November 2013

By all objective measures, Beaujolais Nouveau wine is terrible.  It has a less than favorable reputation in France and among fine-wine enthusiasts, who liken its quality to that of a certain brand of box wines popular with the collegiate crowd. Unlike other famous French varietals which improve with age, this wine does not. But every year 49 Million liters, about 65 Million bottles, of Beaujolais Nouveau are produced and sold in the short 6-8 week period. Half remains in France with the other half being exported to Japan, Germany and the U.S. where it has enjoyed popularity as a Thanksgiving wine due to the proximity of the holiday to the wines release date.

So how does a young, tannis-lacking wine, with virtually no shelf life, everything a fine wine is not, become one of France's greatest exports? Its simple: clever marketing.  Every year around the holiday season, on what has become Beaujolais Nouveau Day, Beaujolais Nouveau wine is hastily shipped by plane, just a few weeks after harvest and production, to markets all across the world to be sold exactly at 12:01 AM on November 21st. Despite this being a wine of less-than-excellent quality, clever marketing schemes in the 60's and 70's played on the growing popularity of the product by highlighting the rush to export the wine all over the world.

The quick turnaround time, roughly 6-8 weeks, has also played a role in the marketing success of this wine. After all, something being done with so much urgency certainly has to be an indicator of importance, at least it would seem that way to your average consumer. About one-third of the wine produced in the Beaujolais Region, just North of the city of Lyon in the Eastern part of France, is Beaujolais Nouveau wine.  Every year wineries producing this varietal will export about 47% of their harvest, generally making this the largest proportion of their wine exports. Beaujolais is a red wine made from hand-picked Gamay grapes, that is fermented for only a few short weeks before it is ready to drink. Unlike Premier Cru's and other famous French varietals which improve with age, this wine is intended to be consumed immediately and has little to no shelf life. 

As with anything the quicker the production, the greater the profit. Vigneron Georges Duboeuf, recognized this income potential and began staging an annual race to Paris among the regional producers to draw further attention to the Beaujolais Nouveau.  The race has become an unofficial national event drawing large crowds who come to see over one million cases of the wine being transported to Paris by motorcycle, hot-air balloons, rickshaws and even an elephant. The plan was so successful that the French Newspaper, Le Figaro, called the export race "the greatest marketing stroke since the end of World War Two", and the numbers back this up.
Successful marketing campaigns are dependent upon a few key factors - opportunity identification, the creation of new and attractive solutions, and the ultimate delivery of a product or service.  As exemplified by the Beaujolais Nouveau wine, a well developed marketing campaign  that takes into account all of these factors can sell almost any product.  If clever marketing can sell bad wine, imagine what it can do for products and services that are actually good.

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Manufacturers moving toward green chemistry to lower chemical exposure

Common consumer products - from laundry soap to cleaning products - are made through chemical materials and processes. However, many consumers are unaware of the potential hazards these chemicals may pose to their health. A growing trend in the manufacturing and retail industries involves informing customers about the materials in their products, and even taking one step further to reduce chemical exposure by eliminating hazardous chemicals, according to Green Biz.

One of the ways manufacturers can help lower people's exposure to harmful chemicals or substances found in everyday items is by incorporating green chemistry. Green chemistry is defined as designing chemical products and processes that will phase out or remove hazardous substances, according to the Environmental Protection Agency (EPA).

Health effects of hazardous chemicals

Hazardous chemicals can also generate potentially harmful fumes, including volatile organic compounds. Also known as VOCs, these gases can be emitted from a large number of items, including paints and lacquers, building materials and even office equipment like copiers. When VOCs are released into the air, they can affect the quality of the air, especially indoor air as concentrations of VOCs can reach up to 10 times higher indoors than out, according to the EPA.

Building occupants exposed to VOCs could experience long term health effects. These effects can range from eye, nose and throat irritation to damage to vital organ systems like the liver and kidneys. As chemicals can affect the health of those who handle them on a daily basis, both the public and private sectors are working together to eliminate potential chemical hazards.

The Occupational Safety and Health Administration (OSHA) recently released a toolkit for employers to find ways to substitute or eliminate the use of harmful substances.

"Considering safer alternatives to hazardous chemicals is not a new approach," OSHA said. "Thinking about safer alternatives allows employers, workers, and decision-makers to identify solutions, rather than continuing to evaluate and quantify the problem. This approach can reduce costs and keep businesses competitive."

Green chemistry market to grow to $98.5 billion

In a study cited by the EPA and conducted by Pike Research, green chemistry has the potential to save industries $65.5 billion by 2020. The study showed manufacturers can reduce manufacturing costs by incorporating safer chemicals in their products and processes. Alternatives to standard petroleum-based feedstocks can include renewable sources, which can be produced from wood, agricultural waste or other materials. The study found sustainable sourcing from these materials can be done at a lower cost than petroleum products.

In addition to cost savings, manufacturers can also benefit from shrinking their environmental footprint. Hazardous chemicals can also generate greenhouse gas emissions as well as reach toxic levels. Companies that are committed to corporate responsibility in raising environmental awareness and increasing their sustainability should consider switching to green chemicals.

"The worldwide chemical industry is valued at around $4 trillion, so even small improvements in efficiency can have very large impacts," said Mackinnon Lawrence, senior analyst at Pike Research. "Just by bringing laggard companies up to the baseline standard of the industry as a whole, it's possible to capture more than $40 billion in cost savings and avoided liabilities."

The green chemistry market is projected to expand to $98.5 billion by 2020 from just $2.8 billion in 2011, according to Pike Research. The shift from hazardous to green chemicals is approaching quickly as government entities such as the state of California have introduced laws that require manufacturers to find safer alternatives and processes. According to Green Biz, businesses are also taking on more responsibility to eliminate hazardous chemicals. For example, Walmart recently called for informed substitution as consumers are becoming more concerned about the effects of the products the retailer sells.

Hospital energy efficiency a growing priority

While hospitals are bracing for the financial impacts of the Affordable Care Act, they might find themselves re-evaluating their budgets. Energy costs - a sizeable part of any hospital's expenses - can often be significantly reduced in order to reinvest cost savings back into their organization.

Hospitals could save $740 million in energy costs each year if they boosted their energy efficiency by 10 percent, according to the Environmental Protection Agency.

Using energy more efficiently is cost effective

To help achieve these cost savings, Energy Star revealed tools to measure building performance and reduce energy consumption. As a major consumer of electricity, Connecticut's Greenwich Hospital contributes to the $8.8 billion spent nationally on energy costs per year by U.S. health care facilities, according to Green Biz. Using Energy Star's rating, the Greenwich Hospital scored 47, which is 28 points away from receiving an Energy Star Designation. However, after working to improve its energy efficiency initiatives, the hospital was able to save $303,000 on electricity and more than 1.7 million kilowatt hours per year to earn a rating of 88.

Through boosting energy efficiency by 10 percent, hospitals could save 7.3 billion kilowatt hours of electricity - cutting the same amount of greenhouse gas emissions generated from over 712,000 homes, according to the EPA.

Energy efficiency through policy change

In an interview with Health Facilities Management Magazine, National Program Manager for Energy Star Commercial Buildings Clark Reed told the magazine hospitals are likely to see energy efficiency as a growing priority. He said there are three main factors that contribute to this: declining Medicare reimbursements, increasing energy costs nationally and a growing desire for hospitals to become more sustainable overall.

Reed suggests that implementing more sustainability initiatives in hospitals can start with institutional and policy changes. Executive leaders can create written policy changes to save energy and designate duties surrounding energy saving initiatives to staff, including an energy director if they choose, to keep their energy conservation efforts geared for the long run. Recording a benchmark for energy usage to help set goals and determine where they stand among the competition calling for the need for energy audits is also an option.

"For instance, benchmarking against the industry can provide key insights into the competitive use of energy," Reed told Health Facilities Management Magazine. "A hospital may learn that it's using more energy than average and set an initial goal of becoming average. Then, when that is reached, strive to become best-in-class by performing in the top 25 percentile nationally."

Achieving cost savings goals

Reed believes energy reports are key in keeping hospitals committed to their energy saving goals, whether they are in the form of monthly, quarterly or annual reports. As workers are provided with incentives to save energy or have their performance evaluated based on energy saved, the organization is likely to benefit from internalizing their sustainability goals.

In addition to changes within the staff and hospital policy, health systems can invest in new energy efficient equipment for retrofitting, including lighting. Reed said manufacturers are enhancing the performance of light emitting diodes (LEDs) to become more efficient while also developing them to become more versatile to be used in any hospital setting.

Retrofitting can result in a significant impact to cost savings for hospitals, according to a guide written by the National Renewable Energy Laboratory and the Rocky Mountain Institute. The guide suggests that hospitals look into retrofitting multiple pieces of equipment or building components instead of individually in order to reap the most energy savings. By seeing how retrofits combine to accumulate energy savings, hospitals can decide how to best approach retrofitting.

Ford planning $150 million investment for metal stamping plant

Ford will put $150 million toward its metal stamping plant in Buffalo, N.Y., to increase its manufacturing capacity, according to the Detroit Free Press.

The auto manufacturer is expected to generate 350 jobs at the plant to develop metal parts for vehicles. These new workers, who will mostly be working entry-level jobs, will join a current workforce of 650. The stamping plant is expected to create supplies that will eventually be used for auto assembly at a factory in Oakville, Ontario, where different Ford models are manufactured including the Ford Edge and other vehicle models.

"We produce crucial components for several key vehicles in Buffalo," said Paul Kosaian, Ford director of manufacturing for stamping operations, according to the Detroit Free Press. "With the help of our [United Auto Workers] and government partners, we were able to secure additional jobs and keep Buffalo stamping competitive."

As a sign that domestic manufacturing in the auto industry is strengthening, Ford has a goal of adding 12,000 hourly jobs by 2015 and has met 75 percent of this target so far, according to the Detroit Free Press. Jimmy Settles, UAW vice president for the National Ford Department, said the stamping plant is expected to exhibit workers' commitment to operational excellence.

Strategies for expanding manufacturing capacity

Ford is following one strategy as described in Forbes: increasing production capacity. By increasing its capacity, the auto maker has the ability to mitigate any bottlenecks, which may have included providing supplies to its assembly plant. In addition, Ford can invest more in its existing resources to help its employees produce more vehicle units.

"These additional jobs are the direct result of the dedicated effort our UAW members display every day at facilities all across the country, and serve as another reminder of the resilience of American workers and our nation's manufacturing sector," Settles said, according to the Detroit Free Press.

Another strategy companies can follow to reduce manufacturing costs while maintaining a high rate of productivity is transitioning to higher margin product lines. By choosing to produce products that have proven to be highly profitable, Ford can focus its resources on items it know it will sell in the market. Small business manufacturing companies can also adhere to this strategy as they grow their business without injecting more capital into their operations. If these strategies do not work, companies can also resort to having their current employees work overtime, though this may not be sustainable in the long run.

Digital advertising, the latest trend in marketing and advertising, is becoming the focus of organizations, especially how to best utilize social media. The desired communication format has shifted from email to social media and instant messaging, with a 20% decrease in email usage between 2008 and 2012. Despite this shift, email marketing campaigns are still accounting for higher click-through and conversation rates than social media campaigns. A recent study found that 75% of customers prefer email marketing campaigns to social media marketing. With all of the evidence pointing towards the importance of email marketing, how can organizations get the most out of their email campaigns and avoid ending up in the inbox trash can?

Some best practices to keep in mind when creating your email marketing campaign are having a clear and appealing message, customizing content, and utilizing analytics. Consumers are using their mobile devices to read emails more frequently than computers, making mobile web browsing compatibility all the more essential. It is estimated that about 60% of consumers will not return to a company's website, and 41% will go to a competitor's, if they are unable to open an organizations marketing email on their mobile device. Mobile device compatibility can help your organization to avoid losing vital customers and wasting money on emails that are purposefully being ignored because they cant be opened on a cell phone.

The communication between an organization's marketing departments is critical to the success of any type of marketing campaign, but email marketing requires more than your typical marketing department collaboration. During a recent webinar on the subject, Luke Glasner, an email marketing expert, emphasized the importance of integrating various aspects of an organization's supply chain in order to produce the most effective multichannel email marketing. The technology required to create mobile device compatible emails requires the integration of IT departments and technology experts. Measuring the success of a campaign and gathering data, such as click-through rates, requires data experts who have the means to process and understand this information. An organization's supply chain, including IT, analytics, marketing, and mobile, is critical to be able to launch a successful campaign that meets the growing demands of the market. Therefore, a successful email marketing campaign means an organization has to have the resources to back the project for it to reach its highest potential and reach that majority of customers who still prefer email to social media marketing.

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Major corporations form alliance to support bioplastics industry

Because the food and beverage industry is a major contributor of waste generated around the globe, leading companies are stepping up their green procurement efforts by forming a partnership to support the bioplastics industry. Large corporations are teaming up with the Wood Wildlife Fund (WWF) to form the Bioplastic Feedstock Alliance (BFA) to increase the development and use of plant-based plastics, Packaging Digest reported. This alliance includes top food and beverage producers, including Coca-Cola, Heinz and Nestle.

"Joining the alliance means we will be able to help build a more sustainable future for the bioplastics industry whilst addressing issues such as land use, food security and biodiversity," said Anne Roulin, Nestle's global research and development sustainability manager.

In 2011, 32 million tons of plastic were thrown away in landfills, according to the Environmental Protection Agency (EPA). Much of this plastic waste is in the form of containers and packaging - including disposable plastic for food products - which account for 14 million tons of U.S. waste.

Plant-based materials, such as those made from corn and grass, have long been touted as greener alternatives to conventional fuels and feedstocks. Plastics like polyethylene are usually made from petroleum-based feedstocks, and for the most part, they are not recycled, according to the EPA.

Reducing plastic waste with bioplastics

Out of the millions of tons of plastic waste created in 2011, only 8 percent of it was actually recycled. With this low recycling rate for regular plastics, bioplastics generated from plants are considered by those in the alliance to be more eco-friendly. Bioplastics have less of an impact on the environment not only from sourcing but also in the event they are thrown away since bioplastics can be manufactured to be biodegradable instead of remaining in landfills.

BFA aims to help companies transition to use bioplastics to replace typical plastics for packaging and other material. As consumers look for eco-friendly goods, companies may have to turn to sustainable sourcing in order to remain competitive with increasing demand for these type of products.

"This alliance will go a long way in ensuring the responsible management of natural resources used to meet the growing demand for bioplastics," said Erin Simon, of WWF. "Ensuring that our crops are used responsibly to create bioplastics is a critical conservation goal, especially as the global population is expected to grow rapidly through 2050."

Reduce manufacturing costs with increased energy savings

Producer prices for finished goods dipped 0.2 percent in October as raw material costs fell, Shopfloor reported.

The Bureau of Labor Statistics' (BLS) Producer Price Index report said this decline marks the second consecutive month producer prices for finished goods ticked -0.1 percent in September. Year-over-year, producer prices increased 0.3 percent in October, which is still lower than the annual rate of core inflation - remaining at 1.4 percent since September. With the latest report from BLS showing inflation as unchanged, this could show the Federal Reserve it could hold off on its plans to slow down government bond purchases, which serve to stimulate the economy and put downward pressure on interest rates.

While raw material costs decreased 0.7 percent in October, some segments reported rising prices year-over-year, according to the BLS. These sectors include the plastics and rubber industry with a 2.2 percent increase and leather and allied products with 3.5 percent.

Energy savings translate into lowered manufacturing costs

A major factor in the second straight drop in producer prices is lowered energy costs. The price of finished goods decreased 1.5 percent in October and gasoline prices declined 3.8 percent.

Companies that improve the energy efficiency of their operations can greatly reduce manufacturing costs. For example, the U.S. wood products industry reported a jump of 6.7 percent in raw materials costs year-over-year, however, companies in this sector could cut their overall business costs by implementing energy conservation and efficiency initiatives.

Canadian wood products manufacturer Tolko Industries, maker of lumber, paper and other goods, developed a plan to save on energy costs, which included hiring an energy manager, the Vancouver Sun reported.

"In the wood products industry, you're making a lot of commodity products," Towers told the Vancouver Sun. "You're taking the price of the market for your products, so the way to be more competitive is to reduce manufacturing costs."

Tolko Industries replaced older machinery with more energy efficient ones as part of the company's project to boost energy savings, which amounted to over $500,000 after cutting its energy usage by 10 gigawatt hours annually.

"It's very helpful to have someone in place who can identify opportunities, monitor and report energy use, and share best practices between operating facilities," Towers said. "Having an energy manager ensures we have a robust program and allows our managers and employees to focus on running the day-to-day business operations."

Textile and apparel industry commits to sustainable sourcing through lifecycle analysis

Consumer attitudes about the materials and ingredients in products they buy are rapidly changing, shifting toward products that are ethically or sustainably sourced - and clothing is no different. Recently, the 2013 Textile Sustainability Conference put the focus on the challenges businesses in the textile and apparel industry have in making their products more sustainable in addressing consumer concerns, Green Biz reported.

In facing increased product sustainability obstacles, the industry has adopted lifecycle analysis (LCA) to measure the impact of all the materials and processes used for clothing, including raw materials to manufacture products, packaging and transportation of goods.

"The industry is addressing fast fashion and moving toward a closed loop where end of use does not mean the end of life," said Tricia Carey, vice chairperson of Textile Exchange. "But the biggest challenge is educating the consumer to decide about their purchases not by price, but by the environmental impact."

Analytical tools like LCA allow companies to collect data to prove to consumers sustainable sourcing had a hand in their manufacturing and other processes. But it's also important apparel and textile companies start from the bottom up to make sure they are optimizing the sustainability of their operations. Gathering information from suppliers is a crucial first step in ensuring the sustainability of the materials that make up their products, according to Apparel Magazine.

Recording environmental impacts

Leaders in this sector, including the Sustainable Apparel Coalition (SAC) and the Outdoor Industry Association (OIA), have recommended firms should concentrate on the sustainable sourcing of lower-tier suppliers in order to reduce the impact the textiles and apparel industry has on the environment.

Earlier this year in June, 22 of Britain's largest apparel retailers and other members involved in its apparel and textile industry agreed to record and report their environmental impacts, according to retailer eCouterre. The shops and organizations that have pledged to do their part for the Sustainable Clothing Action Plan 2020 include the Textile Recycling Association and the British Retail Consortium.

"We know that overall, clothing contributes around 5 percent of the carbon footprint and between 6 to 8 percent of the water footprint of all the UK's goods and services," said Liz Goodwin, chief executive of Waste and Resources Action Program. "It also accounts for more than 1 million tons of wasted materials, making it the most significant category for consumption impacts after food and drink, housing and transport."

The goal is for these organizations, which make up over one-third of clothing sales in the UK combined, is to reduce their environmental footprint by 2020, including their water consumption and carbon emissions.

Health care industry might struggle with LEED procurement

The U.S. Green Building Council (USGBC) announced the newest version of its green building rating and certification program has officially launched, according to Environmental Leader.

Known as Leadership in Energy and Environmental Design (LEED), this program aims to promote sustainable buildings while reducing energy consumption.

With the launch of LEED v4, there are now 122 beta projects globally that are incorporating this latest version. In the updates to the rating system with LEED v4, new sectors are included in the program, including data centers and buildings in the hospitality industry. USGBC has also made it easier for designers and builders to become more informed about how their structures can become LEED certified with step-by-step guides and videos.

The new version of LEED is also expected to concentrate on outcomes, which could aid in energy and resource management of these buildings. While the impact of this program can be seen with energy savings for individual buildings, this rating system can also determine the sustainability of cities. In the latest rankings of the 10 smartest cities in North America, based on innovation and sustainability, No. 2 city San Francisco and No. 9 city Chicago were praised for their large number of LEED buildings, according to Fast Company. San Francisco had 302 LEED certified buildings while Chicago had even more with 405.

"LEED v4 is as much a testament to the achievements of LEED project teams around the world as it is to the green building community's ambition to create significant global and local change through resource-efficient, cost-effective green buildings," said Rick Fedrizzi, president and CEO of USGBC.

Health care sector challenges

Scot Horst, senior vice president of LEED at USGBC​, said the market can benefit from cleaner and healthier buildings. Despite acknowledging the benefits of the green building rating system, some industries anticipate challenges regarding LEED procurement, including the health care sector, according to Healthcare Design Magazine.

"As much as the design industry likes innovation, it often does not embrace change quickly, especially in health care, given the long cycles of design and construction for large projects," said Mara Baum, senior associate and sustainable design leader for healthcare at HOK. "Many aspects of v4 are very new to the sustainable design community, so it will take time for the industry to adjust."

Health care sector buildings may have difficulties meeting new LEED v4 features such as increased water efficiency prerequisites and building product reporting, with some professionals even calling these new updates too ambitious.

Although the health care industry might be concerned with LEED v4's new requirements, hiring an experienced procurement consultant could help them meet their sustainable building goals.

The assembly line went from industrial novelty within the Ford plant to standard in a rather short amount of time. Since then, assembly line tactics have trickled into many other businesses, including fast food restaurants. Particularly McDonald's. Assembly line, mass produced food is so entrenched within the golden arches that their competitors actively trade on the fact that "special orders don't upset" them.

In this emerging era of consumer-accessible one-off manufacturing -- from moderately custom cell phones to sneakers designed to the particular foot -- it only follows that McDonald's would attempt to capitalize on this change. And of course, since we're talking about food preparation, this step forward could also be seen as a step backwards, to the days of food prepared fresh for the customer. But it's fast food, so this is progress.

According to an article in Bloomberg BusinessWeek, the fast food restaurant is testing a custom order system powered by an iPad. Customers are able to select from more than 20 topping & sauce varieties and, upon confirming the order, the hamburger is cooked to order. The move comes as the company works to improve its core business -- speedy service and affordable food -- with menu reductions and potential redesigned drive-thrus, and stands as a polar contrast. The custom hamburgers at McDonald's take longer to prepare and cost more than the company's signature Big Mac. McDonald's is seemingly willing to sacrifice speed and price if the custom product helps the company resonate with Millennials. Businesses across the industrial landscape are facing these decisions daily, as customization becomes a demanded option from an increasingly fickle and diverse consumer base.

So far, the custom hamburger ordering option is only being tested within one region within California and McDonald's has been quick to note that, even if it doesn't become a viable option to implement across its chain, the customer data it generates can be used to steer future products.
Consumers more concerned about food companies' ingredients

The food industry should be on the look out for a shift in the consumer product market for food as more customers become concerned about ingredients, Food Business News reported.

In response to the growing number of consumers and consumer advocate groups who are worried about the ingredients found in food and beverage company products, industry leaders are starting to take action in educating their customers.

Lori Colman, the co-chief executive officer of CBD Marketing, said 40 percent of the consumer population is concerned about food and 22 percent discuss topics on food.

"They are action oriented and they are out to impact the way food is raised, grown, packaged and sold," Colman said, according to Food Business News. "The group also generates 1.7 billion conversations about food each week."

Companies more aware of consumer food concerns

​Kantha Shelke, a principal at food science and research firm Corvus Blue, said consumer beliefs are changing the market. Shelke said food companies should evaluate how they inform their consumers about their ingredients. She said customers are highly interested in controlling what is in their food and in understanding what is in product ingredients.

Colman said companies need to know whether the ingredients they use might be harmful for consumers. This includes ingredients that may be prohibited in other countries or if they are known allergens.

The role of market research can also play an important part in determining whether customers are worried about the ingredients food and beverage companies may have incorporated into their products. A great source of information could be found on social media to know whether products are being discussed on this popular platform.

In addition to consumer hyper-awareness for ingredients, the food industry should also be aware of labeling challenges and potential lawsuits stemming from this issue, TheStreet reported.

Companies such as Monsanto and Kellogg are working to change food labeling laws as more food firms are being challenged in court over their labeling practices. A lawsuit against Campbell's involve products that are deemed "natural" when they may include ingredients that were genetically modified is one such case. While Campbell's has tried to have the lawsuit dismissed, U.S. District Court Judge William Dimitrouleas disagreed, saying the Food and Drug Administration and U.S.  Department of Agriculture were aware of Campbell's soup's genetically modified ingredients.

With consumers willing to challenge food companies in courts over their ingredients, firms are more likely to grow more careful regarding their sourcing practices.

String of food recalls leads to temporary plant shutdown

Food manufacturers must be careful when procuring product ingredients because suppliers may not be careful in assessing or preventing the risk of foodborne illness. However, manufacturers should also be aware of how their own facility may have an impact on the quality of their products before inferior products result in costly recalls or even in business interruptions. This is the case for Garden-Fresh Foods that announced it was closing a plant located in Milwaukee due to consecutive product recalls, The Associated Press reported.

Since the end of August, Garden-Fresh Foods has experienced eight recalls. The first was the result of an inspection by Michigan food safety officials who detected the presence of Listeria bacteria. This foodborne pathogen could cause severe or even fatal infections in people who are susceptible to these types of illnesses, including the elderly, children and pregnant women. Even healthy people may have symptoms of suffering from a foodborne illness such as high fever, nausea and abdominal pain.

Spokeswoman Mary Roberts said the plant will remain closed as the company handles multiple recalls and works to prevent the incident of contamination, according to the Journal Sentinel.

"We are working tirelessly to resolve the current issue and will make any changes necessary to ensure we are in compliance with food safety regulations and our own exacting standards for high quality," Roberts told the Journal Sentinel.

Recalls lead to business disruption

In one of the most recent recalls in early November, Garden-Fresh Foods had to recall a variety of products including vegetables, ready-to-eat salads and spreads, according to Food Safety News. Similar to the first recall on Aug. 30, these products were also found to have been contaminated with Listeria monocytogenes. These products were sold in at least 10 states across the nation. Other products that have been recalled by Garden-Fresh Foods include ready-to-eat chicken and ham products, Food Safety News reported.

In establishing a risk management process, companies should take into account what may happen in the event of risks such as product recalls. While the company copes with its multiple recalls, the company has reassigned almost 100 employees as the Milwaukee plant halts production.

"We are confident that we will be able to find the source of the issue and resume operations," Roberts said. "However, we will not reopen until we are 100 percent satisfied that we can produce and maintain the safest, highest quality products possible."

Biggest challenge for businesses: Incorporating sustainable business practices

When going through risk assessment procedures regarding environmental hazards, it's important to go one step further to ensure sustainable business practices. Incorporating sustainability was the top obstacle for businesses for the third year in a row with 62 percent of survey takers saying it was their biggest leadership challenge, according to the State of Sustainable Business Survey for 2013 conducted by BSR and GlobeScan. Sustainability professionals often find it difficult to change the attitudes of the company's leadership, such as by swaying their leaders to believe sustainability has a major impact.

"Convincing leadership of the value of integrating sustainability and changing management mentality are the most commonly mentioned barriers," the report stated. "This may be a result of other mentioned barriers, such as the difficulty in demonstrating the value of integrating sustainability, especially when there are financial constraints and where profit is prioritized over sustainability."

Harvard Business Review cautions businesses that they will have to eventually change the minds of their leaders in order for sustainability to grow on a larger scale. Leaders might see business as separate from nature, as social and ecological factors cannot be quantified as much as revenue and other concrete indications of business growth. To change this mindset, corporate sustainability leaders might have to use analytical tools and models along with contextual understanding to ensure sustainability initiatives are successful.

Achieving sustainability initiatives

Despite this challenge, some businesses have had successfully integrated sustainability within their business and its operations. In the survey, 53 percent of companies had moderate integration while 23 percent were able to achieve significant integration in 2013.

This year, companies were most likely to engage in supply management and workers' rights-related issues, especially those who live in developing countries. As for trends in sustainable business management for next year, companies predict that climate change and water management will have the biggest impacts.

Initiatives regarding sustainability have also had trouble engaging workers. In the area of corporate finance, 16 percent of respondents said they reach out to their co-workers about this. Despite this, there appears to be a high level of engagement with corporate communications with 75 percent of participants saying they interact with these workers involved in this type of function on a regular basis.

Harvard Business Revenue recommends companies ask themselves what insights and practices can galvanize engagement for sustainability not only within the company but also the industry. Companies could help increase efficiency and reduce the environmental footprint of their operations through sustainable sourcing, in the hope that other businesses in the industry will follow their example.

Nonprofits struggle with aid operations for typhoon disaster victims

As nonprofits and other organizations try to transport food and other supplies to the Philippines amid theTyphoon Haiyen​ devastation, many groups are struggling with distributing aid within the damaged archipelago's infrastructure.

The relationship between logistics and natural disasters is often complicated if infrastructure such as roads and airports are destroyed during severe weather events. This could slow down distribution of vital disaster relief, especially considering the damage and death Typhoon Haiyen has left in its wake.

The nation's government estimated there have been 2,300 deaths, with tolls expected to rise in areas such as Tacloban, according to Business Insider. The UN said up to 11 million people have been affected by the typhoon and approximately 600,000 have been displaced in the aftermath. The economic losses stemming from the disaster are approximately $15 billion, which is considered low because some of the poorest parts of the country were the worst hit.

Much of the infrastructure of these regions,  which were already remote to begin with, was demolished.

Disaster preparation crucial for supply delivery

The problems nonprofits face with disaster logistics are much different than typical business logistics, according to Ann Campbell, a professor of management sciences at the University of Iowa's Tippie College of Business. Campbell's research focuses on increasing efficiency for transporting supplies to disaster areas. Organizations need to take into account what resources or infrastructure might fail in the event of a disaster. Since road infrastructure might be damaged or destroyed after a disaster, organizations should try to communicate this information to supply vehicles.

"In a disaster, it is important to recognize that information on road conditions is slow to come in," Campbell said on the University of Iowa's site. "Also, cell phones usually don't work so it is important to give drivers as much information as possible before they leave the depot with supplies."

Procurement strategies for emergency preparedness are important in determining distribution of disaster relief supplies. As part of her research on disaster logistics, Campbell is studying where supply depots should be positioned before a storm hits.

"If you put them too close to the coast, for instance, they might be destroyed by the storm, so you have to put them someplace that's far enough away to be safe but no so far that it takes too long to get the supplies to the people who need them," she said.

Plastics industry expects drop in raw materials costs with shale production boom

As rapid production of domestic oil and natural gas increases the availability of feedstocks used in the manufacturing sector, this may change how companies strategize their procurement operations, according to National Geographic. In the International Energy Agency's recent World Energy Outlook, the organization expects key energy production trends to transform the energy landscape of the United States. In one of its predictions, the IEA said oil sales will stem from increased industrial and consumer demand for plastics, which are used to make a wide variety of goods such as smartphones.

A growing number of plastic industry leaders anticipate they will see revenue growth thanks to the recent boom in shale oil and gas production using hydraulic fracturing and horizontal drilling technologies, Plastics News reported.

"A few years ago, we said we expected industry growth to be in the Middle East or in emerging geographies," said Greg Jozwiak, commercial and business vice president at Dow Chemical. "But starting in 2008, things changed significantly. Now it's about how plastics can seize these opportunities."

Shale production means drop in plastic prices

Resin manufacturers are taking advantage of increased oil and gas output to boost their production capacity for ethane and ethylene, a crucial component for polyethylene and PVC plastics. He said oil and gas production will help the plastics industry grow through an increase in materials, processing and finished goods exports. Jozwiak also said plastics will see more hiring activity, according to Plastics News.

In addition to the 485,000 additional petrochemical jobs shale production is expected to generate, the plastics industry will benefit directly with 55,000 more resin production jobs and 10,000 new plastics manufacturing positions.

Berry Plastics, manufacturer of plastic packaging and other products, also predicts growth in the industry. Scott Farmer, executive vice president of global purchasing at Berry, described the shale boom as the most exciting occurrence the plastic industry has experienced. With the rise in oil and gas production causing a drop in PE prices, it means good news for plastics manufacturers that aim to use this material for their products. Berry predicts a 10 percent decline in PE prices could result in 5,500 more manufacturing jobs and boost PE demand by 800 million pounds per year, according to Plastics News.

"The people who drive the volume of plastic pellets are consumers," Farmer said. "We have to get the [resin] cost to the point where [the shale advantage] can be passed on to converters and on to their customers."

Pass the margarine—while you still can. Recent speculation by the FDA surrounding the banning of trans fats has many people enjoying their potential last moments with “original recipe” fried foods and cholesterol-raisers. Aside from different ingredients in some comfort food, a trans fat ban would offer some considerable savings for consumers in long-term healthcare and related costs, but the impact to the costs of foods that currently contain trans fats, as well as products that rely on the seed oils seen as replacements for trans fat-containing partially hydrogenated oils, is more uncertain. Whether this is indicative of government control is debatable—however the positive health impact is hard to argue. As for businesses, there are considerable savings through the use of alternative oils.
One option, tropical oils, offer similar tastes and textures when used in products, but come from plants. In particular, tropical palm oils (known as palmitic acid) are said to help lower cholesterol. Palm kernel oil, as of September 2013, was priced at $725.80 per metric ton, while margarine is about $1000/ton. Another option, coconut oil, would still provide savings as it is $985 per metric ton. A key reason trans fats were appealing to businesses was their preservative nature. Switching away will not compromise this trait, as coconut oil has a shelf life of at least two years and palm kernel oil is extremely stable as well.
Although many companies in the food industry have already altered their ingredients due to the concern of health officials, the change would not produce much recognizable difference in foods—to the extent that many consumers won’t even know the change occurred. Thanks to the Huffington Post article, “Will You Even Notice The Trans Fat Ban?”, Rachael Rettner observes the ease of this process due to how unnoticed getting rid of trans fat has been in the past.
Pulling these oils into the food industry could impact costs elsewhere, however, as other industries use of naturally derived oils. American industries go through hundreds of millions of tons of seed oils, 600-800 million pounds of castor oil in particular, annually. These oils, and their derivatives, are used in the manufacturing of soaps, lubricants, hydraulic and brake fluids, paints, dyes, coatings, inks, cold resistant plastics, waxes and polishes, nylon, pharmaceuticals, and perfumes. For businesses seeking naturally created oils, they may see an increase in their MRO spend as increased demand for these seed oils may limit available supply and raise costs.
This ban would lead to prevention of heart attacks and cardiovascular disease in mass amounts of people in America—where currently 36% of the population has the condition. There would be billions of dollars saved in health care and related costs. According to the Centers for Disease Control and Prevention, the direct and indirect costs of cardiovascular disease amount to an estimated $305 billion in the United States in 2009. If a nationwide ban on artificial trans fats reduced the costs of cardiovascular disease by only 10%, this would save $30 billion per year.

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I recently conducted a Request for Proposal (RFP) for a project that seemed pretty straight forward, however, everything that could possibly go wrong during a sourcing event went wrong! A lot of time, confusion, and frustration could have been avoided if the data collected was clean and accurate.

The purpose of the engagement was to identify a supplier that would provide secondary packaging items used to protect the goods inside of another form of packaging. This is a savings category we source for a number of clients, and we have a lot of experience in it. We received usage reports and data from both the client and supplier, which we combined to create the market basket that each alternate supplier would bid on during the RFP process. Once we received the proposals, it was clear that there were issues with the bids as there were major differences in the price proposed for each item across the participating suppliers. As a result of further analysis of the proposals, it was determined that the suppliers were not quoting "like for like" or providing quotes for the exact items contained in the market basket due to inaccurate information in the RFP.

This was a major problem -- it is impossible to evaluate the current market and develop accurate targets if the pricing submitted by a supplier during the bidding process is incorrect. In order to remedy the situation, the data included in the market basket had to be cleansed and resubmitted to the bidders, so that they could confirm whether the pricing they originally proposed match the items contained in the market basket.

Data collection is one of the most important phases of a sourcing event. It sets the foundation of the initiative, providing the overall spend figures necessary to evaluate the current state of a spend category and is used to compare the results of sourcing initiative. When collecting data that will be used during any sourcing initiative, it is important to:

  • Ensure that descriptions are as accurate as possible. General or incomplete descriptions creates assumptions, which in turn, causes discrepncies in pricing when the assumptions are invalid.
  • When applicable, provide any associated part number and/or manufacturer information. Bidders can use this information to research the product and ensure that they are quoting the item correctly.
  • The unit of measure should be clearly stated. For example, the "price per case" will be different than the "price per unit" 
  • Make sure you are knowledgeable of the items contained in the market basket. Suppliers will reach out to about with questions and it is important that you understand the functions of the products.
  • When assessing the current price during data collection, it is important to know whether tax or freight is built into the price. Often, suppliers may quote a delivered price include the cost of freight, so make certain that this information is known and communicated to Bidders during a sourcing engagement.
Gathering accurate data during the data collection phase is imperative as the data will be used during each phase of any sourcing process. Trying to conduct sourcing events with data that is incomplete increases the time and effort during a sourcing event for both the supplier and the company facilitating the event. Clean data can eliminate thes 

A new round of bonuses and penalties have been handed down by Medicare, raising payouts for 1,200 hospitals and cutting them for 1,400 more. The bonuses and penalties are part of a lesser-known section of the Affordable Care Act, aka Obamacare, and are overseen by Medicare.

The program, which withheld a portion of all Medicare payments across the board to build a reservoir for the rewards, is based on hospital rankings which are intensifying as the years progress. In addition to first-year measurements of adherence to standards, quality of care, and hospital-borne illness frequency, hospitals this year were graded on death rates this year. In the next few years, measurements comparing Medicare costs at each hospital and tallying medical mishaps by location will be included.

The desired outcome of this program is clear: hospitals must improve their service levels and scrutinize their spending if they do not want to see a reduction in payments. Conversely, those hospitals most in need of a service upgrade must do so with less money.

As these hospitals are upgrading food carts to eliminate squeaky wheels, buying new beds, bringing in new and additional equipment to meet the heightened standards, and bringing in quality control people to oversee these upgrades, they aren't doing it with free money. Each of these upgrades and additions comes with scrutiny and modifications to their budgets. These budgets are very likely already strained. Throw in a reduction of Medicare reimbursements, and the stage is set for a repeating cycle of unable to improve performance-penalty reduction-unable to improve performance-penalty reduction.

For hospitals, the most common method of finding savings is through a GPO. Some hospitals are members of more than one. GPOs, allowing for pooled buying of commodities at pre-negotiated or discounted rates, do allow for some savings. But purchsing through GPOs exclusively leaves money on the table.

Hospitals that have implemented strategic sourcing practices or contracted with strategic sourcing partners have realized savings far greater than those provided by GPOs. In addition to cost savings on commodities like paper towels and janitorial supplies, hospitals are also able to save in categories with cartel conditions, like blood, and capital expenditures like MRI and XRay machines. In addition to the sourcing services, companies like Source One offer optimization audits and services, eliminating wastage and unnecessary redundancies from telecom and data networks, and ongoing audits, ensuring that agreed-savings are implemented in the invoices.

Long story short: hospitals are facing increased pressure to optimize their budgets and purchase more with less. Partnering with a procurement services firm like Source One offers many healthcare agencies facing ACA and Medicare pressures some much-needed budget relief.

For an in-depth look at what Source One can do for hospitals and healthcare organizations, follow the link
Conference to address global problem of raw materials shortage

In addressing the raw materials shortage felt by the global community, politicians and researchers are expected to gather at a conference organized by the European Cooperation in Science and Technology (COST). The conference, held at the Delft University of Technology (TU Delft), aims to find solutions to declines in limited natural resources, which have led to shortages in materials used by a huge range of industries, from manufacturing to medicine. Problems from material shortages - and consequently, higher raw materials costs - are compounded by rising global population rates.

'We're bringing together policymakers and scientists from various disciplines to analyse the problem of global scarcity of materials and to explore potential solutions," said Dr. Erik Offerman, researcher at TU Delft.

Offerman suggests that strategic sourcing and effective resource management is integral to maintain a sustainable supply of raw materials.

"The search for new materials that are less dependent on these critical raw materials, better recycling possibilities, sustainable mining and design for the circular economy are thus a matter of real urgency for Western countries and it's also a great opportunity for our economy and our environment," Offerman said.

Britain timber shortage felt by other industries

One material shortage felt in Europe includes timber in the United Kingdom, The Economist reported. The country's Forestry Commission reported sawn timber production in the domestic forestry industry rose 22 percent from 2008 and 2012. However, this rate of growth has slowed due to a deficit in commercial investment in processing facilities, resulting in a timber production loss of 40 percent.

The effects of the lack of investment in the forestry industry has led to a timber shortage felt by other sectors of the U.K. economy, including the real estate and construction industries. These segments face pressure to obtain local timber since demand for housing has increased. The Structural Timber Association said 30 percent of new residential construction in England is projected to have timber frames and this percentage is higher for Scotland with 72 percent of houses built with timber.

Another reason for the shortage stems from new regulations requiring companies to utilize materials that produce low carbon emissions, leading to more demand for locally sourced timber.

With the conference putting a spotlight on global materials shortages, companies are likely to change their sourcing strategy in the face of rising demand for a dwindling supply of materials.

Source One Management Services, LLC has won our second consecutive Green Supply Chain Award from Supply & Demand Chain Executive Magazine. We were recognized as a supply chain and procurement solutions provider that delivers sustainable supply chain solutions to leading companies.

The common belief is that sustainable and green initiatives come at a higher cost than if traditional methods were used. Source One has enabled its clients to see that eco-friendly and green products aren't always expensive. Whether a client desired a move to green office supplies, to cut fuel costs and usage, or to roll out  environmentally friendly RoHS-compliant computer equipment, Source One has lead the endeavor, exceeding the clients' needs and securing cost savings in the process.

The Green Supply Chain Awards, overseen by Supply & Demand Chain Executive Magazine, recognize those companies that have leveraged a variety of sustainable approaches - including technology, strategies, and solutions - that companies are employing, and spotlights concrete results that many of these leaders witness due to their sustainable efforts. The awards also recognize providers of green supply chain solutions who assist their customers in achieving their sustainability goals.
Target following green procurement retail trend with sustainable product standard

Target is implementing a sustainable product standard to reduce the environmental impact of its suppliers to keep up with sustainability initiatives launched by its competitors, according to Sustainable Business News.

This announcement comes after Walmart previously established its own Sustainability Index, which may indicate that sustainable sourcing is trending among major corporations. Large retailers like Target and Walmart are paying closer attention to environmentally friendly goods because there is an increase in demand for sustainable products. While increased sustainability has been a way to reduce manufacturing costs and other expenses in the past, this business approach has determined the competitiveness of large corporations.

"With the Target Sustainable Product Standard, Target will help push the industry toward consensus on what sustainable standards should be and create incentives for innovation in this highly competitive space, ultimately broadening the sustainable product selection for their guests," Dara O'Rourke, co-founder and chief sustainability officer of GoodGuide, said in a statement posted on Target's blog.

Products scored based on environmental sustainability

As part of the Target Sustainable Product Standard, Target will have its vendors of more than 7,500 products complete an assessment. Products sold by Target will be scored with a point system of up to 100 points. Factors in the point assignment for products will include sustainability of ingredients and their overall environmental effects.

While products in categories such as household cleaners, personal care, beauty and baby care have already begun this assessment, cosmetic products will also have points assigned starting in 2014. With more consumers shifting toward environmentally conscious retail goods, companies might have to step up their green procurement strategies in different aspects of their manufacturing. For example, packaging. Target already practices sustainable sourcing for its packaging through reducing resource waste.

"To improve our packaging, we recently set a goal to make more of our owned-brand packaging designs more sustainable by the end of 2016," Target said on its corporate responsibility page. "To achieve this, we plan to reduce the overall materials used, include more recycled or renewable content, and reduce as much product waste as possible."

In furthering its corporate responsibility goals, Target also said it was a participant in the Environmental Protection Agency's SmartWay Transportation Partnership to reduce the carbon emission impact of its transportation operations.

With corporations ramping up their efforts to ensure products have fewer harmful chemicals, manufacturers might also have to follow suit if they want to remain competitive.

In one word, “”, a perfect example of what a dedicated and thorough sourcing event can avoid. I don’t need to know all the details behind the 36 hour crash of the website or the specific reasons for Google, RedHat and Oracle experts to come to the rescue to understand that someone somewhere did not conduct sufficient due diligence prior, during and after the website launched.

Many sources have identified several “vulnerabilities” including software, hardware and security issues within the site’s operation, all risks that large scale program like this cannot afford. Granted, the website is back on live and the bugs have been fixed, but at what cost?

This may look like a rather easy thing to avoid but unfortunately, this is not an uncommon situation for corporations out there either. While many will criticize this particular event because of its magnitude and relevance to society, this is a typical situation in the strategic sourcing world. More often than not, companies engage supplier to provide services out of their core competencies and that ultimately cannot competitively provide, or do it inadequately, in some cases because the services providers lack the capabilities, in many other cases because the client is not communicating the needs and the business requirements transparently, because of privacy concerns, poor communication, and most frequently because of internal imbalance, in other words, the client itself is not clear on what they need.

Sourcing events are most effective when two ingredients combine: one, (what we call) “the scope of work” is clear, and two, the suppliers understand it, oh, and one more thing, it has to be in that order. Otherwise, companies will end up hiring a company that “seems” to have what it takes, the one with the best salesperson, or simply the cheapest (this one being the popular choice). What many companies don’t understand is that any mix of the above, may also not the best choice.

Best practices of strategic sourcing are intended to allow companies select suppliers that can offer the best possible service at the lowest cost, this includes going beyond the requirements and incorporation “value adds” to the mix while leveraging data from the market place. A clear scope of work will help you get there. Our sourcing experience (and common sense) dictates that a supplier who doesn’t understand what you need, will charge you more for what they offer you (to mitigate their risk), and much likely, if your scope is not clear to you either, you will probably end up paying for it, or re-sourcing the event to “fix the bugs”, in some cases like the one describe above, it will be both.

Here at Source One we like to keep our analytic skills sharp. One way we do that is by sending Excel tips out to our staff a couple times a month. This serves a couple purposes: people have the opportunity learn something new, or refresh their memory for seldom-used skills that might slip the mind. Because it's in their email, they can review these tips when they have the time.

Here are some recent tips we shared with our staff. Hopefully they can help you too.

1) Multi-tier chart Axis:

You can create charts with multiple tiers of data on the X-axis as shown here. 

To do this, format the source data as shown in the following table, allowing for blank spaces in the first and second tiers.

Bonus tip: Instant Chart

Select any cell within your data set and press F11. Excel will create an instant chart based on the current data, which you are then free to customize as normal. 

2) Editing Multiple Sheets Simultaneously 

Often there is a need to set up several sheets in a similar manner, or to make the same edit to identical sheets in a workbook. In the same way that you are able to select multiple cells in a worksheet, you can also select multiple sheets within a workbook. Changes that you make will then apply to all selected sheets. 

1) Click the first sheet you want to work with
2) Hold shift and click the last sheet you want to work with. The selected sheets will be highlighted in white.

Any changes you make will populate on all the selected sheets.

  • Make sure you only have a single sheet selected when entering data specific to that sheet. Do this by right-clicking the sheet and selecting  "Ungroup Sheets" or by clicking on a sheet that's not selected. Failure to do this will result in identical data across all sheets in the workbook
  • Certain features, like advanced formatting and inserting text boxes, are disabled while multiple sheets are selected. Other features, like re-sizing columns, will only apply to the visible sheet and will not populate through to other sheets. 
What features or formulas in Excel do you use most often?  Or is there a big time-saver you want to share? Let us know in the comments. 
GSA calling for green technologies to improve building efficiency

The General Services Administration is seeking green technologies to test at, and incorporate into, federal government buildings, according to The Washington Post.

As part of the Green Proving Ground program, the agency said it will use its facilities, accounting for the more than 9,200 buildings it owns and leases, as testing sites. The GSA said it plans to evaluate innovative building technologies as well as energy and water conservation practices. One of its goals is to reduce operational costs, which could be incurred through heating, cooling, ventilation, electricity consumption and other factors.

In addition to GSA federal buildings, technologies used for the program could also make an impact on other government agencies and the real estate industry, according to the GSA.

The government investment in green building technologies could contribute to the net worth of the building industry. This sector, which accounts for both new construction and renovation, makes up over 9 percent of U.S. gross domestic product, according to the Department of Energy. The value of residential and commercial repairs and retrofits was estimated to be around $400 billion in 2005. Improvements that add to the value of the building industry have included commercial lighting retrofits as well as complete renovations.

Green technologies improve energy efficiency

Examples of green technologies chosen by GSA in 2011 include smart windows, occupant responsive lighting and photovoltaics for renewable energy generation. Some of these technologies have also been incorporated in green building programs. This is the case for occupant-controlled lighting, which earns a point toward the Leadership in Energy & Environmental Design (LEED) certification program developed by the U.S. Green Building Council (USGBC) to advocate and promote energy conservation. The Energy Department said buildings consume more energy than the industrial or transportation sectors, responsible for 40 percent of all energy consumption in the U.S. and 72 percent of all electricity use.

USGBC's LEED program encourages improvements in the energy efficiency of existing and new buildings to reduce impact on the environment and increase resource effectiveness. For LEED procurement in regard to occupant-controlled lighting, buildings must be able to advance the productivity and comfort of its occupants through lighting controls, according to the USGBC.

Companies could consider procurement consulting to purchase products that are more sustainable, such as energy efficient lighting, to ensure corporate responsibility goals are met. Software solutions that measure building energy consumption could also aid in improving the resource efficiency of company operations.

The GSA submission deadline to donate or provide green technologies, via testing agreements, to the federal government for consideration is Dec. 9.

If you've watched TV in the past week, you've probably seen a lobster promotion at every sit-down chain restaurant under the sun. Outback Steakhouse and Ruby Tuesday suddenly have cheap lobster, and in Philadelphia, near Source One, all the seafood restaurants -- even the hoity-toity ones -- are running lobster specials. It just so happens that lobster prices in North America hit record lows in October of 2013, which is when lobster is at its most plentiful. Low prices + abundant supply = buyers springing into action, aggressively. Hence, steak and a lobster tail for $15. This is part of category management -- having such in-depth knowledge and oversight over a particular category that you can foresee changes in the market and capitalize on trends and dips.

Restaurants are some of the best at monitoring the markets and buying when prices are right -- see this article about how McDonald's McRib only shows up when pork prices are way down -- but the practice can carry over into any purchasing department, including yours. So, how can you hone your category management skills to take advantage of pricing changes?

1. Know the Category

Knowing the category, and the products within it, is the most critical part of buying at the right time. Understanding how the goods are priced -- if there's an index involved, if their prices are affected by speculators or other market factors, and if there's any seasonality to the particular market.

2. Work with Suppliers

If you lack knowledge of the product and category, you can likely glean some knowledge from suppliers. In a category like IT, where product lines and specific SKUs have definitive lifecycles and a competitive marketplace, a good supplier relationship can get you the inside information you need.

Need to upgrade 200 monitors? HP is running a promotion in two weeks, but if you need printers, Model X is deeply discounted as they clear out stock.

This kind of in-depth relationship with a supplier takes work, but once an open and healthy communication stream is established, it can pay benefits. This goes far beyond an approved supplier with a web portal.

3. Be Flexible

The same mentality that allows travelers with a rubber schedule to capitalize on deeply discounted last-minute air fares can allow you to take advantage of good pricing. Look at your supply chain for a minute - do you have excess warehouse space? Can you accommodate/use a similar product if a functionally similar good is priced exceptionally well compared to the desired product? A bit of corporate flexibility can pay dividends when its time to take advantage of a low price.

So while these takeaways are part of what's needed to effectively manage a category and leveraging that management for additional cost savings, they're not the whole package. If you have questions, we're here.
Field service companies concerned about business efficiency

Companies that have employees regularly out in the field are often concerned about inventory when it comes to spend management. However, this problem could be solved with the right field service software solutions to streamline business operations. To find the best telecommunications and employee management software, auditing services are helpful in connecting companies to affordable software solutions.

According to the survey by software provider FieldAware, 68 percent of technicians respond to an average of three service calls or more per day. In comparing different duties field workers were responsible for, 39 percent of respondents indicated the most common business response was time reporting.

A growing trend among businesses is the use of mobile solutions to manage their employees while off-site. According to the survey, 61 percent of organizations said their field workers employ smartphones or tablets on the job. Mobile and field service software help increase business efficiency, which is one of the reasons why companies often upgrade their processes to include these solutions. In the survey, 68 percent of participants listed efficiency as their biggest concern, saying it is necessary to boost the effectiveness of their field process.

Using mobile solutions to increase business efficiency

Mobile field service solutions usually incorporate software to help view, process and complete work orders. In the survey, 39 percent of companies said they use third party management software and 27 percent use their own application. Some firms do not utilize software solutions at all,  with 22 percent choosing to have paper forms and invoices instead.

One of the benefits of field service software is the convenience of having these typical business processes automated for workers, according to Business2Community. Managing inventory is a responsibility that is common yet crucial for field workers. Field service software can send notifications to employees when inventory is out of stock to quickly communicate this information to customers or let them know which parts or equipment they need to complete a job before driving to an appointment site. Being prepared for a job by having the right tools and products makes a significant difference in travel time as well as productivity when servicing customers.

Connecting inventory information with mobile solutions allows field workers to keep up-to-date at all times wherever they are in the field. By receiving information on their smartphone or tablet, they can better help customers by having inventory data in real-time at their fingertips.