Supply Chain by the Numbers for Week of Sept. 16, 2011
Procter & Gamble Moves Down Market; Truckoad Volumes on the Rise; Retail Sales Heading the Other Way; Companies Paying Vendors on Time?
The approximate cost per ounce for which Procter & Gamble's new Gain dishwashing soap sells at versus its most premium brands, according to a story in the Wall Street Journal this week. The thrust of the article was how P&G and other companies are moving down market, and/or more aggressively adopting high/low strategies, in the face of law wage growth and continued poor economic times.
Number of days on average "beyond term" in which companies are paying their suppliers, according to the latest report on the subject from Cotera. Perhaps surprisingly, that is actually near the record low of just 5.05 days the same study found in May of this year. We're a bit surprised given the still soft economy that customers aren't stretching payments out further, but this could be reflective of record low interest rates (the money's not worth much), strong cash positions at many companies, and perhaps even increased electronic payments.
In some positive news on the economy, truckload carrier Swift Transportation's CEO this week said he expects freight volumes to be up 4% year-over-year in the third quarter. That after spot market truckload demand increased 4.5% from July to August, according to TransCore Freight Solution’s spot market index, whereas month over month volumes from July to August have on average declined 2.9%. New worries about tight truckload capacity are emerging.
Growth in retail sales in August excluding automobiles, gas and building materials, the worst performance thus far in 2011, according to Commerce Department figures released this week. The numbers for July were revised downward to just a .3% gain, more evidence that the tepid recovery is wobbling.