With the economy still on the mend, economists are easy targets for humor. I wouldn’t doubt that many may even believe that an economist is someone who gets rich explaining to others why they are poor. The same can be said about supply chain industry forecasters who have wide ranging opinions on whether companies have learned their lesson from the recession. That point is clearly illustrated in this recent lessons learned article. The theme focuses on whether businesses will change their supply chain practices in a post-recession world. If the opinions are any indication, the answer is no, and maybe yes.

Have companies changed their supply chain practices? For years, the concepts of supply chain collaboration and visibility have been preached as the cornerstones of everything from inventory management to fleet maintenance. Yet, when you still have over 600,000 warehouses in North America without a computerized inventory management system, you realize that preaching isn’t the same as practicing. While it probably made sense for companies to upgrade systems and outsource logistics functions during the downturn, many did the opposite by bringing them in house. Even now in the post-recession economy when outsourcing functions is a prudent strategy for managing growth, companies are reluctant. On this count, the answer would be no.

On the other hand, companies are paying more attention to their business relationships. Undoubtedly, many long-standing relationships with partners were strained or lost in the past two years negotiating over a few dollars. With demand slowly edging back up, I believe many companies are approaching relationships with a stronger focus. In a post-recession period, establishing the right network is essential for any degree of success. So, in terms of understanding the importance of collaboration, have companies changed their view of what constitutes supply chain success? This one gets a tepid, slightly warm yes.

Where does that leave us? You have companies who understand the importance of collaboration, and I think more so than in the past. I see it in the number of inquiries from businesses who want to learn more about managing their inventory. There is a genuine interest in improving supply chain relationships through WMS, TMS and labor management tools among others. But, a hurdle for some is overcoming that hesitancy. So in short, the answer to whether companies have changed their supply chain practices comes down to this—not until they overcome their fears.

A few days ago, I ventured along the waterfront whose route took me along the Port of San Francisco. The port by the bay has certainly seen better days, and many of the buildings that once housed bustling canneries and fishing outposts are now mostly populated by tech startups and restaurants. These days, port activity is more of an afterthought, if thought about at all, for most people. Honestly, I likely wouldn’t give it much thought either if I weren’t in the logistics industry. The reality is that port activity can provide a clear snapshot of the economy and its direction.

Port traffic in the key regions across the states has seen marked improvement supplemented by jobs. For example, Los Angeles saw imports rise 32% and exports by 13% from last year, while Long Beach experienced increases of 27% and 2%. These numbers point to several things: a significant rise in traffic, increased hiring in dock workers, and a rising trade imbalance. Container volume also saw increases on the East Coast with New York/New Jersey seeing a 17% increase in 20-foot containers, while Savannah was up nearly 25%. Keep in mind that the numbers are all still lower than those before the recession, but they’re certainly better than last year.

An economist will talk about the multiplier effect which is what you hope for when it comes to positive growth. Inventory and trade levels go hand in hand because as one increases, more than likely so will the other. And with the increased hiring of dock workers, so does the number of other logistics-related jobs. Of course, at the end of this supply chain is business and ultimately, consumer demand that will determine the degree and sustainability of this growth. This country isn’t out of the woods yet with lagging overall unemployment and tight-fisted credit still major concerns, but the recovery signs are there.

Now, all you need is a plan to take advantage of that recovery and help it along.

There’s a saying that says your product has made it once it’s been counterfeited. If that’s the case, then the Amazon Kindle may be an overwhelming success. Not to make light of an ever increasing problem that costs companies billions of dollars and a significant loss of jobs annually, but fake Kindles are making the rounds. The fate of the Kindle is no aberration, and serves as yet another example in the annals of offshore sourcing and fakery.

Don’t misunderstand my perspective—offshore sourcing is a strategic and in many cases, essential part of a company’s business strategy. For better or worse, the world’s different economies rely on it to ensure productivity, demand generation, and profitability. But with the benefits of offshoring come significant risks, and the Kindle is the latest example. When establishing supply chains overseas in low-wage countries, the security of intellectual property is vulnerable. Whether products are copied or specs are “borrowed”, the integrity of checks and balances usually doesn’t pass with flying colors.

And, the proof is right in front of us via the World Wide Web. All you have to do is look on electronic bulletin boards and Internet forums where products are bought and sold to get a glimpse. Just take a look at the country of origin of the seller along with the typical below market price tag, and chances are you’ve stumbled onto something.

Not that the IP risk doesn’t exist when dealing with domestic suppliers and partners, but oversea regulations and enforcements tend to be lax depending on the geographical and economic demographics. Besides counterfeit name brand apparel and merchandise, we’ve seen this with music CDs and movie DVDs, computer software and hardware and just about anything you can imagine.

According to the ARC, “counterfeit goods make up 5-7 percent of world trade…the International Anti-Counterfeiting Coalition (IACC) and the US Federal Bureau of Investigation estimate that counterfeiting and piracy cost the U.S. economy between $200 to $250 billion per year, contributing to the loss of approximately 750,000 American jobs."

While anti-counterfeiting tools are available, they alone can’t address or even solve all the problems. In fact, the best approach begins with assessing a multitude of things including corporate policies, training and the supply chain. Of course, combating fakery or not, when it comes to the supply chain, the basics are what matter: visibility and accountability. And regular communication and collaboration with partners wouldn’t hurt either.

As countries evolve economically, competitive advantages change which may be what is now happening to China’s manufacturing industry. Earlier this month, I wrote about how the rising number of worker stoppages at China-based factories and how this was a potential sign of things to come for U.S. companies. It’s becoming more obvious that the cheap “Made in China” era may soon be coming to an end.

For more than two decades, China (along with Japan) had the monopoly on cheap manufacturing due to a large labor force and low wages. I remember during the 1980s when the mass migration of manufacturing overseas from the U.S. took place to fuel the growing demand of goods. At the time, the highly educated U.S. consumer had the money and resources to buy, while China was more than happy to meet our needs at a cheap price. It changed the economic fortunes both here and abroad with lasting effects that continue to impact us today.

Evolution, progress, advancement…whatever you call it, China on the backs of low-cost, high production factories has grown up to be an economic powerhouse. Along with that, you have a labor force that is as highly educated, if not more driven by material wealth, than we are here. Ironically, it’s likely to come at the expense of the manufacturing sector.

While still inexpensive compared to American wages, the cost advantage that China offered is shrinking. American companies are finding the advantages of outsourcing production to China offer few financial benefits. In fact, labor disputes, a restrictive business environment and a floating yuan all make China less appealing. To elaborate on the labor disputes a bit, the typical Chinese factory worker is much more educated and ambitious (you can see that in the red hot demand for housing over there). Those attributes make factory workers less willing to accept low wages and substandard work conditions. Why would they when they have plenty of options and better opportunities? This changing demographic is nothing new when you look at the history of the U.S. economy and its development since the Industrial Revolution.

For U.S. companies, the time is near to take stock of the long-term production strategy. Outsourcing remains a viable option, but as Honda, Toyota and Apple can attest, “Made in China” may not have the big financial allure it once had over “Made in USA”.

Just the other day, I was thinking about that classic (is it old enough to qualify as a classic yet?) end-of-the-world flick “Outbreak” that features Dustin Hoffman running around mostly in a jumpsuit. Basically, an infected primate is inadvertently captured abroad and brought to the United States. As you can guess, this has a major impact on the residents of a local town. Along with the drama and expected storyline, the movie provides a good illustration of how easily events can spiral out of control.

Ironically, current events with Abercrombie & Fitch provide a mini case study of how a weak link somewhere in the supply chain can have almost disastrous effects not only for revenues but on public perception. Just last week, bedbugs were found to have infested the company’s Hollister Street location in New York and a few days later, the South Seaport store. Even now, the infected stores have yet to reopen. Customers who recently made purchases at A&F, especially at those locations. have to be equally worried, paranoid and grossed out.

From a supply chain perspective, the bigger concern is the origination points of shipments to the stores. Chances are that the blood sucker contamination came from somewhere in the supply chain at a warehouse, loading station or even delivery truck. (If the contamination occurred individually at the store level, that raises an entirely different and even more worrisome story). I’m sure that A&F maintains a certain level of quality and standards within its operations. But this situation demonstrates how susceptible any organization is to a breakdown anywhere along the supply chain.

While inventory visibility may not have prevented the spread of bedbugs in the first place, having the tools to now track down every person and location will limit the potential for a recurrence. If I’m an A&F supply chain manager, my primary task is to track down the source—having a WMS in place would make that much easier.

From a public relations standpoint, it’s certainly a crisis since this puts a dent in the credibility of A&F’s reputation for quality. As we’ve seen in the past with recalls for example, the customer-facing company is the one that takes the financial and reputation hit. For the suppliers behind the scenes, the financial impact alone can be devastating.

Still think supply chain disruptions only happen to others? Like “Outbreak”, the ramifications can be widespread and just as damaging.

For years now, the focus of environmentalists, businesses and consumers has been on oil and the development of alternative energy sources. But yet another risk to the supply chain is looming but to date has received little attention—rare earth minerals (REE).

REE are the materials—dysprosium, terbium and neodymium—that make most of our high-tech products from cell phones and computers to electric cars and solar panels work. The gist is that these compounds create and facilitate the processes and reactions so for instance, automobiles run and cell phones dial and answer. REE aren’t rare at all, and actually pretty abundant in nature. The problem comes from the mining process which is expensive and environmentally destructive. Like oil, the U.S. imports these materials from China, and they’ve begun to put up restrictions that may have detrimental effects on this country. For trivia fans, China is the world’s biggest supplier of key REE, accounting for more than 90 percent of global production. Not to overstate the point, but our green initiatives and technology progress depend on REE.

While it’s been encouraging to see the growing use of electric cars and cleaner burning fuel, alternative energy still has a ways to go before we cut ourselves off of foreign oil. REE may be in a slightly worse state of affairs since we really don’t have any immediate and long-term alternatives. Now, the Mountain Pass mine in California’s Mojave Desert does have an abundance of REE, but we have yet to develop an environmentally safe way to mine it. In the past, mining at the site created radioactive waste and negatively impacted the environment.

As with the Middle East, China understands the hand it has and will likely use it to its advantage in the business and political arenas. The U.S. is in a difficult situation because this obviously impacts the health of the technology supply chain over the long haul. As most of us in the supply chain industry can attest, problems are best addressed through balance and compromise.

But first you have to understand that there’s a problem—the sooner, the better.

Over the past several weeks, encouraging news has emerged for some of us in the supply chain business and should have many others wondering if they’ve planned accordingly. The media tends to focus on the doom and gloom, but let’s focus on a few bright spots and opportunities that signal the better times around the corner.

Retailers have been on an emotional roller coaster trying to balance prudent business decisions with inconsistent consumer demand. In fact, many would rather forego sales rather than run the risk of carrying too much inventory. Frankly, I think that’s an overly cautious strategy that illustrates poor planning and inadequate forecasting in inventory management. There are far too many tools available where leaving money on the table is simply not an option. For example, collaborative flowcasting provides a high-level of visibility so that changes at the store level are immediately visible to the manufacturer. I’ve often talked about the importance of collaboration between partners, and this degree of visibility reduces stockouts and overstocks while boosting customer satisfaction.

Another sign of a recovering economy is the auto industry. Last week, General Motors announced that the company would forego its usual summer shutdown at nine of its eleven plants meaning more supply and even hiring temporary workers. Toyota is also wrapping up its construction of a new plant in Mississippi that will employ 2,000 workers by next year. In addition, Toyota’s latest investment in Silicon Valley-based Tesla should provide additional jobs as the former NUMMI plant gets restarted in the next few months. Tesla’s IPO today will also provide additional capital for expanding operations and R&D for the luxury electric vehicles. For suppliers to the auto industry, the main concern is whether or not they have the capacity to meet the demand.

Not to be outdone is the healthcare/pharma industry. A Harris Interactive survey of 150 pharmaceutical, biotech and medical and surgical device companies found that 35% plan to increase supply chain outsourcing over the next two to three years. Financially, the healthcare/pharma industry needs to continue reducing costs, and outsourcing provides significant savings relatively quickly. If you’re a logistics provider that, for example, can provide healthcare-compliant, cold and frozen storage capabilities, then you’ll likely be receiving some phone calls soon.

While many are still dealing with the aftermath of the recession, companies need to start looking at innovation in this recovery. It’s no longer enough to conduct business as usual…the same was true during the recession, and much more so now. Businesses that leave money on the table or miss out on new opportunities will only accomplish what the recession didn’t.

Disruptions in the supply chain are not uncommon whether they are due to human influences or Mother Nature. China hasn’t been immune to these types of disruptions, but as of late, these have typically been due to production quality issues—until now. The economic success may finally be catching up as the cheap labor force there may no longer be so cheap. In the past two weeks, worker stoppages at supplier factories have been severe enough to halt auto production at Toyota and Honda plants. Could this be a sign of things to come? It’s definitely worth close attention as the busy season starts and the floating Yuan goes into effect.

China’s labor force is the largest in the world, and with such a large pool, worker salaries are low ($191/month for the average worker at an auto parts supplier). A few weeks earlier, a factory owned by Foxconn which manufacturers Apple iPhones also came under scrutiny for the long hours and questionable working conditions employees faced, not to mention a slew of worker suicides.

In the past, China’s rather passive labor force has led to low priced China-made goods here. But as Japanese automakers are discovering, times are changing. Until the Chinese government enforces uniform labor regulations to ensure fair wages and better working conditions, work stoppages will likely be commonplace. For now, the stoppages have been minimal, but labor movements tend to spread like wildfire. China’s dominance as a cheap production base won’t change anytime soon, but it’s obvious that the country’s competitive advantage is having growing pains.

Aside from the labor woes, the decision to sort of float the yuan will have its share of benefits and consequences for China—too many to go into here. I say sort of because questions remain on how much “floating” China will actually allow. But for argument’s sake, let’s assume a real floating currency. As the yuan appreciates, the price of goods from electronics to clothing for the average consumer will almost certainly go up. For the U.S., this would be a good scenario because production would come back here (because of the higher transportation costs to China) and boost demand for imported goods.

Whether or not your company conducts business in China, the role of the underappreciated supply chain manager just became a little more interesting. Prepared or not (hopefully you’re prepared), the changes in China will undoubtedly impact us all.

Here we are near the midway of 2010, and many of us are still struggling to get a grasp of this economic recovery. Plenty of different government reports are available and depending on which one you happen to come across or the day, you’d be hard pressed to come up with a solid bet. Of course, the best measurement is the state of your own financial life because that’s ultimately the only gauge that matters.

From a business perspective, that’s why the Gartner annual supply chain study is especially interesting, if not redundant this year. Why redundant? Frankly, the same obstacles that have hindered survey respondents in the past continue to be same obstacles this year. The three top barriers preventing companies from achieving their supply chain goals are forecast accuracy, supply chain network complexity, and lack of internal collaboration and visibility.

This begs the question “What are companies actually doing when these are the same issues every year?” It’s a fair and valid question because you would assume that organizations regardless of size gradually improve their business processes over time. In many ways, the study highlights how many companies continue skate on thin ice putting off implementations today that likely will cost them revenue or their businesses in the long term.

Even more telling is where companies stand in the adoption of supply chain applications. As SC Digest points out, the top application deployed was warehouse management system and “even that was fully deployed by only 39% of respondents.” Obviously, it’s no wonder the lack of internal collaboration and visibility is a top three barrier when 61% have yet to fully deploy a WMS. Supply chain planning (32%), sales and operations planning (29%), and transportation managements systems (28%) round out the list. Yet, these applications have been available for years if not decades.

The objective of studies is to show the state of things. Well done studies such as those distributed by Gartner provide insight with a call to action. Hopefully, the next study demonstrates the progress from that call because the industry needs it.

Inventory is an area that businesses of all types deal and struggle with on a regular basis. Regardless of whether you’re dealing with items such as office supplies that are used internally to equipment sold to customers, that is inventory. Typically we manage inventory as it travels within the supply chain or as it sits in a facility in order to reduce costs. But, avoiding unnecessary and extra inventory in the first place is probably the most effective and fastest way to see results.

Common sense tells us that extra inventory is eventually sold or jettisoned, but the time before that happens can be costly. When you hold inventory, it’s a cost that ties up capital, wastes valuable storage space and ultimately impacts the bottom line. Rick Pay provides some food for thought in his article discussing the importance and tools for avoiding obsolete inventory. The fundamental message here is that advanced planning now can save plenty of money and frustration down the road.

Sales and operations planning is the most basic approach for any management professional connecting operations capabilities with demand planning. In other words, more accurate forecasting based on customer demand can reduce, although probably not completely, eliminate obsolete inventory. The problem is that companies tend to overestimate the demand for new products, and as with life in general, it’s a balancing act.

Auto-replenishment systems, as the name suggests, automatically refill inventory which reduces stockouts and improve inventory accuracy and turns. Think of this as a watered down version of just-in-time inventory that can cut lead time. These types of systems require strong monitoring oversight to ensure accuracy because as Rick points out, an overzealous salesperson may aggressively replenish stock to meet end-of-quarter numbers resulting in excess and obsolete inventory.

The Ramp-up/Ramp-down approach involves close and consistent collaboration at all levels ranging from product design through the sales process, introducing new products and phasing out older ones. During the ramp-up phase, buyers should carefully monitor results to determine if sales are meeting the targets and communicate closely with suppliers to update plans frequently and set appropriate restocking levels. The ramp-down phase requires a bit more planning because it involves the slowdown or gradually shrinking demand of older products. What happens often is that companies continue to order older products without a clear gauge of customer demand which in turn takes away resources from newly introduced products.

Avoiding obsolete inventory is an insightful, yet practical perspective to consider. Many organizations tend to think about inventory as something after the fact (“what do we do with the excess inventory?”), and we’ve all seen the pricing promotions that follow. While not necessarily a bad thing for customers, excess inventory and low prices are loss leaders for organizations that consider it business as usual.

Today is the start of Apple’s World Wide Developers Conference here in San Francisco, and we all know that Steve Jobs always gives fans something to get excited about. The Apple iPad, (and you can probably now add a newly revamped iPhone to that list), has no doubt become the runaway hit this year selling more than 2 million units in less than two months. Analysts are already predicting sales to exceed 6 million for 2010.

Of course, the degree of success heavily depends on the supply chain especially in Apple’s case. AMR Research recently published its Supply Chain Top 25, and Apple was named the #1 company for a third consecutive year. The list is determined based on a number of variables including ROI, efficient SC management, revenue growth and peer feedback.

All you have to do is look at the impact of the iPhone on the ultra competitive mobile device space and Apple’s ability to provide an ample supply of product worldwide. From overseas manufacturing facilities to its retail outlets, Apple has shaped and redefined the consumer experience, and the iPad is a further extension of that by targeting digital content.

On the flip side, Apple’s success can also be its Achilles Heel. The significant growth and demand for electronic components and touchscreen technology across the industry may be the only thing that can dampen that success. Touchscreen shortages are nothing new, and in fact, has been an issue for a number of years. Blackberry had similar issues surrounding the launch of its Blackberry Storm two years ago, but with the pervasiveness of touchscreens today and newer and better iPhone to boot, it’s undoubtedly now a bigger issue. This is even more of an issue for the iPad since the touchscreen is much larger at 9.7 inches and developing sufficient quantities will be difficult. Combined with the usual shortages surrounding semiconductors and other components, and you see where this could be headed.

This is an industry-wide problem and not an Apple-only one. Apple has always been a master of its supply chain, and it’s been able to handle the demand thus far for iPhones and iPads alike with minimal problems. But what do you do when the issue isn’t about efficiencies but more about availability within the supply chain? Let’s just say I wouldn't bet against Apple retaining its #1 ranking for a fourth straight year.

Prior to this year, cadmium was not a word common in everyone’s vocabulary. And, if you somehow managed to steer clear of it earlier in the year, there’s no avoiding it now especially when McDonald’s and Shrek are involved. In May, McDonald’s did a promotion tie-in at its restaurants for the new Shrek movie and offered individual drinking glasses with Shrek characters for a nominal price. Those 12 million glasses are now being recalled because the paint used in the decorative designs contains cancer-causing cadmium.

The glasses illustrate the complexities of today’s supply chain. First off, the glasses were manufactured here in the U.S., which initially doesn’t set off any red flags. Second, McDonald’s actually had the glasses tested at an independent lab for safety prior to release which turned up nothing irregular. On the surface, McDonald’s appears to have done everything correctly even in the expediency of issuing a recall.

So why are millions of glasses being recalled? This is where the complexity of the supply chain comes in. The U.S. facility that manufactures the glasses are owned by a company in France and the materials used in the production process could have come from a number of other countries. The cadmium paint (used in reds and yellows) likely was produced outside of Europe, and hopefully the source can be traced. We all know how industry and health regulations can differ widely abroad, which becomes a problem in this global supply chain.

Another factor to consider is fear. Cadmium-related fears were an issue earlier this year when it was discovered in children’s metal jewelry sold at major retailers. Combined with the growing sensitivity, any level is inexcusable at this stage. But, would low levels of cadmium “within accepted standards” have been brushed aside before the jewelry situation?

For companies such as McDonald’s, the reliability and credibility of those in the supply chain is critical because it doesn’t take much to disrupt it. One slip can result in missed revenues, damaged relationships, and most importantly, lost goodwill. While McDonald’s reputation will likely weather the situation successfully barring any major revelations, its crisis management team would probably prefer not having to go through this drill again anytime soon.

The U.S. Commerce Department today reported that factory orders rose 1.2% in April, the eighth consecutive month that has occurred. Although not stellar, the rise is still an encouraging economic sign as the business environment slowly improves.

For those of us in the inventory business, the more telling statistic is that factory inventories rose for the second month at .5% with an inventory-to-sales ratio of 1.24 months (manufacturers had enough goods on hand to last 1.24 months at the current sales pace). This indicates several things with the most obvious being that excess inventory has been cleared out. One of the biggest issues during the recession was the huge levels of inventory which exacerbates revenue losses and inhibits capital investment.

The ship seems to have righted itself, but manufacturers face the dilemma that inventories may be too low. For many, it’s probably a nice problem in comparison to what they have had to deal with the past 15 months. The basic question is “Are manufacturers better equipped now to make those inventory decisions?” The answer comes down to the roots of excess inventory which is often tied to bad management. But that’s an inexact statement. Of course, other variables exist that are essentially out our hands such as the European debt crisis and the overheated real estate market in China. But, arguably, many of the ineffective management decisions made in the supply chain are often due to bad data.

I’m sure many of us have made less than ideal decisions because of inaccurate or incomplete information. That doesn’t inherently make us bad managers, just ill informed ones. Really, the more important question is “Are you smarter and wiser now than you were last year at this time?”

Taking things for granted is something most of us do every day in the supply chain. Whether we’re talking about customers or simply ignoring what we think are minor issues. Unfortunately, because the supply chain is a living organism, it takes very little to cause some big problems and create a domino effect on those connected to it.

The shortage of traffic paint—yes, traffic paint—may put a damper on the construction business, according to the Associated General Contractors of America. If your town or city is anything like San Francisco, then you’ve seen an upswing in construction crews blocking off streets and orange cones dotting the roads. The acute traffic paint shortage, however, has the potential to derail it all for one simple and obvious reason: you can’t drive on roads that are unpainted and have unmarked lanes. (Separating northbound and southbound lanes for example tend to be important).

Road paint contains methyl methacrylate, a chemical that gives paint the longevity and its reflective property. Dow Construction Chemicals and Aexcel, producers of this cement magic can’t produce enough of the stuff to the point that construction projects are being put on hold. Manufacturers and local/state jurisdictions are scrambling to find paint alternatives. The long-term implication with putting a hold on construction projects is scaled down production that could hamper the recovery.

When you dig deeper, traffic paint highlights a bigger problem: the inability to collaborate with suppliers. Production problems at Dow created the shortage, but you’re unlikely to find anyone who knew anything about it until the mad scramble for paint began. We had the same thing happen earlier in the year with Eggo Waffles when production problems made ripe the conditions for empty Eggo shelves. Considering the federal stimulus money that’s been pumped to jurisdictions across the country and the baby steps of an economic recovery, you certainly hope that paint doesn’t become the albatross.

The next time you take a bite out of a candy bar, you may inadvertently be harming the rainforests. Think that’s far-fetched? When it comes to the supply chain, nothing is ever obvious or straightforward which is what Nestle Company discovered with palm oil.

From Kit Kats to Oreos, palm oil is a common ingredient used in processed foods and is extracted from the fruits of palm trees. The environmental impact is that a significant amount of these trees are being cut down in the Indonesian rainforests which releases high levels of carbon dioxide and threatens the habitats of orangutans.

Under pressure from Greenpeace and a growing Facebook campaign, Nestle has partnered with the non-profit, The Forest Trust, to clean up its supply chain to ensure that all of the palm oil it uses comes from sustainable sources. Companies including Kraft and Unilever have also pledged to improve their sourcing of palm oil. One obstacle to this admirable goal is that palm oil comes from different sources and tends to get mixed together, making it difficult to trace back to the plantation. Seriously, ask any company to source their products, and many would have some difficulty especially with food-related ingredients and products.

Supply chain visibility is never an easy task, but it’s not impossible either. An initial framework would include a transparent procurement and inventory management system combined with enforced purchasing requirements when dealing with suppliers. Add to that a platform for collaborating with partners (e.g. suppliers), and you begin to see an effective sourcing model. Regardless of company size, it doesn’t take much to disrupt your supply chain, but it also doesn’t take much to protect it either. The issue comes down to having the basic tools to see what’s in your supply chain. If you have that, then you’re off to a good start.