While diesel is seeing the disruption that we discussed last week (and my daughter in Houston is ok – thanks to those who asked), the longer term may be different…”A poll of 14 investment banks, surveyed by The Wall Street Journal at the end of August, predicted that Brent crude, the international benchmark, will average $54 a barrel next year, down $1 from the July survey.”

 

I am no marketing genius, but food brands don’t seem to be worth as much as they were before.  Wal-Mart, amongst others whom Amazon probably spooks, is pushing grocery manufacturers to cut prices on their brands.  Campbell’s held the line with one retailer (rumored to be Wal-Mart).  Their stance cost them 8% of their stock price when they said they could not come to an agreement about promotions.  It’s the Amazon effect and the drive to “generics” and “organic”.  Kroger boasted that customers have become loyal to the company’s store-brand natural goods.  Last year, shoppers spent $16 billion on those products and natural and organic goods, representing about 14% of the company’s total sales.  As supply-chain managers, we must adapt!

 

One way to adapt is to increase load size to cut cost…here is a new way to save in situations where there is no space in the plant, and it is necessary to ship directly from the line.  Take a look at this animation –