Supply Chain by the Numbers

- March 7, 2013

  Supply Chain by the Numbers for Week of March 7, 2013

Walmart Blows Away the Field; Manufacturers Say Costs Will Go Down Big Time in 2013; Maersk Gets More Carbon Efficient - but "Slowly"; More Good News on the Natural Gas Front




The level of reduction in cost of goods sold (COGS) on average that US manufacturers plan to achieve in 2013, according to a new study released by The Hackett Group this week. That aggressive goal would come on top of a similar 1.5% reduction in COGS that the manufacturers across a number of industry sectors said they achieved in 2012. 3% in two years would add quite a bit of profit to the bottom line - unless the manufacturers simply give it away in price decreases. Interestingly, outsourcing is way down as a percent of where execs see the savings coming from, down to just 12% of total expected savings. The big driver? Improvements in internal manufacturing efficiencies, at 47% of the total. Procurement gains made up the rest, at 42%.




Reduction in CO2 emissions per container moved in 2012 at shipping giant Maersk Lines in 2012, according to the company’s 2012 Sustainability report released this week. That sounds like good news, except most of those gains, the company said, were obtained by so-called "slow steaming," the practice Maersk pioneered in terms of significantly slowing down a ship's speed to reduce fuel consumption and in effect reduce capacity. Good for costs and the environment, but perhaps not so good for supply chain efficiency.


Number of a couple of hundred consumer packaged goods manufacturers which picked Walmart as having one of the top 3 retail supply chains, according to the 2012 annual PoweRankings study by Kantar Retail, which we reported on this week. Compare that to number 2 Costco, which scored just 28.3% - more than 60 percentage points below Walmart's score. By comparison, on the CPG side, number 1 Procter & Gamble saw just 28.4% of retailers saying it had one of the top manufacturing supply chains. So, again this year, Walmart wins in a route, and P&G again claims the top CPG spot, but just barely. See Which Retailers had the Best Supply Chains for 2012?



Number of tons of liquefied natural gas that two new plants from Royal Dutch Shell will be able to produce when they are completed, the company announced this week. One plant will be built in Louisiana, and the other near in the Ontario province in Canada. That 250,000-ton capacity at each plant is relatively small in comparison to some facilities in the Middle East, but will about double current North American capacity. The production is focused on supplying "heavy trucks and large ships," the company says. It is coming, it is really coming.