Executive Briefings

Job No. 1 for CPOs Is to Manage Supplier Risk

The number-one priority for many chief procurement officers right now is managing supplier risk and making every effort to assure a steady supply chain to final customers. The weak economy and unprecedented credit crisis have combined to cause problems for many suppliers. At stake is their ability to maintain necessary lines of credit and finance the working capital necessary to run daily operations. Today's struggling economy is negatively impacting consumer confidence. Auto sales, for example, are at their lowest levels since the early 1980s. In addition, low consumer confidence drives down demand for general goods and services.
To compound the situation, high-priced material inventory is still in the market, delaying badly needed price relief. Most of the cost of raw materials has not been successfully passed on to the final customers, forcing more economic pressure to the bottom lines of suppliers across the globe.
Source: Inside Supply Management

The number-one priority for many chief procurement officers right now is managing supplier risk and making every effort to assure a steady supply chain to final customers. The weak economy and unprecedented credit crisis have combined to cause problems for many suppliers. At stake is their ability to maintain necessary lines of credit and finance the working capital necessary to run daily operations. Today's struggling economy is negatively impacting consumer confidence. Auto sales, for example, are at their lowest levels since the early 1980s. In addition, low consumer confidence drives down demand for general goods and services.
To compound the situation, high-priced material inventory is still in the market, delaying badly needed price relief. Most of the cost of raw materials has not been successfully passed on to the final customers, forcing more economic pressure to the bottom lines of suppliers across the globe.
Source: Inside Supply Management