Supply remains good, price increases slow
By Staff -- Purchasing, 5/6/1999
FEW BUYERS REPORT TIGHT MATERIALS AVAILABILITY this month, although the number has inched up from 2% to 5%. Still, 63% of buyers surveyed say materials availability is normal.Good supply availability may be one reason buyers are even more optimistic than in the past few months. Ninety-one percent of buyers expect business to be the same or better in six months time--that's up four points from last month, and the highest figure we've seen since April of 1998.
The inventory strategy for most buyers continues to be to "hold steady". Forty-three percent of buyers say inventories are the same compared with last month. However, 28% are actually increasing inventories, a jump of nine points from last month.
Just under one-half of buyers surveyed, (48%) report capital spending levels as steady. Thirty percent are increasing capital spending--up four points from last month.
Biggest buying problems:
Scheduling causes problems for buyers...and suppliers. One buyer admits that scheduling is a problem, but that's not due to suppliers. "Our in-house scheduling is horrible and causes nightmares for our suppliers," says a buyer in Indiana. Other scheduling problems pertain to dealing with minimum shipments, which several buyers cite as difficult to get just-in-time.
Items in short supply:
Buyers still cite titanium dioxide as in short supply. Others report problems with alkali blue pigment, natural petroleum, sodium sulfonates, oil-extended ethylene-propylene-diene monomer rubber (epdm). Several buyers report skilled workers as in short supply--a result of the tight job market.
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