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Consumer Products Companies Flunk the Working Capital Test
The 2007 working capital results are in. Once again, consumer products (CP) companies have flunked. This is the fourth consecutive year that the industry has underperformed against other industry sub-segments. Each year, CFO Magazine works with REL to publish the working capital scorecard, which ranks the working capital performance of the largest public companies headquartered in the United States. The analysis, based on prior-year annual reports, is a good barometer of year-over-year performance.
Consumer products fail the working capital test: This year, 57 industry segments were evaluated on working capital performance. Most of the sub-segments improved, with 61% showing year-over-year improvements and an average 8% improvement overall. In contrast, the consumer products (CP) sub-sectors of beverages, food products, and consumer packaged goods (CPG) all performed below the average.
Why the struggle? Many of the technology investments in the industry were justified by inventory reductions. Despite the fact that over 80% of CP companies have ERP and advanced planning and scheduling (APS) systems, they continue to underperform. Does this mean that technologies do not lead to a reduction in working capital?
No. Instead, it means that working capital reductions need more than technology. What is the basis of our conclusion? There are equal numbers of...
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'Sustainability Is Not Niche,' Says CEO of Coca-Cola
"First of all, we believe sustainability is critical, absolutely key," says John Brock, chairman and CEO of Coca-Cola Enterprises. "It's center of play. It's not niche anymore. It's not just something you kind of do when you're thinking about it. It's something we take seriously, and it has to be done all the time.
"We have a whole host of strategic priorities ... water stewardship, packaging reclaimability, reusability, recyclables, and then...
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Frozen-Beverage Manufacturer Jus-Made Deploys ERP, Accounting System from Deacom
Deacom Inc. says that Jus-MadeLP, a manufacturer and distributor of frozen beverages and juices, has licensed the Deacom Integrated Accounting and Enterprise Resource Planning Software System.
The company had used a "blended system" of multiple software programs to run its business, according to Deacom. Because the systems lacked integration, Jus-Made was required to expend a lot of labor to get information that wasn't always accurate. Sales were handled manually from order entry through shipment. Lot numbers were handwritten on batch tickets for...
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Sara Lee Joins Companies Moving Back-Office Tasks Offshore
By cutting 700 back-office jobs and outsourcing some finance positions, Sara Lee says it expects to save between $200m and $250m over the next three years, as well as gain more efficiency and flexibility. Some of these jobs were held by contractors.
As companies cut some finance jobs, they are offshoring others. Nearly half of the more than 350,000 back-office jobs...
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Daily Forecasting Tool Helps P&G Improve Service, Reduce Inventory
With a portfolio of 60,000 different products in 160 countries, forecasting and replenishing are major challenges for Procter & Gamble, one of the world's leading consumer packaged goods companies. David Mills explains how P&G is using a solution from Terra Technology called Intelligent Daily Forecasting to improve product delivery to retail customers and product availability to end consumers. The better data provided by this solution also has enabled P&G to reduce its inventory by 10 percent and to free demand planners from transactional tasks so they can focus on demand-shaping opportunities....
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Datalogic Scanning Issues QuickScan Imager With "Green Spot" Technology
Datalogic Scanning has made available the new QuickScan QD2100 Imager. The latest model features Datalogic's "Green Spot" technology for retail, document handling, courier and postal applications. The imager works on hard-to-read, poorly printed and damaged barcodes, according to the vendor. It is designed to read 1D codes and recently adopted GS1 DataBar linear codes. The small, lightweight unit shares the same...
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