The world received good news recently. According to a report from the Food and Agriculture Organization of the United Nations, there are over 200 million less people living in food insecurity than there were just fifteen years ago. This welcome news comes despite a global population increase of more than 2 billion people in the same timeframe. The UN’s report credits social and economic advancements for the progress, but there is a third factor underpinning both of those: industry.
so much depends
a red wheel
glazed with rain
beside the white
(William Carlos Williams, 1923)
You can still make a living with the things Williams mentions in his poem. Most of us won’t. But even though times have changed since 1923 when it was first published, the poem continues to resonate. Our livelihoods still depend on the products we utilize and consume to get the job done, whether that means banging on a keyboard all day or banging on nails.
In every industry, supplies are essential.
From a father-and-son contractor outfit to a massive corporation or municipality, someone has to be responsible for the industrial supply chain. The better that person or team is, the more seamless their work becomes. But if they are struggling, the health of the business or organization is at risk. Clients go underserved. Capital gets trapped on shelves collecting dust. That’s why inventory supply managers have such a complex and critical role.
Every paper clip really does count.
Inventory investors know better than to ignore the details. But then, if a business is going to fail based on the fate of a single paper clip, it’s probably past time to get the old resume in order anyway. While the details do matter, advanced inventory management software and tracking systems can handle the bulk of the clerical duties.
Automating the routine aspects of industrial supply management allows purchasing professionals to focus on more important tasks.
For example, inventory managers need to understand the entire cost structure of their supply chain. That means analyzing a potential supplier’s prices is just the beginning. Industrial supplies are driven by “derived demand,” which simply means that the need for those supplies depends on the consumer demand for the things those supplies help to produce. A wise inventory manager will build relationships only with suppliers who understand derived demand, and who know that complete shipments with reliable lead times is the best way to control carrying costs.
Carrying costs can fluctuate from 20-30%, endangering a company’s total return on inventory investment.
The longer you have something, either still in the mail or sitting unused on your shelf, the more carrying cost it accrues. These costs can include interest on credit, labor costs, insurance, and even shrinkage. When deciding on a supplier, be sure the supplier takes the time to understand the gross margin of your return on investment.
At Steiner Electric, we know that our business is only as healthy as the businesses and communities we serve. That’s why we take pride in our role as an industrial supplies management resource for our clients. Let us audit your industrial supply chain to make sure it is operating as efficiently as possible, because “so much depends” on the supplies of your trade.
-By Ron Styne
The date may tell you its spring, but it still looks like winter when it comes to Lake Superior. The major effect of ice on the Great Lakes is crucial because it impacts many things from the fishing industry to commercial shipping and has actually had an impact on steel conduit. The amount of ice cover on the Great Lakes varies from year to year. However, according to the NOAA, National Oceanic and Atmosphere Administration Great Lakes Environmental Research Lab, the average thickness of ice on Lake Superior is 8.9 inches thick.
A key ingredient in the production of steel conduit is iron ore. Iron ore loaded on ships needs to come through the Great Lakes and make its way to production facilities so that it can be used in the production of rolled steel, which in turn is used to make steel conduit. According to the director of traffic services for the US Coast Guard, while shipping times are improving on the Great Lakes, there are 60 vessels waiting to lock through Lake Superior.
In wake of one of the worst winters in decades, there are calls for more US ice breaking capacity for its water ways.
So in essence, the harsh winter is still impacting the production of steel conduit.
-By Ron Styne
People wonder how the price of copper and steel are determined because those levels have such an impact on many of the products sold in both the electrical and industrial industries. The price on metals is determined by the London Metal Exchange (LME). Continue reading “What is the London Metals Exchange?”