Key Metrics and Supply Alert
Staff -- Purchasing, 11/17/2005
- Inflation is building in the factory pipeline, so the nation's manufacturing activity grew at a slower pace during October. Companies increasingly are feeling the strain of rising energy costs and some key raw materials prices. PURCHASING's monthly industrial index was 63.4, down from 64 in September, while the Institute for Supply Management's monthly manufacturing index was 59.1, down from 59.4 in September.
- Purchasing managers are rethinking supply chain strategies to combat increasing energy costs. According to an October survey conducted by Industry Directions of Boston, senior manufacturing executives believe that rising energy costs will change the way they conduct their business and are re-evaluating their operating strategies. That's why they want their purchasing directors and supply chain managers to find ways to minimize the burden of energy costs.
- There's a problem looming for many purchasing and materials management pros: What to do with the 250 million-plus desktop personal computer systems in the U.S. as businesses and consumers shift to laptops and notebooks. Disposal isn't going to be that easy since these units are considered to be sources of toxic waste. Cost is becoming a factor in plans to data-cleanse and remanufacture PCs and peripheral devices for re-use.
- chief executive officer Yun Jong-yong recently told analysts the company aimed to be one of the top three electronics companies in the world in quantity and quality by 2010 by increasing the number of leading market share products from the current eight to more than 20 products, and also by more than doubling 2004 sales. And some analysts agree: "I think it will be possible," said Minhee Lee, a senior analyst at Seoul-based CJ Investment & Securities. "Samsung has a diversified business structure—displays, semiconductors and digital media."
- Research forecasts notebook personal computer purchases of $120.3 billion in 2006, up from $95.5 billion in 2005. Sub-$1,000 notebooks are driving growth, according to Gartner analyst Andy Woo. Although desktop/notebook parity is a way off, he says 35% of units shipped now are notebooks, up from 10% five years ago. Purchasing growth is being pushed by widescreen (17-in.) notebooks, but price remains king. "This is a highly competitive industry, and the main driver is aggressive pricing," Woo says.
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