Archive for the ‘News’ Category

Sex toys at Swedish state owned monopoly pharmacy “Apoteket”

June 27, 2008

I was a little bit surprised when I just recently learned that the by Swedish state owned monopoly pharmacy “Apoteket” has started to sell what they call “sex and lust products”. Without arguing for the use or not of sex toys, I cannot completely relate these types of products to pharmaceuticals. Therefore I think Apoteket is taking advantage of their position of being a monopolist. They clearly have a good flow of customers due to being the only shops in Sweden allowed to sell pharmaceuticals. Now they will compete with a lot of small local businesses and maybe in the future bring these out of business due to the monopolist Apoteket having a better flow of customers and more purchasing power.

This, I would say fairly bold move by Apoteket, will also put new demands on their personnel. The shop staff must now be able to with good confidence argue for pro’s and con’s of the new items. Initially, I really doubt that all shop staff will be fully comfortable with that task. For the purchasing department they will have to learn the customer requirements and, competitors and the supplier market.

A clear advantage with this new product range is that it will make many people happier and who knows, maybe in a year or two, Apoteket has adapted to their competitors with more flexible opening hours and maybe even has dark windows and soft lighting.

Ken James gets the OBE

June 24, 2008

Ken James CIPSToday’s hooray (a tad late I admit, but none the less) goes out to former CIPS CEO Ken James who stepped down earlier this year since he now joins footballers David Beckham and David Healey (who dominated as the minute Northern Ireland shocked Sweden by winning 2-0 earlier this year), singers Kylie Minogue and Olivia Newton John and – my favourite – Olympic medallist Bradley Wiggins in the OBE (Order of the British Empire).

The Queens Birthday Honours List 2008 was revealed on June 14th and Mr James was his public service through leading positions at CIPS (Chartered Institute for Purchasing & Supply).

Turning Right is the Right Move for UPS

May 16, 2008

A recent article in Sweden’s leading daily; Dagens Nyheter (in Swedish); turned me onto this rather amusing (and ingenious I might add) supply chain story. As I dug into the story, I realized that it had been floating around for quite some time, but it’s still worth highlighting.

In 2007, UPS drivers saved 11 million liters (that’s about 3 million gallons for those of you who are uncomfortable with the metric system) of fuel by favoring right turns during their routes. Now, the turning right philosophy has been leading UPS for years, but recently they’ve developed new software to guide drivers; and recent reports for 2007 actually prove them right.

Commenting the amount of right turns a UPS driver makes in an ABC interview, industrial engineering manager Tasha Hovland at UPS is quoted saying: »A guesstimate, I would probably say 90 percent. I mean we really hate left turns at UPS«.

Now for all of the other drivers on the roads this might seem rather strange but planning the routes and avoiding left turns have cut route distance by 48 million kilometers (UPS estimates that this corresponds to 1000 less trucks necessary on the road); and at the same time idling has been minimized (especially in some US states where right turns on red are allowed). Accident risks are also lower, and carbon emissions are reduced.

High tech, low tech, call it what you will; it’s efficient and it’s saving fuel. For a company where fuel costs are 6 percent of their turnover, it proves that even the simplest innovations can become success factors. And to keep that chunk of cost down, this Monday UPS announced that they had placed the largest commercial order so far on hybrid electric vehicles.

Time to Move On?

May 9, 2008

As reported by Financial Times increasing raw material prices and labor costs in China will increase lap top prices. The world’s three leading contract manufacturers of Laptops – Quanta, Compal and Wistron -are now in talks with HP, Dell and Acer on how to move on the price increases to the consumers.

The first reflection on this is that this is all great news. Over the last 10 years we have seen the most dramatic reduction in world poverty ever. Hundreds of million of Chinese people have climbed over the line for extreme poverty (1 USD per day at PPP). World trade is driving increased salaries and the wealth in China is consuming a lot of raw materials making raw material prices to rocket. The rich and the middle income countries are now paying for the poverty reduction by adding some 100€ per laptop. We can afford it!

The second reflection is that the consolidation in the computer industry has now come pretty far and maybe we are starting to see some oligopolistic pricing? The numbers of both branded vendors and their contract manufactures are now much smaller than some years ago. And why are they all staying in China? Maybe they should move on to less expensive countries? In any event, there are still some vendors left and we as purchasers have to continue to keep the competition up. So here is the short list for your next RFQ: Acer, Apple, Asus, Dell, Fujitsu Siemens, HP, Lenovo, Sony and Toshiba.      

Introducing Gustav Hasselskog

May 6, 2008

One of the regular contributors of Purchasing Transformation is Gustav Hasselskog, SVP of Consulting for IBX Group AB. One of Sweden’s leading purchasing theorists, Gustav has more than ten years of experience from line management positions in various industries and prior to heading IBX consulting organization; he was responsible for product development and strategy at IBX.

Welcome to Purchasing Transformation

May 6, 2008

Good morning and welcome to Purchasing Transformation – a blog focusing on the power (and dare I say necessity) of change in purchasing.

As bloggers we’re not promising to be an all covering source of information; but we will try to do our utmost to find, analyze, and provide perspectives on all aspects of the purchasing profession; ranging from strategy to operational sourcing and procurement, covering organization and governance as well as technology for efficient purchasing.

The launch of this blog coincides with the release of Purchasing Transformation; the first book published by IBX. Purchasing Transformation is written in part by six of IBX senior consultants and promises to provide hands-on perspectives on change in purchasing.

Purchasing transformation can be ordered directly from IBX, or from Amazon.co.uk and Amazon.de.


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