Purchasing articles from May 2008

Purchasing archives from May 2008

How to choose a single-source strategy.(National Rural Electric Cooperative Association)(Brief article)
May 8, 2008... Staff Purchasing's smartest negotiators move from conflict to collaboration fast. Match your wits against these pros. Guess their strategy. Then, read what they really did at purchasing.com/negotiations. The national rural Electric...

The bucks start here.
May 8, 2008... By Paul E. Teague While finding total cost savings remains the primary goal of Hilton's purchasing organization, the 147-strong group has also found ways to bring in revenue for the company. Here is how they do it. Gazing at their...

Continued demand outweighs cost challeges.(Industry overview)
May 8, 2008... By Susan Avery Despite a slowing U.S. economy and rising costs, the chemical distribution industry reports strong demand and is as competitive as ever. And that's good news for chemical buyers. Strong is the word chemical distributors...

Currency issues have dyes and pigments buyers seeing red.
May 8, 2008... By Gordon Graff Pigment and dye prices continue their upward march as global producers try to stay afloat amid rising raw materials and energy costs. But buyers say the rates of price increase have slackened somewhat in the past year due...

Global chemical purchasing conference scheduled for September in Boston.(Conference notes)
May 8, 2008... Staff Information to help purchasing and supply chain managers prepare for the 2009-2010 global economy, energy feedstocks and key chemical families will be presented at the Chemical Purchasing Summit in Boston on Sept. 17-18. The two-day...

Business Intelligence.(Brief article)
May 8, 2008... Staff 20% Global annual demand for biofuels through 2011 Source: Freedonia Group WHAT IT MEANS: Global growth is driven by North American demand where the farm lobby is especially powerful, driving increased demand in...

Soft demand puts the brakes on polypropylene price hikes.
May 8, 2008... By Gordon Graff Prices of propylene and polypropylene have been following crude oil prices upward in the past few months, but a slowing demand for plastics has kept price increases to a minimum. Putting the brakes on polypropylene price...

LyondellBasell shuts Texas refinery, buys French one.(Brief article)
May 8, 2008... Staff Newly combined petrochemical giant LyondellBasell said recently that it is performing unscheduled maintenance at a refinery in Houston. The fluid catalytic cracking unit (FCCU)'s first-stage compressor shut down in mid-March and...

Buyers: Product availability trumps price.(Survey)
May 8, 2008... By Susan Avery It's too early to call it a trend, but purchasing is shifting its view of distribution. Buyers now look to industrial distributors to provide a wealth of technical expertise, and they come down hard on those that don't...

Distributors' supply chain role grows.
May 8, 2008... By James Carbone Suppliers are relying on distributors more than ever to service North American OEMs and electronics manufacturing services providers. Distributors look for similar growth in Asia. North American sales growth of the Top...

Catalog distributors are thriving.
May 8, 2008... By James Carbone Catalog distributors have found success focusing on new product introductions and small production runs. Many electronics distributors are concerned what impact the economic slowdown will have on their businesses in...

Independents hope for rebound in 2008.(Industry overview)
May 8, 2008... By James Carbone Many independent distributors took it on the chin in 2007, because of falling chip prices. It was a rough year for many independent electronics distributors in 2007 as most of them were impacted by falling prices for...

Next stop for electronics could be Vietnam.(Industry overview)
May 8, 2008... By James Carbone Vietnam has low-cost labor, but it won't become a serious option for electronics manufacturing until it resolves its critical infrastructure problems. 'And it's one, two, three, what are we fighting for? Don't ask me,...

A good year for electronics distributors.
May 8, 2008... Staff Computer and interconnect sales were up in 2007, but semiconductor sales declined. Here is how the distribution industry looks, according to the latest Purchasing survey. Thanks to a 54% jump in computer sales and a 20% spike in...

NAND flash prices will fall because of oversupply.
May 8, 2008... By James Carbone Memory IC buyers can expect prices for NAND flash memory to fall through the year because of overcapacity and competition among suppliers to grow market share. In addition, demand for flash will be a little weaker than...

Business Intelligence.(Brief article)
May 8, 2008... By James Carbone 64% Electronics purchasers who say semiconductor prices are stable Source: www.purchasingdata.com WHAT IT MEANS: Weak first-quarter demand and ample supply means that chip prices are steady and will likely...

Chip resistor prices to stabilize.
May 8, 2008... By James Carbone Electronics buyers can expect plenty of chip resistor supply and stable chip resistor pricing this year. While some suppliers reported severe price erosion in 2007, pricing is expected to stabilize this year. 'The...

Chip stockpiles decline in first quarter.
May 8, 2008... By James Carbone The amount of surplus semiconductor inventory in the global electronics supply chain declined 14.6% from $3.4 billion in the fourth quarter of 2007 to $2.9 billion in the first quarter of 2008, according to researcher...

Electronics Briefs.(Plexus Corp. expands)(Digi-Key Corp. and MeshNetics into distribution agreement)(Tyco Electronics Corp. and All American Semiconductor Inc. renews their agreement)
May 8, 2008... By James Carbone Plexus expands its U.S. facilities Plexus Corp. says it will expand its North American manufacturing footprint. The electronics manufacturing services provider says it will relocate its San Jose, Calif. operation to a...

Memory drives chip equipment revenue.(Brief article)
May 8, 2008... By James Carbone Worldwide semiconductor capital equipment spending totaled $44.5 billion in 2007, a 5.9% increase from 2006 revenue of $42.1 billion, according to researcher Gartner, Inc. Analysts said capital equipment sales were...

Slowdown creates opportunities.(Industry overview)
May 8, 2008... By James Carbone The economic slowdown can be challenging for buyers, but it also offers opportunities, according to the CPO of high-tech giant IBM. John Paterson says the slowdown has created a buyer's market in certain instances and...

Economy + Supply.
May 8, 2008... Staff [TABLE OMITTED] WHAT'S AHEAD: A continuing slowdown in purchases of construction and agricultural machinery and a decline in demand for big trucks.

Economy may shrink in 1H08.(Brief article)
May 8, 2008... Staff Federal Reserve chairman Ben Bernanke told the congressional Joint Economic Committee in early April, 'It now appears likely that real gross domestic product will not grow much, if at all, over the first half of 2008 and could even...

Sensor market will grow.(Brief article)
May 8, 2008... Staff The worldwide image sensor market will increase by 10% to a record high of nearly $7.6 billion up from about $6.9 billion last year, according to researcher IC Insights. CMOS image sensor sales are forecast to rise 19% in 2008 to...

IMF downgrades forecast.(Brief article)
May 8, 2008... Staff The International Monetary Fund cut its forecast for global growth in 2008 to 3.7% growth and put the likelihood of a global recession at about 25%. As recently as January, IMF was forecasting 4.1% growth for the global economy. ...

U.S. high-tech loses jobs.(Brief article)
May 8, 2008... Staff The high-tech manufacturing industry in the U.S. shed 29,800 jobs in 2007, according to a recent report from the American Electronics Association, while the software services industry added 82,600 jobs in 2007. Overall, U.S....

NAND growth to slow.(Brief article)
May 8, 2008... Staff The slowdown in the economy will impact NAND flash memory sales. NAND is used heavily in consumer-electronics applications-including MP3 players, USB flash drives and digital still cameras. Spending growth on these items is expected...

Credit crisis not done.(Brief article)
May 8, 2008... Staff The CEO of Morgan Stanley said in April that the credit crisis in the U.S. is not over and as it spreads to commercial real estate, the 'markets will feel it.' The International Monetary Fund said the losses from the credit crunch...

Chipmakers see slowdown.(Brief article)
May 8, 2008... Staff Several semiconductor makers are reporting a sales decline for the first quarter and possibly beyond. AMD in April announced plans to cut 10% of its workforce after a first-quarter sales slump. Samsung said sales will increase 10%...

Small Biz not optimistic.(Brief article)
May 8, 2008... Staff The National Federation of Independent Business' Index of Small Business Optimism fell to a 28-year low in March, showing small businesses were cutting back spending to ride out a coming recession. One-quarter of small businesses...

OPEC: oil demand to drop.(Brief article)
May 8, 2008... Staff Market analyst Mohammad Alipour-Jeddi at the Organization of Petroleum Exporting Countries expects global demand for petroleum to weaken in coming months. In a speech to an International Monetary Fund gathering, Alipour-Jeddi says...

U.S. unemployment high.(Brief article)
May 8, 2008... Staff Payrolls for January and February were revised lower by a total of 67,000 and the unemployment rate shot up to 5.1%, the highest since September 2005. The economy has given up jobs every month since the start of the year and the...

Automotive demand down.(Brief article)
May 8, 2008... Staff High gas prices, low consumer confidence, a shaky economy, and the housing and credit crisis have car buyers holding on to their wallets, triggering the third year in a row of weaker auto sales. In fact, economists say that unless...

China's trade surplus dips.(Brief article)
May 8, 2008... Staff China's quarterly trade surplus shrank for the first time in three years in the beginning of 2008-to $41.42 billion-as its export shipments slowed to $305.9 billion and its import bill was boosted to $264.48 billion by higher...

787 delivery date slips again.(Brief article)
May 8, 2008... Staff Boeing announced another delivery delay for its 787 Dreamliner, leaving it 15 months behind its original schedule. Some work meant to be outsourced and done at suppliers' factories now is being shifted to the final assembly line....

RIO's 1Q coal output off.(Brief article)
May 8, 2008... Staff Mining giant RioTinto said its first-quarter production of coking coal fell 27% after weather disrupted supplies from its Australian mines. Rio declared force majeure on coal shipments from its Hail Creek mine in Queensland state for...

Polysilicon plant scrapped.(Brief article)
May 8, 2008... Staff Chinese firm Trina Solar said due to 'recent favorable changes in the polysilicon supply environment' it was canceling plans to build a $1 billion polysilicon plant that was expected to produce 10,000 metric tons of polysilicon, the...

Prices.(Brief article)
May 8, 2008... Staff [TABLE OMITTED] WHAT'S AHEAD: Buyers predict that all commodity groups tracked will increase this quarter. The transportation price expectation index is near an all-time high (93.8).

Scrap steel prices fly.(Brief article)
May 8, 2008... Staff Market analysts and buyers continue to warn that higher scrap steel price increases are going to have a serious impact on steel prices this year. 'I have never seen scrap prices so high in 20 years,' Gonzalo Urquijo, a member of the...

Sheet steel may drop in 2H.(Brief article)
May 8, 2008... Staff Some steel mills have announced June delivery hot-rolled sheet in coil prices as high as $1,000/ton, almost double the $544 price average of last December. However, analyst Michael Willemse at CIBC World continues to expect...

Benzene tags near high.
May 8, 2008... Staff Benzene prices increased in March to $3.77/gal, according to Purchasingdata.com, from a 13-month low of $3.36 in January because of expanding demand.

Platinum costs less.(Brief article)
May 8, 2008... Staff Platinum future prices for July delivery have slipped to $2,000/oz on the New York Mercantile Exchange from $2,100-plus in the March spot market, and could slip more. Analysts say a 66% price gain from last August will cause makers...

Wire-rod price skyrockets.(Brief article)
May 8, 2008... Staff Steel wire-rod producers boosted list prices by $175/ton to $925 for June deliveries despite criticism from end-use buyers. The mill price of $750 for May transactions was slightly higher than the market was accepting at...

Cobalt prices rise.(Brief article)
May 8, 2008... Staff Spot cobalt prices averaged $49/lb in the U.S. market in the first quarter, reflecting the projected 10-20% increase in global demand-especially from aerospace markets-and virtually no growth in output. Cobalt cost U.S. buyers an...

DRAM makers push prices.(Brief article)
May 8, 2008... Staff DRAM makers Elpida Memory and Samsung plan to raise prices for DRAM memory chips as much as 20% in negotiations with major PC makers, despite reports from analysts that memory chips are still in oversupply. Elpida said it plans to...

Passives prices will be steady.(Survey)(Brief article)
May 8, 2008... Staff Buyers say that passive component prices will be steady this quarter. A survey by Purchasing finds that 69% of electronics buyers expect passive prices will be stable over the next 90 days. But passive suppliers have said prices will...

Coal to stay up.(Brief article)
May 8, 2008... Staff U.S. coal miner Massey Energy says coal prices will average $61-63/ton this year, up $8 from its prior forecast. Massey says coal prices will stay high enough to allow it to spend an extra $90 million on mining expansion this year,...

Citigroup ups metals, oil.(Brief article)
May 8, 2008... Staff Citigroup has boosted its price forecast for crude oil and a host of metals, citing increased investor participation in the commodity markets in the wake of a slowing economy. Citigroup said oil prices will average $96/barrel in 2008...

EIA: Oil will stay above $100.(Brief article)
May 8, 2008... Staff For the first time ever, the Energy Department's Energy Information Administration, issued a forecast in April that says oil prices will average more than $100/barrel for 2008. According to a revised forecast issued today in its...

Truck rates to stay low longer.(Brief article)
May 8, 2008... Staff Credit Suisse analyst Jason H. Seidl said the slow economy continues to plague truckers with low demand and high fuel prices. As a result, Seidl said trucking rates could stay low well into 2009.

Import prices rise.(Brief article)
May 8, 2008... Staff Foreign supply is no longer a bargain: A government report on import prices shows that the cost of foreign goods rose 2.8% in March. So, in the last 12 months, import prices are up nearly 15%, the highest year-over-year increase...

Copper above $3 this year.(Brief article)
May 8, 2008... Staff World copper prices will stay above $3/lb for the third consecutive year in 2008, says Roberto Souper, head of the sales at Chile's state-owned copper miner Corporacion Nacional del Cobre (Codelco), the world's largest copper...

'Green' procurement goes into the black.(Company overview)
May 8, 2008... By Maria Varmazis Saving trees is good, but for purchasing pros saving money is even better. Here is how three companies have found a positive return-on-investment for environmentally friendly purchasing. Not long ago when business...

Small distributors have big revenue growth.(URS Electronics)(Avnet Inc.)(Brief article)
May 8, 2008... Staff While distributor giants Arrow and Avnet are the leaders in sales in most products, smaller distributors enjoyed higher growth rates in 2007. URS Electronics in Portland, Ore., had the highest growth rate as it increased sales...

Perry Ellis brings freight rate auditing back in fashion.
May 8, 2008... By David Hannon When you're in line at the grocery store, do you watch the cashier ring up your items looking for overcharges or do you wait six months, then review the cash register tape for mistakes and go back to the store hoping...

Business Intelligence.
May 8, 2008... By David Hannon 21% YOY decline in BNSF's 1Q paper and lumber shipments Source: Bloomberg WHAT IT MEANS: The sluggish economy is hitting overall rail freight volumes in the U.S. But the declining dollar is increasing...

Railroads under more price-fixing fire as volumes continue to decline.
May 8, 2008... By David Hannon U.S. railroads came under more fire recently for alleged collusion to fix fuel-price surcharges as overall rail volumes declined slightly in the first quarter. Agricultural giant Archer Daniels Midland (ADM) filed a...

DOT officials: Mexican trucking pilot program is working.(Brief article)
May 8, 2008... By David Hannon At a speech in Colorado in March, U.S. Secretary of Transportation Mary Peters said the pilot program allowing Mexican trucks to cross the U.S. borders and U.S. trucks to cross into Mexico unfettered was making it easier to...

Buyers sourced record $61 billion in metals from distribution giants.
May 8, 2008... By Tom Stundza The biggest processing and distribution firms now control 43% of $143 billion metals supply network. Even though they bought substantially fewer tons in 2007, buyers spent an all-time high amount of money for steel and...

Rio Tinto economist sees China keeping commodity prices aloft.
May 8, 2008... By Tom Stundza Rio Tinto's chief economist, Vivek Tulpule, believes world prices for such commodities as copper and aluminum haven't yet reached their cyclical peaks. 'I think with copper prices and aluminum prices it is entirely possible...

Massey Energy boost capital spending, price forecasts.(Brief article)
May 8, 2008... By Tom Stundza Coal producer Massey Energy will increase spending in 2008 by $90 million on mining projects and expansions atop $220 million initially earmarked for new capacity this year. The company also plans to spend at least $220...

Explosive prices haunt buyer/supplier relationships.
May 8, 2008... By Tom Stundza Metals service center executives are as frustrated as buyers by the current metals marketplace. That's partly because of the tension that comes from the current spike in prices during a period of weak demand and partly...

Supplies short, prices high due to low manufacturing activity, soaring exports.
May 8, 2008... By Tom Stundza Ferrous scrap continues to be in short supply in the U.S. as steel mills scramble to acquire enough material to feed their operations in the face of growing export shipments. That's why shredded steel scrap, a favorite...

Persian Gulf sheet steel shortfall expected.(Brief article)
May 8, 2008... By Tom Stundza Nations in the Persian Gulf region could face an annual shortfall of 5.2 million metric tons of sheet steel products through 2010, according to a Gulf Organization for Industrial Consulting (GOIC) report quoted in the Gulf...

Business Intelligence.(Brief article)
May 8, 2008... By Tom Stundza $880/ton New price sought for rebar Source: Rocky Mountain Steel WHAT IT MEANS: Evraz-owned coiled rebar producer Rocky Mountain Steel boosted May-delivery list price by $176/ton but the action puts its...

Metals Chips.(metal industries acquisitions)
May 8, 2008... By Tom Stundza Los Angeles-based Reliance Steel & Aluminum , North America's largest service center company, has acquired Dynamic Metals International, a specialty metals distributor in Bristol, Conn. Dynamic will operate as a subsidiary...

Analyst says global billet and rebar prices heading for slide.
May 8, 2008... By Tom Stundza The rebar contract being traded since last October on the Dubai Gold and Commodities Exchange has been slow in developing. The New York Mercantile Exchange plan to launch a sheet steel futures contract within the next six...

Global production fell 2.9% in 2007.(Industry overview)(Brief article)
May 8, 2008... By Tom Stundza Global stainless steel production was 27.6 million metric tons in 2007, a decline of 2.9% compared to 2006, according to International Stainless Steel Forum (ISSF) data. The decrease in production occurred in most stainless...

GFMS: Prices to pass $1,000/oz this year even if demand drops.
May 8, 2008... By Tom Stundza The short-term price of gold may exceed $1,000/oz this year or early 2009, suggests the London-based consultancy group GFMS in its latest survey of the gold market. This probably isn't much of a stretch since the spot gold...

Fulton Supply president offers ways to cut costs in new book.
May 8, 2008... By Susan Avery Joel Roth wants to talk about MRO. Looking to open up discussion between purchasing and distribution, the president of Fulton Supply Co. in Atlanta, has written a book based on his experience in the industrial...

Business Intelligence.(Brief article)
May 8, 2008... By Susan Avery 40K Safety products in new MSC catalog Source: www.mscdirect.com WHAT IT MEANS: A 50% increase in SKUs (stock keeping units) since the industrial distributor's 2005 catalog. 3.2 Leadtime (in weeks)...

E-auction tool helps Blue Bird develop strategic suppliers.(Brief article)
May 8, 2008... By Susan Avery 'Clearly our strategy is to build relationships with suppliers,' says Bob Marshall, vice president of purchasing at Blue Bird Corp. in Fort Valley, Ga. To that end, he is using an e-auction tool to help consolidate the...

MRO Briefs.(American Express Co. acquires GE Corporate Payment Services)(James T. Ryan promoted as chief executive officer at W.W. Grainger Inc.)(Graybar introduces catalog)(Brief article)
May 8, 2008... Staff Purchasing wants to honor MRO purchasing pros by awarding them with a spot on its All-Star MRO Buy Team for 2008. Nominate MRO buyers who demonstrate excellence at managing relationships with suppliers or have come up with innovative...

Why go 'Green?' Because it adds efficiency.
May 8, 2008... By Paul Teague, Editor in Chief I recently attended an alumni event at my college alma mater and got into a conversation on environmental issues with an old classmate who now works in social services for a nonprofit agency. It was a brief...

How to collaborate with IT on office purchases.
May 8, 2008... By Maria Varmazis If there's one thing that gets IT managers really aggravated about technology procurement, it's being left out of the picture. Often enough buyers realize that major technology purchases-like data centers or large...

Business Intelligence.
May 8, 2008... By Maria Varmazis 45% Amount of workers' print that gets thrown out within a day Source: Xerox study WHAT IT MEANS: As offices try to go Green, one of the main areas of waste is paper. Prices for paper are volatile, so big...

Weak dollar and machine problems add to paper product price woes.(Brief article)
May 8, 2008... By Maria Varmazis Office paper prices show no sign of heading down after buyers on Purchasingdata.com reported paying an average record-high price of $1,100/net ton for cut-size office paper in March. This price is 38% higher than what...

2007 North American Rankings.
May 8, 2008... Staff [TABLE OMITTED]

Online tools provide travel buyers a new level of travel spend visibility.
May 8, 2008... By David Hannon What gets measured gets improved and perhaps no one can testify to that fact better than your company's travel manager. Gaining visibility into a company's travel spend can bring a host of previously unseen (and often...

12 steps to more effective supplier relationships.
May 8, 2008... By William Atkinson Honesty is the best policy-for supplier management. At least, that's the thinking of Patrick Bliss, director of purchasing for educational programs and services firm Apollo Group in Phoenix. If you offer trust and...

Business Intelligence.
May 8, 2008... Staff 18% Buyers increasing overseas sourcing in March Source: www.purchasingdata.com WHAT IT MEANS: That's a decline from the month before, indicating more buyers are sourcing close to home, as the value of the dollar has...

Dell to close Texas plant, outsource more manufacturing to EMS firms.(Brief article)
May 8, 2008... By David Hannon PC maker Dell said in April it will close one of its two Austin, Texas manufacturing plants and plans to outsource more manufacturing to contract manufacturers in low-cost regions as part of a broader $3 billion...

Coors mixes indirect spend into its procurement transformation.
May 8, 2008... By William Atkinson When Coors Brewing Co. embarked on its strategic sourcing transformation journey six years ago, the Golden, Colo.-based company introduced three new procurement and supply chain processes to drive the efforts: a...

U.S. airlines hit rock bottom in latest service rankings.(Brief article)
May 8, 2008... By David Hannon Travel buyers take note: the average service performance of the 16 U.S. airlines hit a new low in 2007 according to a recent study and the outlook is for more stormy skies. According to the 18th annual national Airline...