according to researcher...

DRAM Prices to Fall Again.(Brief article)(Statistical data)
August 16, 2007... By Staff Look for prices for DDR2 DRAMs to fall again. Prices fell about 70% from January to July, but then headed up in July. For instance, the contract price for a 512 megabyte DDR2 memory module increased 5% last month, according to...

Zinc Price Decline Seen.(Brief article)
August 16, 2007... By Staff With second-half production expected to expand, the world price of high-grade zinc may slide to $1.45/lb in the fourth quarter, down from a first-half average of $1.61, forecasts GFMS Metals Consulting in London. The...

Tin Price Stays Elevated.(Brief article)
August 16, 2007... By Staff With world tin prices averages rising from $5/lb in January to almost $7/lb in July, analyst Tim Huff at ABN AMRO has raised the brokerage's 2007 price forecast close to $6/lb. World tin averaged just under $4/lb in 2006. Also...

Signs That the Housing Market is Not Turning Around.(Brief article)
August 16, 2007... By Staff Existing home sales continue to decline Mortgage applications hit five-month low Mortgage originators have tightened underwriting standards in response to mounting defaults and foreclosures Mortgage giant Countrywide...

OPEC: Pumps Are Ready.(Brief article)
August 16, 2007... By Staff The new head of OPEC said the oil cartel is concerned that continued high oil prices will create a global recession and that it has more oil ready if demand outpaces supply. While he sees no clear indicators of such a recession,...

Suppliers Like GM More.(Brief article)
August 16, 2007... By Staff Suppliers are starting to warm up to GM, according to results of the 7th annual North American OEM-Tier 1 supplier working relations study. In late 2005, Bo Andersson, group vice president, global purchasing and supply chain,...

iPhone is Packed with Chips.(Brief article)
August 16, 2007... By Staff Apple's new iPhone has a hardware bill of materials totaling $265.83 according to a recent analysis from electronics industry researcher iSuppli. That means Apple has a margin in excess of 55% on each 8Gbyte iPhone model sold at...

China to Limit Exports.(Brief article)
August 16, 2007... By Staff In an effort to narrow its massive $112.5 billion trade surplus and reduce environmental damage, China announced in July it will curb exports of cheap labor-intensive products to force its manufacturers into focusing on...

China May Cut Copper.(Brief article)
August 16, 2007... By Staff Some of China's major copper smelters may cut production in the second half, not because of decreasing demand, but due to rising costs of raw materials and processing. Bloomberg reports that nine Chinese smelters discussed output...

Housing Slump Continues.(Brief article)
August 16, 2007... By Staff Sales of existing homes fell 3.8% in May, indicating that the current housing slump shows no sign of turning. "There's no evidence we've hit bottom yet,'' said James O'Sullivan, senior economist at UBS Securities.

Acetic Acid Tightens.(Brief article)
August 16, 2007... By Staff Celanese Corp. announced that it has extended its force majeure at a Texas acetic acid plant, which has been closed since mid-May due to a reactor leak The news tightens the U.S. acetic acid market further, as buyers begin to see...

Capacitors Harder to Source.(Brief article)
August 16, 2007... By Staff According to Purchasing's latest monthly buyer survey, prices for ceramic chip capacitors are on the rise. Almost one-quarter of buyers polled reported price hikes for the components in July, more than double the percentage that...

Heating Oil Supplies Tighten.(Brief article)
August 16, 2007... By Staff With so much attention focused on gasoline production, the U.S. heating oil inventories are down 40% from a year ago. "Recent months have seen a sharp decrease in heating oil production," said Sung Yoo, an energy strategist with...

Eastman Expands Capacity.
August 16, 2007... By Staff Eastman chemical said it is expanding its capacity for cellulose triacetate (CTA), citing increased demand from the liquid crystal display (LCD) market. Eastman did not say in a statement how much it would increase CTA capacity at...

CVC Capital Buys Univar.
August 16, 2007... By Staff CVC capital partners' offer for Univar could further consolidate a chemicals distribution industry that has seen its share of acquisitions lately. This latest move will enhance Univar's financial capability, says Gary Pruitt,...

Economy + Supply.(Statistical table)
August 16, 2007... By Staff Fabricated metals purchasing stays strong (Buyers' near-term buying plans) -------------------------------------------- UP DOWN SAME INDEX Fabricated metals 38% 16% 46% 60.9...

Leadtimes expand.(Brief article)
August 16, 2007... By Staff Thirty-Nine of 41 electronic component leadtimes tracked monthly by Purchasing stretched in July, indicating increased demand is making it more difficult for buyers to get electronic parts. The trend comes at the opening of the...

Electrolux designs a logistics network to support global sourcing.(Case study)
August 16, 2007... By David Hannon In the era of global supply chains, it is imperative the logistics and procurement organizations work more closely to support each other. Sourcing products in a low-cost region is useless if the logistics cost or process to...

Business Intelligence.
August 16, 2007... By Staff 60% Buyers expecting freight rate increases in the third quarter Source: www.purchasingdata.com WHAT IT MEANS: This is a big drop from the previous several months (68-70% range), indicating that buyers expect...

The Economics of Geography.(Brief article)
August 16, 2007... By Staff "In an era of just-in-time supply chains, proximity is everything." That's what UPS' CEO Mike Eskew told delegates at the U.S. Commerce Department's inaugural Americas Competitiveness Forum in Atlanta in June. Eskew said that...

Assured quality critical in global sourcing.
August 16, 2007... By Tom Stundza Sometimes a cost-benefit analysis will steer you away from suppliers in certain regions, says a veteran buyer. That's because the cost of quality for foreign-made parts may be the same or more than domestic supply. ...

Demand is off on automotive, manufacturing slump.(Statistical data)
August 16, 2007... By Tom Stundza Purchasing of Metal parts will drop by 7.5% this year to 17.2 million tons as increased production in aerospace and power generation markets is more than offset by reduced assembly of motor vehicles, appliances and certain...

Business Intelligence.
August 16, 2007... By Staff $4/lb 4Q copper price forecast Source: BaseMetals.com WHAT IT MEANS: "With all metals looking stronger and crude oil rallying, you have to wonder whether we are entering another concerted run-up in commodities,"...

Metals Chips.(Reliance Steel & Aluminum Co. to acquire Clayton Metals Inc.)(Klockner Namasco Corp. Namasco Div. acquired Primary Steel)(Red Man Pipe & Supply Co. to merge with McJunkin Corp)
August 16, 2007... By Staff Reliance Steel & Aluminum of Los Angeles, the second-largest metals service center in North America, is buying Clayton Metals of Wood Dale, Ill. Clayton specializes in the processing and distribution of aluminum, stainless steel...

Just-in-time model eliminates Posat Monroe Truck Equipment.(Monroe Truck Equipment manufacturing company)
August 16, 2007... By Staff Roger Schulz admits he's "hardly the first guy to go to a true just-in-time daily delivery" for manufacturing raw materials. However, the purchasing manager for the Snow and Ice Division of the Monroe Truck Equipment manufacturing...

RathGibson expands quality testing of specialty tubing.(Brief article)
August 16, 2007... By Staff Rathgibson of Janesville, Wis. has expanded production of precision-welded tubing in stainless steel, nickel, and titanium that are being marketed for use in the manufacture of high-purity nickel alloy heat exchangers, sub-sea...

Business Intelligence.
August 16, 2007... By Susan Avery $2.4T Spending by large companies on MRO in 2006 Source: Visa Commercial Consumption Expenditure Index WHAT IT MEANS: New analysis of the data by Visa shows that much of this spending is by manufacturers and is...

MRO buyers turn to distribution for lesson on Lean procurement.
August 16, 2007... By Susan Avery For MRO buyers, their distributor partners are often a good source for training on how to better manage inventory, apply product and technology and streamline the transaction process. Case in point: Consumers Interstate, a...

MRO Briefs.(Infor EAM Enterprise Edition)(Toyota Material Handling U.S.A.)(Unisource Worldwide Inc. plans to expand business)
August 16, 2007... By Susan Avery Toyota Material Handling U.S.A.'s new Toyota Fleet Solution , a lift truck management program, provides an enterprise view of lift truck procurement, use and service. The Toyota Fleet Solution centers around five major...

New Gexpro name may spell change for MRO purchasers.(GE Supply named as Gexpro)
August 16, 2007... By Susan Avery The name has changed from GE Supply to Gexpro, but the company's electrical distribution business has not-although the potential is there for it to grow stronger. So says Jeff Schaper, president and CEO of Gexpro in...

A take-charge approach worth imitating.(Six sigma approach at British Petroleum Company PLC; National Instruments Corp.)(Editorial)
August 16, 2007... By Paul Teague, Editor in Chief Farley Blackman is a guy who knows how to get things done. As the vice president of indirect procurement and Six Sigma at UK-based BP, he manages the company's $8 billion spend on facilities, travel,...

What to look for in online office supply catalogs.
August 16, 2007... By Maria Varmazis Most buyers know the benefits of buying office supplies online firsthand-it's faster and more efficient to buy products online and it's easier to track spend. Corporate Express says 80% of its transactions come through...

Business Intelligence.(investment on documents)(Microsoft Corp. shipments data)(color copiers growth)(briefs)(Brief article)
August 16, 2007... By Staff 2-3% Annual revenues spent on document-related expenses Source: InfoTrends WHAT IT MEANS: Some companies need to pay more attention to office and document management budgets in order to alleviate bottom-line cost...

Purchasing squeezes more value from p-cards.
August 16, 2007... By Susan Avery The industry is maturing, but that doesn't mean there isn't room to grow. P-card providers are responding to purchasers' expanding programs with additional resources and new tools that offer more control and payment options....

In-country supply managers go to great lengths to ensure best-quality materials.
August 16, 2007... By Tom Stundza In-country supply managers go to great lengths to ensure best-quality materials A regional director of sourcing for Jakel has been known to check the quality of key materials by traveling to suppliers' operations by...

Pop Quiz: How would your suppliers grade you? Ask them.
August 16, 2007... By David Hannon Leading-edge procurement organizations flip supplier scorecards and ask suppliers to rate them as a customer. The results can be surprising. The idea of supplier scorecarding is certainly nothing new, as purchasing...

Buyers scope out capital spending plans.
August 16, 2007... By James Carbone It's often said that it takes money to make money. That's true in the semiconductor industry where suppliers that invest the most in technology and capital equipment often end up being the most successful. ...

Texas Instruments trains buyers on global negotiating skills.
August 16, 2007... By William Atkinson Most U.S. procurement organizations are skilled and experienced in negotiating with suppliers and managing the resulting relationships-as long as the suppliers are in the U.S. Negotiating with suppliers in various...

Business Intelligence.(supplier delivery index remained even)(companies with customer demand)(briefs)(Brief article)
August 16, 2007... By Staff 68% Buyers reporting supplier on-time performance is even Source: www.purchasingdata.com What It Means: That's the exact same percentage as the month before and the overall supplier delivery index remained steady at...

Diamond Foods' procurement works to meet the consumer market needs.(Case study)
August 16, 2007... By Wayne Forrest Buying materials for a food and beverage company requires a bit more agility than buying at another type of company. Consumer's quirky tastes change very quickly and the purchasing organization at a food company needs to...

Purchasing execs on the move.
August 16, 2007... By Staff Campbell named CPO at Reed Elsevier Reed Elsevier, parent company of Purchasing, has named Leslie Campbell as its first chief procurement officer. Campbell will come to the post from her role as vice president of worldwide...

MeadWestvaco leverages market intelligence for procurement.(Case study)
August 16, 2007... By William Atkinson There was a time when the term "market intelligence" was limited to the sales and marketing departments or "C" level executives. These days, though, procurement departments are finding value in having access to market...

How to bridge the business gap in Hungary.
August 16, 2007... By Maria Varmazis As more companies grow eager to reach Western European markets, they look east-but not to Asia, rather to suppliers in Central and Eastern Europe. As the global search for low-cost, highly skilled manufacturing...

All worked up about biofuel.(Letter to the editor)
August 16, 2007... By Staff Can't Make Sense of Corn Regarding "oil prices at $80 proposed" (Price & Supply Alert e-newsletter, July 3, 2007), to me, corn-based fuels make very little sense. To grow corn successfully you need a lot of water-I have read...