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Supply Chain by the Numbers

- Oct. 18, 2013

  Supply Chain by the Numbers for Week of Oct. 18, 2013

US Bridges are Broken; Family Dollar Gets Aisle-Ready; Major US Aluminum Plant to Kick the Can; More Death in Bangladesh


$76 Million

CapEx investment in supply chain improvements in the past year by Family Dollar Stores, according to its quarterly earnings call this week. That included a new distribution center in Utah to support West Coast stores, but what caught our eye were the investments to enable aisle-ready pallets. "In our new pallet delivery program, goods will now be sorted by department and cleanly stacked and packaged on pallets, which can be taken straight to the sales floor," said COO Michael Bloom on the call.




Number of bridges in Pennsylvania that have deemed to be "deficient," the highest such ratio in the nation, where the overall number is said to be 1 in 9. Whether that reflects reality or just a difference in rating scales/processes isn't clear. Regardless, the Pennsylvania DOT recently downgraded 1000 of the state's bridges and reduced weight limits, causing a detour into and out of an Armstrong industries' tile plant that will cost the company as much as $300,000 in extra transport costs annually. Bridges are at last becoming a real issue for logistics.



Number of workers killed in yet another apparel fire tragedy in Bangladesh two weeks ago, in a blaze that took the life of the general manager of the Aswad garment outside Dhaka. That after the enormous tragedy of the collapse of a building in Bangladesh earlier this year that was home to several apparel operations, and in which about 1100 people were killed in one of the greatest industrial disasters ever. There are rival plans by US and European retailers and brand companies to improve factory safety in Bangladesh, but the companies are mostly still working out the details.



Approximate price per ton for aluminum right now, down from around $2600 two years ago, amidst a global glut of the metal. That low price has consequences, and this week Ormet, the US' fourth largest aluminum producer, announced it is closing its Hanibal, OH smelter and selling the operations to whomever it can. The key issue: electricity costs, which account for 25-33% of the smelter's operating budget. Ormet had been getting energy subsidies from the state to allow it to weather the aluminum price storm, and asked for more to enable it to switch over to cheaper natural gas power, but its request were denied. The plant employed some 1200.

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