5 Critical Mistakes When Restructuring the  Supply Base 

Tariffs, covid, shortages, war, and inflation.  We have experienced over 5 years of chaos that have had purchasing professionals restructuring their supply chains.  However, due to the unprecedented issues requiring immediate firefighting, sometimes shortcuts are taken and the restructuring results are not favorable.  What mistakes are being made, and what are the lessons learned?  We…

5 Steps to Cost Success

Purchasing success cannot be achieved by purchasing organizations or individual buyers without cost success. But what is cost success?  One of the best purchasing leaders in the manufacturing industry explained it to us this way:  “The best purchasing organizations and buyers can answer these questions:  What does it cost?  What should it cost?  What is…

Top 3 Challenges for Finding Mexican Suppliers in 2023

Finding capable suppliers is always a challenge, whether you are focusing on local, regional, or low-cost country suppliers. In addition to reliable supply and competitive pricing, you have to do your homework to vet potential supplier attributes such as: Do they have the right manufacturing processes and experience with the materials you require? Are their…

Supplier Relationships, Key to Effective Nearshoring

According to the World Economic Forum, “Many global manufacturing OEMs have been struggling to find alternative solutions, like shifting orders to secondary suppliers to make up the missed deliveries”, the U.S. in particular sees Mexico as the perfect location for opening more and more production facilities with shorter delivery routes. In the pursue of finding…

Recovering from unprecedented price increases – 4 tips for using a commodity-by-commodity approach

Have you experienced unprecedented upward pricing pressure over the past 3 years?   Purchasing leaders are telling us that they are under increasing pressure to increase cost savings efforts and results.  This has been a challenge to say the least, with unrelenting price increases for the last 3 years.   When working with clients on engagements, we are finding that a commodity-by-commodity…

Getting Past the Hard No in Negotiations 

Cost negotiation becomes a very hot topic when commodity prices fluctuate greatly.  In the last few years sales organizations led the negotiation charge as they sought price increases to offset steep increases in raw materials, labor, and indirect costs.  Now, buyers are starting to initiate the negotiations as some commodity prices have fallen off their…

Strategic Sourcing Corrugated Packaging

There’s never been a better time to “kick the tires” on your corrugated packaging spend. Prices are dropping for the first time in two years as global box demand finally weakens after the severe post-pandemic run-up. Corrugated packaging buyers that don’t have index-based pricing agreements with supplier have two options: hope their box suppliers provide…

Still an Optimal Time to Take Advantage of Supplier Nearshoring

Currently in China, “Zero COVID” policies continue to be implemented that imply extensive confinements. According to The Inter-American Development Bank (IDB), there are estimates that suggest around 79% of US manufacturing companies in China have already started or have plans to relocate part of their operations to North America and Mexico. A big wave of…

2023 – The Claw-Back Year 

Purchasing organizations and individual buyers (I’ll refer to them as buyers) need to develop strategies to claw back price increases that were granted to suppliers in the past three years.    An economist once said that the best solution for high prices is high prices.  Meaning that high prices themselves would self-correct as market forces of…

What’s Your 2023 Savings Plan?

It appears we are finally transitioning from a prolonged period of supply constraints and rapidly rising prices to a more “normal” state. Supply-demand dynamics will vary by commodity, and the possibility of a global recession still looms, but after several years of chasing parts and battling price increases, purchasing teams are poised to return to…