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Supply Chain by the Numbers

- Sept. 13, 2013

  Supply Chain by the Numbers for Week of Sept. 13, 2013

Walgreen's Building New Supply Chain Capabilities; International Paper Closing Major US Factory; New Rules Said to be the End for Coal-Powered Electric Plants; Europe Turns to DC Automation




Number of new supply chain capabilities that drug store giant Walgreen's has determined it needs to meet future needs, as part of its effort to develop a new supply chain strategy. That according to Paul Dittmann, who heads the University of Tennessee's supply chain forum, during a presentation this week at the annual Material Handling and Logistics Conference in Park City, UT. Dittmann was presenting on the key concepts covered in his recent book Supply Chain Transformation, which in part are what Walgreen's used to develop its strategy. Those 11 new capability requirements have spawned some 25 separate projects, Dittmann says. Walgreen's SVP of supply chain and logistics, Reuben Slone, go way back, including stints together at Whirlpool.




Portion of US electrical power that is currently produced by coal-powered plants. That as news leaked this week that the US EPA is prepared to soon present new proposed rules on carbon emissions that would in effect eliminate any new coal-based generation facilities in the future. The requirements, according to the Wall Street Journal, will be for coal-plants to create no more than 1100 pounds of carbon per megawatt hour produced. That is well below current levels, and below what can be achieved even with the most modern technologies, coal advocates say. The EPA will argue that these levels can be achieved with so-called "carbon sequestration" technologies, but they have never been used in large scale operations. Manufacturers warn the new rules, if ultimately approved and they withstand court challenges, could lead to issues with consistent power delivery.


Number of workers that will be out of a job soon, as International Paper announced this week that it was going to shutter its largest US factory in Courtland, AL. The move to reduce capacity comes as demand for paper in some sectors continues to shrink, as everything from email to on-screen viewing reduces the need for paper products. That said, the news came just one day after the company said sales overall are growing, and it boosted its dividend 17%. The Courtland plant makes copy-type paper as well as coated paper for magazines. International Paper said it considered spending capital to upgrade the plant's lines to make other products, perhaps such as corrugate, but in the end decided the return just wasn't there.


100 Million

Number units that one global apparel company ships annually out of a 500,000 square foot distribution center in Europe. That same company, with a very similar demand profile, ships just 90 million units out of a 2 million square foot facility in the US. The difference of course: heavy use of automation in Europe, including high rise storage and case picking automation. That according to Chris Lingamfelter of Dematic, at the Material Handling and Logistics Conference this week in Park City, UT. Europe is far ahead of the US in terms of DC automation - and automation of everything - Linamfelter made clear. Land and labor costs are a big factor.

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