Archive for June 3rd, 2010

This has been the toughest year and a half since the 1930s … oh really ?

June 3, 2010

Every promoted business manager faces challenges that were rolled to him by his predecessor.

From my consulting days, I know that all companies think that they’re competing in the most challenging industries, at the most challenging times, against the most formidable foes ever.

Effective managers read the cards they were dealt and craft the strategies and tactics required to remediate the issues and leverage the jewels.

Ineffective managers just whine about the weak hands they were given, remorse over unkindly “shocks”, and focus on ducking blame.  In business they don’t last very long.

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Excerpted from Politics Daily: Obama, the Thin-Skinned President
http://www.politicsdaily.com/2010/05/27/obama-the-thin-skinned-president/

In a fundraising event for Sen. Barbara Boxer, President Obama repeated his constant refrain:

“Let’s face it: this has been the toughest year and a half since any year and a half since the 1930s.”

Really, now?

  • Worse than the period surrounding December 7, 1941 and September 11, 2001?
  • Worse than what Gerald Ford faced after the resignation of Richard Nixon and Watergate, which constituted the worse constitutional scandal in our history and tore the country apart?
  • Worse than what Ronald Reagan faced after Jimmy Carter (when interest rates were 22 percent, inflation was more than 13 percent, and Reagan faced something entirely new under the sun, “stagflation”)?
  • Worse than 1968, when Bobby Kennedy and Martin Luther King, Jr. were assassinated and there was rioting in our streets?
  • Worse than what LBJ faced during Vietnam — a war which eventually claimed more than 58,000 lives?
  • Worse than what John Kennedy faced in the Bay of Pigs and in the Cuban Missile Crisis, when we and the Soviet Union edged up to the brink of nuclear war?
  • Worse than what Franklin Roosevelt faced on the eve of the Normandy invasion?
  • Worse than what Bush faced in Iraq in 2006, when that nation was on the edge of civil war, or when the financial system collapsed in the last months of his presidency?
  • Worse than what Truman faced in defeating imperial Japan, in reconstructing post-war Europe, and in responding to North Korea’s invasion of South Korea?

In Obama’s eyes, he is always the aggrieved, always the violated, always the victim of some injustice.

He is America’s virtuous and valorous hero, a man of unusually pure motives and uncommon wisdom, under assault by the forces of darkness.

It is all so darn unfair.

Or maybe a man who was as unprepared to be president as any man in our lifetime — has over the last 16 months shown that he is overmatched by events.

Source: “Obama, the Thin-Skinned President”
http://www.politicsdaily.com/2010/05/27/obama-the-thin-skinned-president/

Posted in Obama Administration | Leave a Comment »

Sharpen your pencil, there’s a Walmart truck at your loading dock.

June 3, 2010

Punch line: Walmart is starting to pick-up merchandiser at suppliers docks — rather than have the stuff shipped to WMT distribution centers for subsequent redistribution to stores. Three reasons:

(1) WMT can usually move the stuff cheaper because deals in economical full truck loads and has highly productive logistic processes in place

(2) WMT has the clout to command price reductions that may exceed the suppliers cost cuts

(3) For sure, suppliers will allocate more of their fixed costs to WMT competitors who don’t have the scale, interest or capability to do their own picck-ups

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Excerpted from BBW: Why Wal-Mart Wants to Take the Driver’s Seat, May 27, 2010

Wal-Mart, the world’s largest retailer, has become famous — and at times infamous — for the power it wields over its suppliers … to create environmentally friendly packaging and exclusive product sizes, and to participate in joint advertising promotions.

Now, Wal-Mart wants to take over U.S. transportation services from suppliers in an effort to reduce the cost of hauling goods.

The goal: to handle suppliers’ deliveries in instances where Wal-Mart can do the same job for less, then use those savings to reduce prices in stores.

Wal-Mart believes it has the scale to allow it to ship everything from dog food to lawn chairs more efficiently than the companies that produce the goods.

Manufacturers would compensate Wal-Mart by giving the retailer lower wholesale prices for the goods it transports.

Until now, suppliers made most deliveries to Wal-Mart’s distribution centers. The retailer then used its fleet of 6,500 trucks and 55,000 trailers to ferry goods between the regional centers and individual stores. Under the new program Wal-Mart will pick up products directly from manufacturers’ facilities.

That will allow Wal-Mart to carry more per truck and improve on-time delivery rates … and give it  more sway in negotiating fuel prices, thanks to its larger purchasing volume.

The price cuts Wal-Mart is seeking are twice as much as the cost of transporting goods in some cases. In two instances, Wal-Mart asked for a 6 percent reduction in the price it pays for products based on its own cost calculation, while suppliers estimated the actual expense was equal to about 3 percent, the people say.

One side effect of the Wal-Mart plan is that consumer-product manufacturers may face increased transportation costs on deliveries to other retailers as they lose economies of scale on their own delivery fleets.

Suppliers may have to go along with the plan even if their other remaining transport expenses rise because Wal-Mart is so big.

The bottom line: By attempting to take over the transportation from its suppliers, Wal-Mart hopes to achieve efficiencies to cut its own prices.

Full article:
http://www.businessweek.com/magazine/content/10_23/b4181017589330.htm?chan=magazine+channel_news+-+companies+%2B+industries

Posted in Logistics, Mktg - Pricing | Leave a Comment »