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Supply Chain by the Numbers

- Jan. 25, 2013

  Supply Chain by the Numbers for Week of Jan. 25, 2013

Walmart Says No More Three Strikes Supplier Policy; Tires to Beer in Major DC Transformation; Union Pacific Keeps the Profit Rolling; US Material Handling Systems Spend Moves Up the Incline



The number of chances Walmart will now give suppliers if they violate certain of its policies, specifically around sub-contracting to non-approved factories, according to a letter sent to its suppliers this week. The new "zero tolerance" policy, changed from the previous "three strikes and you're out" approach, comes after Walmart was indirectly connected to a deadly fire at an apparel factory in Bangladesh that killed 112 workers. A de-certified facility was given Walmart production work as a sub-contractor to the main supplier. Other changes were also announced, such as that new factories even of existing suppliers must be "pre-certified," and that suppliers must have direct employees monitoring their factories or those of contractors, rather than using agents.




Rise in Q4 operating profits year over year for rail carrier Union Pacific, to an all-time record, as the company reported outstanding financial results in a tepid overall economic environment and flat or shrinking freight climate. Car load volumes were actually down about 2% in the quarter, as the company cited "core pricing gains and fuel surcharge recoveries" as key to financial results, plus operating efficiencies. The rail carriers simply continue to roll on from a bottom line perspective.

$21.2 Million

Amount of investment that beer and wine distributor Heidelberg Distribution will make to upgrade a 779,000 square-foot, former Cooper Tire distribution center just off I-75 near Dayton, OH, before moving in six months from now. Heidelberg acquired the site for another $7.5 million. The investments include $6.3 million for a new roof, $2 million for floor replacement, $4.7 million for office construction, and a lot more. The company will also increase the number of dock doors from 12 to 60. Cooper left the facility in 2007. That’s a lot of money to invest, but Heidelberg is receiving significant tax breaks from the city, county and state of Ohio.



Approximate levels of growth for new orders of US materials handling equipment and systems in 2013, about on par with 2012, according to trade organization MHI at its ProMat trade show this week in Chicago. Equipment shipments are expected to rise about the same level. That, like the economy overall, represents decent but not outstanding growth. MHI expects that growth level to increase modestly over the next three years.

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