Supply Chain by the Numbers for Week of April 5, 2013

Supply Chain by the Numbers

- April 5, 2013

Walmart Expanding E-Fulfillment Store Test; Input Costs Flat in Q1; Lululemon QA Problems to "Sheer" Profits Big Time; US Export Progress, but Reaching 2015 Goal Will Not Happen



50
Number of stores Walmart stores the retail giant intends to use as e-fulfillment centers sometime this year in an expanded test of the concept, according to recent comments from Joel Anderson, chief executive of Walmart.com. That's up from about 25 stores at present. Walmart hopes that using the stores as fulfillment centers will provide it an advantage over increasingly fierce rival Amazon.com, which uses fulfillment DCs to get products to consumers. Perhaps Walmart can have lower shipping costs and be better able to provide same day delivery almost country-wide by leveraging its network of thousands of stores. See Multi-Channel Fulfillment Wars Continue on, as Walmart Makes a Lot of News.

$67 Million

Unbelievably, the upper end of the cost estimates that apparel retailer Lululemon now says will be incurred from customer refunds, a product recall and scrapping existing or in-transit inventory of yoga pants in which the material is apparently too sheer, showing your undies to the world, depending, apparently, on which way you are positioned. That's about 5% of its 2012 revenue. The scandal cost the company's Chief Product Officer her job this week. Naturally enough, inadequate QA processes are being cited for the disaster.



	.4%
Change in the Thompson Reuters /Jeffries CRB Commodity Price Index in Q1, consistent with other such indices that also showed input costs in general were primarily flat over the first quarter of 2013, and the lowest Q1 jump since 2010. In general, oil prices were up a bit, natural gas prices were up big, metals prices were down somewhat sharply, and agriculture products were mostly down, corn and cotton the major exceptions. Combine that with a generally strengthening dollar, which has the effect of reducing commodity costs for US buyers, and input costs didn't have much impact either way on the bottom line in Q1. See Input and Commodity Costs Mostly Flat in Q1, Lowest Rise Since 2010.




$2.19 Trillion
Amount of US exports in 2012, up from $1.57 trillion in 2009, when the Obama administration set a goal of doubling US exports to $3.14 trillion by the start of 2015. Doesn't look like there is much chance that goal will be reached, as the 2012 figure is up 39% from 2009, with just two years to go to reach the goal. While US exports rose almost 16% in 2011, the jump was a much smaller 5.5% last year - though that is certainly OK in absolute terms, given global economic conditions, especially in Europe. Some US manufacturing proponents, however, focusing on export levels misses half the picture. The US imported $540.4 billion more in goods and services last year than it exported, down only slightly from the record $559.9 billion trade deficit in 2011.