Supply Chain by the Numbers for Week of Aug. 13, 2015

Supply Chain by the Numbers

- Aug. 13, 2015 -

China Risks Global Turmoil with Yuan Devaluation; New Technology Could Send Natural Gas Costs for Trucks Much Lower; Most Companies Still Have Only Backward Looking Analytics; Infor Opens Wallet Up Big Time for Supply Chain Acquisition



3%
That's the approximate level by which China has devalued its yuan currency against the US dollar this week, causing turmoil in markets and across global politics. The yuan is actually down about 6% against the dollar since early 2014 - when many Western companies and politicians were saying the yuan was undervalued then. A lower value for the yuan - the exchange rate for which is set within a range by the Chinese government, not free floating rates like most world currencies - makes China exports still more competitive and imports of foreign made goods into China more expensive. This as China export volumes and domestic economy continue to slow. If China is really trying to gain a trade advantage with the move, "Such desperate behavior would send a deflationary shock through a global economy already reeling from near recession earlier this year, and would risk a repeat of East Asia's currency crisis in 1998 on a larger planetary scale," says UK's The Telegraph newspaper. Keep an eye on this one.

40.1%

That's the percentage of respondents to an SCDigest survey on supply chain business intelligence (BI) and data analytics that said their current BI systems were almost exclusively "backward looking" - what has happened in the past. Of course, the trend today is for more forward-looking BI capabilities - such called “predictive” and “prescriptive” analytics. 36.5% of respondents said they were just starting to build those forward-looking capabilities, while 23.4% said they were aggressively building out these next-generation BI tools. The full report, videos, sample graphics and more are all available here: Supply Chain Business Intelligence Benchmark Report 2015



$675 Million
That's the rather stunning price ERP provider Infor has agreed to pay to acquire GT Nexus, a Cloud-based provider of global trade and logistics solutions used by some 25,000 companies. That's quite a multiple above the $150 million or so in revenue - not profits - GT Nexus had in 2014. Infor, a company build largely on rolling up somewhat struggling companies in ERP and the supply chain software for more than a decade, is changing its approach to market with this deal, says SCDigest editor Dan Gilmore: "This is a really big move for Infor, a much more aggressive and forward looking acquisition than its previous deals." He added that "GT Nexus enjoys a strong market position, and trends in terms of globalization are certainly moving in its favor, with most large and mid-sized companies looking for greater supply chain visibility. Infor paid a high price for sure, more than four times revenues, but this was a big statement relative to its supply chain intentions."



40-60 Cents
That is the expected decrease in the per gasoline gallon equivalent (GGE) out of compressed natural gas (CNG) costs as a result of a new technology called carbon adsorption, according to a new trade association made up of four providers of this new technology, according to press releases this week. The details are highly technical, but the approach only requires pressure of 900 to 1,000 psi, and reduces effective CNG costs because compressing the gas requires less energy, and fueling stations using this technology are simpler and less costly than CNG stations designed for high-pressure gas. It would require a different type of fuel tank on trucks and cars using the technology, but drop the price of filling systems such that small trucking firms and even a home owner might afford to put one in. Will it work? Who knows, but if Yes it could definitely spur adoption and improve the "chicken and egg" scenario relative to demand and supply between potential CNG users and fill station providers.