Purchasing Compensation Continues to Grow!

By Susan Avery -- Purchasing, 12/17/2009 2:00:00 AM

Results of Purchasing's 29th annual salary survey show that compensation rose 6.9% to $94,317 in 2009, up from $88,206 a year ago.

These findings reflect top management's recognition of purchasing's leadership role in controlling costs, and increasingly, at initiating activities that help add to the bottom line.
They also demonstrate that purchasing continues to draw professionals to the field who are experienced, well-educated and aren't hesitant about taking on increasing responsibilities, traits that tend to command higher levels of compensation.

Purchasing is not alone in reporting such spectacular results for the profession, despite the recession and an unemployment rate that has topped 10%. The Institute for Supply Management (ISM) conducted a survey of its members earlier this year that also shows salaries climbing—6.8%.

Compared to their peers in other related professions, purchasers are faring well. They are better compensated than engineers and logistics managers and are enjoying salaries that are growing at a faster pace. Results of a reader survey by Design News magazine shows compensation growing 4.5% to $89,748, while a Logistics Management survey finds its readers finally saw salaries grow 5.9% to $85,000, after falling in 2005, then remaining stagnant for two years. These magazines, along with Purchasing, are all published by Reed Business Information.

"Purchasing is doing all the right things to position itself," says Phil Krotz, director of supply chain services at Rockwell Collins in Cedar Rapids, Iowa, and a survey respondent. He says that the supply operation at his company, which received Purchasing's Medal of Professional Excellence in 2005, is meeting more often with president and CEO Clay Jones as the economy recovers and is now involved in new initiatives that help the company improve inventory levels and cash flow.

"More CEOs are bringing purchasing to the table, asking, 'where can you help us?'" says Russ Boyd, senior procurement and contracts specialist with Perot Systems in Plano Texas, and a survey respondent. He sees purchasing taking on a bigger role in such non-traditional areas as risk mitigation at their companies. "We've always been involved to a degree in supplier risk, but now we are paying more attention to the financial aspects of risk."

Purchasing professionals responding to Purchasing's salary survey this year fall into a demographic profile of professionals who earn salaries generally higher than the average. Survey respondents work for big companies (with over $500 million in annual sales), have many years of experience and manage larger spend categories (over $50 million). For the most part, they have supervisory responsibility and work in senior management positions in corporate purchasing operations. They have graduate degrees and hold professional certifications.

One respondent, for example, is the CPO (corporate procurement officer) at an energy company with more than $3 billion in annual sales. With 30 years of experience, he holds a technical degree and is responsible for more than $500 million in annual spend; one of the more important categories he manages is services. He earns a salary of $700,000, with bonus.

More respondents work in the process and energy/mining and utilities industry sectors than in previous years. These sectors tend to provide purchasing pros with positions that are well paid. On average, those working in the process industries earn $109,687, with those in energy/mining and utilities seeing yearly paychecks of $107,750.

Purchasing professionals who toil in manufacturing, an industry particularly hard hit by the recession and the high unemployment rate, on the other hand, saw average annual compensation fall in 2009. Purchasing salaries in the wholesale/durable goods industry sector declined $4,042, while compensation decreased $1,830 for purchasers in the automotive/transportation sector.

"Purchasing has been able to increase salaries significantly over the past 20 years because they've made the function a core part of the business," says Tonia Deal, president of Tonia Deal Consultants in Hudson, Ohio. "Still, there is some great talent on the market because of the economy and all that has happened. For instance, in the auto industry, there are people who were earning more than $100,000 taking positions paying in the 90s and looking to make up the difference with bonuses."

Deal says purchasing operations became leaner this year with companies hesitant to move on higher level director and CPO posts, opting instead to fill the roles internally. "And there are purchasing professionals who were managing $100 million in spend now responsible for spends of $300 million," she says.

Kevin Rohan, director of procurement recruiting at J.P. Canon Associates in New York, says that while hiring was down considerably in 2009 compared to previous years, there were companies that were hiring selectively. "In the beginning of the year, we saw companies freeze merit increases and annual reviews, eliminate bonuses or reduce them significantly and suspend pension and 401K contributions," he says. "Layoffs and hiring freezes meant longer hours and heavier workloads for employees.

Retention of top performers was a priority for many clients who found it more cost effective to give pre-emptive increases or promotions, but to fewer employees." But many companies also took the opportunity to strengthen and improve their purchasing operations, with hiring occurring in the pharmaceutical/healthcare, consumer products and financial services industries.

Positions Rohan worked to help fill in the past year include those with responsibility for these spend categories: raw materials (chemicals), packaging, technology (IT hardware/software/services), contract manufacturing and MRO/facilities/capital equipment.
Even with the recession, he says there were some roles that were difficult to fill, especially those that require chemical engineering or technical backgrounds.

Coincidentally, salaries for purchasing professionals with degrees in these areas saw some of the greatest increases in compensation, according to results of Purchasing's salary survey.

Bargaining for bonuses...
Bonuses have always been an important part of compensation packages earned by purchasing professionals responding to the salary survey. This year, a slightly smaller percentage of respondents (62%) got bonuses compared with last year (64%). Still, the amount of bonus is the same (14% of salary).

The bonuses are based on meeting company financial goals for 66% of survey respondents. Other criteria for receiving a bonus include progress toward product development cost targets (for 21% of respondents), cost targets for purchased parts (for 18%), supplier quality improvements (8%) and cycle time improvements (6%).

Rohan at J.P. Canon reports that companies in the pharmaceutical/healthcare, food and beverage and financial services industries all paid bonuses in 2009. Bonuses, he says, "are especially important now as they are a good sign of a company's financial health."
Respondents to the salary survey also receive stock options (17%), with a median value of $11,000. Last year, 16% got stock options, with a median value of $9,000.

While the percentage of salary survey respondents receiving bonuses as well as the amount of the bonus has changed little in the past year, purchasing still is doing better than other professionals. Results of a recent survey of 1,156 large organizations by Hewitt Associates, a human resources consulting and outsourcing company in Lincolnshire, Ill., show spending on variable pay (bonuses) as a percentage of payroll for salaried exempt employees in general was 12% in 2009. For 2010, companies are budgeting variable pay bonuses at 11.8%.

"Even in the toughest economies, companies are willing to reserve money for top-performing employees as a way to reward performance and ensure they retain these employees after the job market rebounds," says Ken Abosch, leader of Hewitt's North American broad-based compensation consulting business.

Data from the Hewitt survey show base salary increases for all professionals averaged in 2009 were just 1.8% and are expected to rise to 2.7% in 2010. Industry sectors expecting above-average salary increases in 2010 include energy (3.7%) and food/beverage/tobacco (3.1%). Industry sectors with the lowest expected increases are industrial machinery/equipment (1.2%) and automotive/vehicle manufacturing (1.2%).

2010 outlook...
Already Deal at Deal Consultants sees some pick up in hiring among companies, especially in the consumer products goods industry. "These are companies that had positions on hold for over a year that are finally moving forward," she says, adding that purchasing professionals looking for work will see more activity starting up after the holidays.

Rohan at J.P. Canon notes an uptick in hiring of purchasing and supply chain professionals since August, especially for temporary positions. He also sees increased activity from management consulting companies. "We anticipate that hiring will continue to improve in the first and second quarters of next year and that hiring criteria will continue to be comprehensive," he says.
"The expectation of most hiring managers we have worked with this year is that the selected individual will have prior industry experience, expertise in the managed supplier base, appropriate systems knowledge, and be able to deliver a result right away," he says.

Echoing these thoughts on qualities companies look for in purchasing professionals is Brent Shinall, vice president, global supply chain, at Helix Energy Solutions Group in Houston, who says that negotiation skills are always at the top of the list of what he looks for when hiring an individual for his team. "But I would take it a step further than that," he says. "At Helix, we are leaders of projects and sourcing initiatives, so we like individuals who are not afraid of that role." Many of the purchasing pros on his team have technical degrees.

According to the Bureau of Labor Statistics Occupational Outlook Handbook, 2008–09 Edition, a bachelor's degree, combined with industry experience and knowledge of a technical field will be an advantage for those interested in working in purchasing at a manufacturing or industrial company through 2016. It reads, "Demand will be stronger for purchasing in the services sector as it grows more rapidly than manufacturing."

Still, the BLS shows employment for purchasing growing more slowly than average for other functions. Work purchasing has done over the past few years to automate processes has helped to take the function from tactical to strategic—and raise compensation levels, but it has also put a damper on demand for new hires, because it now takes fewer people to do the work.

Trade Deficit Narrowing!

The trade deficit narrowed in October, suggesting that an export-powered U.S. economy could expand at a faster pace in the fourth quarter. The trade gap fell to $32.9 billion as exports rose 2.6% -- the sixth straight monthly gain -- with trade activity continuing to recover from deep declines seen during the financial crisis.

Imports rose 0.4%, partly reflecting lower oil imports.

"U.S. exports appear to be improving much faster than the domestic economy, suggesting that much of the improvement seen in the manufacturing sector reflects strengthening economic conditions abroad and the impact of the weaker dollar," said Nomura Securities economist David Resler.

Stronger-than-expected net exports lifted growth prospects for the current quarter. The forecasting firm Macroeconomic Advisers raised its estimate for fourth-quarter growth to 3.8% from 3.4%.

“A narrowing of something as fundamental as the trade deficit is indeed good news. It seems too much to hope for, but with a little luck, and restraint among US consumers, it will continue to close”, relates Vincent P. Emmer.

Exports appeared to have hit their bottom during the spring, but they remain 8.6% below their level of a year ago and substantially below their peak in the summer of 2008. The weak dollar and a rebound in global demand are boosting U.S. exporters' activity, offering some hope amid lackluster demand at home.

For instance, U.S. coal companies that export metallurgical coal used in steelmaking are seeing an upswing in interest from European buyers, as China's appetite for coal is eating into more of the world's coal supplies.

Alpha Natural Resources Inc. of Abingdon, Va., expects its exports of such coal to Eastern and Western Europe to rise to between 10 million tons and 12 million tons next year from seven million tons this year.

Other companies said they were seeing more export opportunities. "We continue to see genuine interest primarily into the export market," said Deck Slone, vice president of investor relations at Arch Coal Inc. of St. Louis. "There are indications that deals are getting done in Asia for U.S. metallurgical coal."

In October manufactured-goods exports were 2.8% higher than in September, with capital-goods exports rising 3.7% over the month, according to the National Association of Manufacturers.
"The fact that 21 of the 32 capital goods categories showed growth indicates that the export recovery is broadening," Frank Vargo, a vice president at the trade group, said in a statement Thursday.

States Friendly to "Small Business"!

A new ranking of state public policy climates for small business and entrepreneurship by the Small Business & Entrepreneurship Council (SBE Council).

The 14th annual report, the "Small Business Survival Index 2009: Ranking the Policy Environment for Entrepreneurship Across the Nation,” is intended to measure which states are “friendly” to small business, and which are not, in terms of public policy decisions.

The index takes into account taxes, regulatory costs, government spending, property rights, health-care costs and energy costs. The SBE Council said this year’s index was expanded to include 36 major, government-imposed or government-related costs affecting small businesses and entrepreneurs. Measurements are added together for an overall rating.

In terms of their policy environments, the top entrepreneur-friendly states in the 2009 index were: 1) South Dakota, 2) Nevada, 3) Texas, 4) Wyoming, and 5) Washington. At the bottom were: 45) Rhode Island, 46) Maine, 47) Vermont, 48) New York, 49) California, 50) New Jersey, and 51) District of Columbia.

The full report is available here.
The Oakton, Va.-based Small Business & Entrepreneurship Council is a nonpartisan, nonprofit small-business and entrepreneurship advocacy group.

Business Conditions Improve in Electrical Sector

Makers of electrical products and equipment cite better business conditions in November, as NEMA's EBCI climbs 2.1 points.

Industrial Distribution Staff -- Industrial Distribution, 11/25/2009

Business conditions improved in the electrical product manufacturing sector in November, according to the latest Electroindustry Business Confidence Index published by NEMA-The Assn. for Electrical and Medical Imaging Equipment Manufacturers.

NEMA's North American EBCI for November climbed 2.1 points to 54, topping the 50-point threshold indicating growth for the fourth straight month and indicating that the "electroindustry" has slowly begun to climb out of its steep downturn, NEMA said.

The North American future conditions index was less optimistic, slipping in November for the second straight month, although still above the 50-point threshold for growth. November's future conditions index registered 58, falling 3.5 points from its October reading. The future conditions index gauges NEMA members' business confidence over the next six months.

"...the index, and by implication the degree of anticipated improvement in conditions, slipped to its lowest level in eight months," NEMA said.

U.S. Leading Economic Index Rose 0.6% in July!

By Bob Willis

Aug. 20 (Bloomberg) -- The index of U.S. leading economic indicators rose in July for a fourth consecutive month, another sign the worst recession in seven decades is almost over.
The Conference Board’s gauge of the economic outlook for the next three to six months rose 0.6 percent, less than forecast, after a revised 0.8 percent increase in June, the New York-based group said today. The coincident indicators index, a gauge of current economic activity, was unchanged after falling every month since October.

Fewer job losses, rising stock prices and a renewal of factory output all indicate government efforts to stem the financial crisis and revive the economy are paying off. Even so, a jobless rate forecast to reach 10 percent and falling home values are a reminder that any expansion will be muted as consumers rein in spending and boost savings.

“Overall this is pretty good news, suggesting the recession is coming to an end,” said Zach Pandl, an economist at Nomura Securities International Inc. in New York. “The stabilization in the coincident index is a strong signal that activity is now leveling out.”

The main index was forecast to rise 0.7 percent, according to the median of 52 economists in a Bloomberg News survey, after an originally reported increase of 0.7 percent in June. Estimates ranged from gains of 0.1 percent to 1 percent.

Philadelphia Fed
A separate report today showed manufacturing in the Philadelphia region unexpectedly expanded in August for the first time in almost a year. The Federal Reserve Bank of Philadelphia’s general economic index climbed to 4.2, the highest level since November 2007, from minus 7.5 in July, the bank said today. Figures from the Labor Department, meanwhile, showed jobless claims unexpectedly rose last week.

Six of the 10 indicators in today’s leading index report added to the index, three subtracted and one was neutral. The biggest lift came from a positive spread between long- and short-term interest rates, followed by drops in jobless claims, a longer factory workweek, rising industrial supplier deliveries, stock prices and orders for capital goods. Weaker consumer expectations, declining money supply and falling building permits pulled it down. A gauge of new orders for consumer goods and materials held steady.

New applications for unemployment benefits fell to an average of 559,000 in July from 616,000 in June. They rose to 576,000 last week from 561,000 the week before, the Labor Department said today.

Factory Workweek
The factory workweek rose to 39.8 hours in July, the highest since January, from 39.5 in June, the Labor Department said Aug. 7. Automotive plants are boosting output in response to signs that demand is recovering as they benefit from government incentives of up to $4,500 for consumers who trade in gas guzzlers for fuel-efficient vehicles.

General Motors Co. this week called back 1,350 union workers, its biggest one-time gain in jobs since 2006, as it boosts second-half production, partly in response to demand from the Obama administration’s “cash for clunkers” program. Ford Motor Co. last week said it is boosting factory output by 26 percent in the second half of the year to meet rising demand created by the trade-in program.

A 1 percent gain in the average level of the Standard & Poor’s 500 Index in July from the prior month contributed to the leading index. The S&P 500 has soared 48 percent since March 9, when it reached its lowest level in more than 12 years, as data signaled the economy may be turning around.

Consumer Expectations
Meanwhile, consumer expectations for the next six months fell in July and continued falling this month, according to the Reuters/University of Michigan survey of sentiment released last week.
Seven of the 10 indicators for the leading index are known ahead of time: stock prices, jobless claims, building permits, consumer expectations, the yield curve, factory hours and supplier delivery times.

The Conference Board estimates new orders for consumer goods, bookings for capital goods, and the money supply adjusted for inflation.
The National Bureau of Economic Research, the arbiter of when recessions begin and end, follows the coincident index to help it time downturns. The index tracks payrolls, incomes, sales and production.

The gauge of lagging indicators fell 0.3 percent following a 0.7 percent decrease in the prior month. The index measures business lending, length of unemployment, service prices and ratios of labor costs, inventories and consumer credit.

June Business Inventories Fall; Sales UP!

Washington, August 13, 2009-

Total business inventories fell by a larger than expected 1.1% in June, marking the eighth consecutive month of inventory declines of 1% or larger, the Commerce Department reported today.

Economists were expecting a smaller 0.9% decline after inventories fell 1.0% in May (since revised down to a 1.2% decline). Inventories have now fallen for ten consecutive months and are down 9.8% over the year.
Article Controls

Retail inventories fell 1.0% in June, while wholesale inventories, as Commerce has already reported, fell 1.7% and manufacturer inventories fell 0.8% in the month. Within retail, inventories at auto and parts dealers fell 2.8%, carrying much of the overall inventory decline.

Excluding autos, retail inventories fell 0.3%, helped by a 2.2% decline in building material supplies and smaller declines in inventories at furniture, food and clothing stores. The only inventory increase within retail was at general merchandise stores, where stockpiles increase by 0.8%.

Meanwhile, business sales shot up by 0.9%, the largest increase since June 2008!Manufacturing sales rose 1.4% and merchant wholesaler sales rose 0.4% in June. Retail sales rose 0.9%, thanks in part to a 1.9% increase in auto sales.

Excluding autos, sales rose 0.7% as a 0.2% increase in sales at food and beverage stores managed to offset declines in every other retail category.

Electronics Buyers Will Increase Orders!

Jim Carbone -- Purchasing, 8/12/2009 2:28:38 PM EDT

Forty-seven percent of buyers responding to the latest Purchasing survey say they will increase their purchase orders for electronics over the next 90 days, an indication that demand for electronics equipment is increasing according to Purchasingdata.com.

About 33% of electronics buyers said that purchase order levels would be steady over the next 90 days, while 20% said they would decrease, according to purchasingdata.com's monthly survey of electronics purchaser.

By comparison, on July 31% of electronics buyers said that orders would decline, while 37% said they would remain the same and only 32% said orders would increase. The survey also found that 73% of buyers say prices for electronics are the same as they were in July, while only 12% said prices were higher than in July.

Many electronics buyers reported business was picking up in early August. A healthy 41% said business was better than in July when only 30% reported improving business.

U.S. Factory Orders UP!

Aug. 5 (Bloomberg) --

Orders placed at U.S. factories rose for a third month in June as oil prices rose and demand increased for goods such as metals and construction equipment.

Bookings gained 0.4 percent after a revised 1.1 percent increase in May that was smaller than previously estimated, the Commerce Department said today in Washington. Excluding demand for transportation equipment such as cars and airplanes, which tends to be volatile, orders rose 2.3 percent.

The factory slump is easing as leaner inventories, signs business investment may pick up and improving demand from overseas reinforce forecasts that the recession will end this year. A federal “cash-for-clunkers” program has started boosting demand for cars, helping the auto industry. At the same time, job losses will mean a slow, muted economic recovery.

“Manufacturers’ customers are growing more comfortable with the level of their stockpiles, which sets the stage for an increase in orders and production,” Ryan Sweet, a senior economist at Moody’s Economy.com in West Chester, Pennsylvania, said before the report.

U.S. service industries unexpectedly contracted at a faster pace in July as concern over rising unemployment gripped consumers. The Institute for Supply Management’s index of non- manufacturing businesses, which make up almost 90 percent of the economy, fell to 46.4 from 47 in June, according to the Tempe, Arizona-based group. Fifty is the dividing line between expansion and contraction.

Factory orders were forecast to fall 0.8 percent, after a previously reported 1.2 percent gain in the prior month, according to the median estimate of 62 economists surveyed by Bloomberg News. Estimates ranged from a decline of 2.1 percent to an increase of 1.6 percent.
Orders for durable goods, which make up just over half of total factory demand, fell 2.2 percent, after a 1.3 percent increase the previous month.

Civilian aircraft orders plunged 39 percent after gaining 60 percent the prior month. Bookings for motor vehicles and parts increased 1.5 percent after falling 4.7 percent.
Sales of cars and light trucks fell to a 9.7 million annual rate in June from a 9.9 million annual rate the month before, according to Woodcliff Lake, New Jersey-based industry research firm Autodata Corp.

In July, sales rose to an 11.3 million pace, the highest since September, Autodata reported this week. That compares with February’s 9.1 million rate, which was the lowest since 1981.
“Perhaps the worst is behind us,” Ford Motor Co. sales analyst George Pipas said in an interview with Bloomberg Television on Aug. 3. “Consumers are feeling better than they did six to nine months ago.” Orders for construction machinery increased 11 percent after rising 10 percent the month before.

Orders for electrical equipment, appliances and components rose 1.3 percent, while orders for primary metals rose 9 percent. Bookings for capital goods excluding aircraft and military equipment, a measure of future business investment, rose 2.6 percent after a 4.3 percent gain. Shipments of those goods, used to calculate gross domestic product, increased 0.7 percent after falling 0.4 percent the month before.

Orders for non-durable goods including food, petroleum and chemicals rose 2.7 percent in June after a 0.9 percent increase a month earlier. Bookings for petroleum and coal products rose 13 percent after gaining 10 percent.

A barrel of crude oil on the New York Mercantile Exchange rose to an average $69.70 in June from $59.21 the prior month. Factory inventories fell 0.8 percent in June, the same as the prior month, and manufacturers had enough goods on hand to last 1.42 months at the current sales pace, down from 1.45 months, Commerce said today.

The Institute for Supply Management’s factory gauge rose to an 11-month high of 48.9 in July, while remaining below the breakeven point of 50, the Tempe, Arizona, group said on Aug. 3. Readings for new orders and production jumped to the highest level in more than two years, while a measure of exports showed the first expansion in overseas demand since September.

A record-breaking drawdown of inventory is setting the stage for future growth. Stockpiles fell at a $141.1 billion annual rate in the second quarter, the most ever, Commerce said on July 31. Commerce also said the economy shrank at 1 percent pace in the second quarter, less than estimated, after a 6.4 percent contraction from January to March.

Economists at JPMorgan Chase & Co. and Deutsche Bank Securities Inc. were among those raising forecasts for U.S. growth after last week’s GDP report.
Gross domestic product will expand at a 3 percent annual rate this quarter, the best performance in two years, said Bruce Kasman, chief economist at JPMorgan in New York. That’s up from his prior estimate of 2.5 percent. Deutsche Bank Chief U.S. Economist Joseph LaVorgna lifted his average growth estimate for the second half of 2009 to 2.25 percent from 0.5 percent.
Nonetheless, some companies remain wary. Nucor Corp., the second-largest U.S.-based steel producer, on July 23 reported its second-ever loss as the global recession cut demand for the industrial metal.

“The uncertainty in our economy is still very high,” Nucor said in a statement. “We are concerned that the marginal uptick in orders is not representative of an increase in ‘real’ demand but more a result of both inventory adjustments and concern over rising prices.”

Strategic Alliances Provide Market Leadership!

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Although, generally recognized for its broad line of North American and internationally-approved power supply cords, cord sets and power supply products, High Tech Connections now features additional capabilities to furnish OEM's and contract manufacturers with a myriad of electronic component solutions...all designed to drive down costs when compared to traditional "branded" products.

Today, smart component buyers are looking to High Tech Connections to provide significant cost savings on products like toggle, slide and rocker switches, circuit breakers, glass fuses and fuse holders, A/V and electronic board-level connectors, IEC power inlets, EMI filters, NEMA panel receptacles, pcb terminal blocks and so much more!

We are determined to meet or exceed the cost-reduction objectives of our valued-customers! YES! We can help your company secure lower unit prices for many volume production components, dramatically improving your bottom line performance!

Please contact the sales department today to discuss a detailed review of all of your component sourcing needs!

World Copper Prices JUMP to $2.70/LB!

Analysts see signs of higher demand, prices ahead according to Tom Stundza -- Purchasing, 8/5/2009 3:06:33 PM EDT

Copper, being one of the best barometers of economic activity, makes its price an excellent way to gauge the pending recovery in the global economy, suggests metals analyst Michael Gambardella of J.P. Morgan Securities in New York.

At $2.70/lb this week on the London Metal Exchange on Tuesday, spot copper cathode is at the highest level of 2009 and the highest since $3.17 last September. The year-to-date LME average is $1.91 but has boosted the 2010 copper price average forecast to $2.17/lb.

Copper is used in power and construction and the early-August price, up from the $2.36 average in July got a boost from news that pending sales of previously owned U.S. homes rose at a faster-than-expected pace in June. The housing data followed positive manufacturing data from around the world that bolstered the view that the global economy was pulling out of a steep downturn.

"Everything seems to be in place for continued strength" analyst Joel Crane at Deutsche Bank tells Reuters, noting there is growing sentiment in equity and commodity markets that the economy is improving faster than originally thought." That's why most forecasters now say there will be growth in gross domestic product in July-September after declining in five of the past six quarters.

Meanwhile, Goldman Sachs suggests to clients in a recent note that copper supply constraints at a time of improved demand this half could mean "that risks to our copper price forecasts are skewed to the upside." The brokerage's 2009 copper price forecast is $2.18, moving to $2.63 in 2010.

Chinese imports of unwrought copper rose to 475,999 metric tons in June from 422,666 metric tons in May, a 12.6% month-over-month growth. So, analyst Jim Lennon at Macquarie Bank in London says "apparent copper demand in the first half was probably up 55-60% year-over-year, suggesting stock building of 400,000-500,000 metric tons, so there remains a widespread expectation of a future slowdown in import demand."

GFCI Plugs Available for Your Appliances!

North American manufacturers can select from several Ground Fault Circuit Interrupter (GFCI)-fitted power cord plugs now available from High Tech Connections. GFCI's are used widely in North America in home appliances, consumer and industrial applications.

A partial listing of products with GFCI power cords include: electric tools, hair dryers, refrigeration equipment, vending machines, stand-alone ATM's, water heaters, wet/dry vacs, submersible pumps, kitchen appliances, outdoor electrical equipment, bench-top lab instruments and many others.

These versatile UL-recognized GFCI plugs shut off power quickly when a "ground-fault" is detected (through a damaged cord), or accidental exposure to water. This action safeguards the user, preventing electrocution.

High Tech Connections' GFCI power cord plugs are available in ampere ratings of 08A, 10A, 13A, and 15A (120V, 50/60Hz). All have an auto-reset feature, meet UL standard Class A (with open-neutral protection) and each incorporates "Test" and "Reset" buttons.

Contact High Tech Connections today for additional information on these versatile GFCI plugs.

Rugged Computing for Demanding Workplaces!

Modern Materials Handling reports on the The Duros 1214 fixed-mount PC. The unit features an ultra-rugged touch screen polysilicon display and all-in-one aluminum housing to withstand the rigors of warehouse and shipping environments.

The Duros 1214 fixed-mount PC features an ultra-rugged touch screen polysilicon display and all-in-one aluminum housing to withstand the rigors of warehouse and shipping environments. It is sealed to IP-65 and exceeds MIL-STD-810F standards for drop, vibration, shock and altitude.

Mountable to forklifts, pallet trucks and automated guided vehicles, the compact unit includes a 12.1-inch SVGA resistive touch screen display. The computer is powered by an Intel Celeron M processor and can run Windows XP, Embedded or Vista, and Linux. Compact flash storage up to 64 GB and four USB 2.0 ports are provided.

A backup battery generates up to 20 minutes of continuous use.

Lego Contest Out West Keeps Going!

Lego is a combination of two Danish words -- "leg" and "godt" -- which, when put together, mean "play well."When she opened Toy Town in downtown Casper, Wyoming during the 1980s, Dalene Lockhart hoped children in the area would play well after shopping at her store.

In 1988, the Lego company sent a promotional contest idea to Lockhart, who decided to try it out. The idea: Hold a Lego contest and see what kids come up with. Encourage creativity. Give prizes.More than 20 years later, Lockhart still helps children play well, and still holds a Lego contest each year.

"It was written up as a promotional thing, so we wanted to try it. And in the '90s we almost quit because there weren't many entries," Lockhart said. "But when we tried to stop it, we got a bunch of calls and decided to keep it going.

"The contest used to be held in July, but when the county fair moved, Lockhart decided to hold it during the last week of summer vacation. This year, judging will be on Aug. 15th.

Now, the contest receives about 80 to 100 entries each year."We've had a little bit of everything," Lockhart said of past contest entries. "We've had baseball games, where people set up a stadium and put in a little baseball scene.

One year someone made a model of a computer. It had the keys and a disk that went in and out, and a monitor made out of black Legos."She's also seen Eiffel Towers, bridges, space ships, cell phone models and birthday cakes."Last year, the winner was a castle," she said. "It was really elaborate."Kids are split into four age groups -- 6 and under, 7 to 9, 10 to 12, and 13 and older.

First-, second- and third-place prizes will be given out for each age group, and every entrant will get some sort of smaller prize as well. An overall best-in-show prize will also be awarded.The only rules require that kids use their own Legos, and the final product can't be more than three square feet at the base, "just because we don't have that much room," Lockhart said.

Kids can work on their projects for as long or as little as they'd like."Some say they've been working all summer. Some go home and come back an hour later," Lockhart said. "Some people, as they get older, if they're really into it, they plan year-round."Most of all, kids need to be creative, she said.

"We look for use of color, stability and overall creativity. We look for kids to not use just a kit."
Author is Megan Lee, Star Tribune.

The Ford Mustang Has Seats of Soy!

After long period of development, Ford Motor Company, Dearborn, Mich., and Lear Corp., Southfield, Mich., recently began an industry-first use of functionalized soybean oil in the manufacture of flexible, polyurethane foam for automotive seating. The use of renewable materials as a feedstock for Automotive Soy-Based Seating Foam offers many benefits including reducing environmental footprint, replacing limited petroleum-based products with sustainable materials, and providing an alternative material choice.

Development was not easy, however. Soy-based foams pose various challenges to manufacturers, including low chemical reactivity, blend separation, odor, fogging, and green strength. The team invented and developed new foam formulations to overcome all of these limitations and meet the stringent mechanical requirements of automotive seating, including adequate manufacturing cycle time.

First used in the company’s Mustang car, the seat will soon be added to other automotive lines.

Safety Tip: Outfitting your Distribution Center Workers!

Here's a look at ways to equip your workers to handle the most common distribution center hazards and a few tips to help you choose the right gear.
By James P. Kaletta, Safety Management Solutions --

Modern Materials Handling, 6/1/2009

As you determine how to outfit each type of worker in your facility, start by considering all applicable regulatory requirements. Various standards from the Occupational Safety & Health Administration (OSHA), the American National Standards Institute (ANSI), the National Fire Protection Association (NFPA), and other organizations can all come into play, depending on the type of work at your facility.

First, consider OSHA's 29 CFR 1910, Standard for General Industry. This is the source of the often-cited General Duty clause, saying that employers will furnish to each of his employees a place of employment that is free from recognized hazards that are causing or are likely to cause death or serious physical harm. A hazard is any existing or potential physical condition which by itself or by interacting with other variables, can result in death, injury, illness, property damage and/or other losses.

According to OSHA, if a given hazard can't be eliminated, it must be controlled. So, you'll also need to be familiar with OSHA's Personal Protective Equipment standard for those instances where your company cannot eliminate or engineer out the hazards.

This standard requires employers to determine what personal protective equipment (PPE) is necessary based on workers' specific activities. To do this, you'll need to conduct a risk assessment of each job.

Luckily, plenty of personal protective equipment is available to meet any need. But that PPE can only protect employees when it's the right gear for the particular task and it's worn correctly at all times.

PPE worn for situations other than those intended by the manufacturer can actually create hazards when worn inappropriately or cared for improperly.

Common hazards in distribution centers include:

Cuts and abrasions
Strains and sprains
Falls from heights
Excessive noise
Electrical work
Extreme temperatures

Cuts and abrasions

Workers need appropriate gloves for such common tasks as cutting boxes or other materials, pallet handling and picking product. Glove materials must be sturdy enough to provide protection for the specific task to gloves that are too small or too large can reduce workers' dexterity and contribute to fatigue. This leaves workers vulnerable to repetitive stress injuries, reduced productivity and seemingly unrelated injuries like dropping heavy objects on themselves or others.

Strains and sprains
Low-back strains continue to be the leading cause of lost-time occupational injuries. There are no substitutes for teaching and enforcing proper lifting techniques.
If your company authorizes the use of back belts, be aware that several large studies conducted by the National Institute for Occupational Safety and Health (NIOSH) have shown they can cause back muscles to atrophy if worn tightly for prolonged periods, making the wearer more prone to injury. They may also impart a false sense of confidence. Always seek medical advice when considering the use of back belts.

Falls from heights
Working at height is a common distribution activity for servicing equipment, clearing jams and operating order pickers. According to OSHA 1910 Subpart D, Walking-Working Surfaces, fall protection is required whenever workers conduct activities 4 feet or more above the working surface. When identifying the need for fall protection, always include employee position in your calculations: the 42-inch top rail that is adequate for employees working on the floor becomes inadequate when employees are working on a stepstool in that area.
Be sure you understand the requirements in OSHA 1915.159, Personal Fall Arrest Systems, before you select or install fall-arrest equipment like lanyards, body harnesses (consider flexible harnesses, if possible) and approved tie-off points (temporary, permanent or lifeline). Consider using retractable lanyards, which are designed to engage quickly to limit fall distance, compared to lanyards that engage at a predetermined length. When used properly, retractable lanyards can reduce trauma to the body and force to the tie-off point during a fall.

Excessive noise
OSHA 1910.95, Occupational Noise Exposure, requires employers to provide hearing protection to workers who are exposed to noise with an 8-hour time weight average (TWA) of 85 decibels on an A scale (dbA). Once the noise level reaches 90 dbA or greater on an 8-hour TWA, employees must wear hearing protection. OSHA says that employees who are required to wear hearing protection shall be given the opportunity to select their hearing protectors from a variety of suitable hearing protectors provided by the employer.

Electrical work
Selecting PPE to protect workers from electrical shocks, blasts and arcs will require you to become knowledgeable about OSHA 1910.331-335, Electrical Safety Related Work Practices, and NFPA 70E, Standard for Electrical Safety in the Workplace, and/or hire an expert vendor. One critical factor in selecting the proper PPE is conducting an arc fault analysis to determine what category you will need to dress to. For example, the following PPE is required using the Category 2 quick method from NFPA 70E:

Flame-resistive clothing (8 cal minimum)
1000 V-rated rubber gloves
Leather glove protectors
EH hard hat and face shield
Safety glasses
Hearing protection (ear plugs)
Head sock
Leather work shoes (consider electrical hazard rated shoes with non-metallic protected toe).

Extreme temperatures
When outfitting workers for refrigerated or frozen-storage areas, you should focus on warmth while limiting bulk. Consider banning hooded clothing when working on or near automated retrieval or powered industrial trucks because they (especially snorkel hoods) can drastically block vision. I am personally aware of one employee who was killed because his hood impaired his vision and he was caught between his lift truck and a rack leg.

Nissan Previews New Electric Vehicle!

According to ECN, Nissan Motor today previewed its electric vehicle (EV) platform on a Tiida-based prototype. It also showcased a sophisticated EV-IT system developed to support electric driving 24/7.

Newly developed EV platform:
The dedicated EV platform is comprised of a highly rigid body, high-performance motor, compact lithium-ion battery with high power output and energy capacity. The in-house developed electric motor delivers 80kW/280Nm for high response and powerful acceleration. Nissan’s unique motor control also contributes to the vehicle’s seamless acceleration.


The 24kWh laminated compact lithium-ion battery pack is placed under the vehicle floor for more efficient packaging, without compromising cabin or cargo space. The battery layout also allows smooth underfloor air-flow which helps reduce drag. Additionally, the regenerative brake system employed to recharge the battery during deceleration and braking extends the driving range to more than 160km*1 under a full charge.

High durability is achieved by employing an additional frame for the battery pack to significantly improve the rigidity of the platform. The combination of a high rigidity platform and electric powertrain minimizes vibration and external sounds to produce a quiet and pleasing drive.


EV-IT support function:
Nissan has developed an sophisticated IT system for its zero-emission EVs, connecting the vehicle’s on-board transmitting unit to a global data center*2 to support EV driving 24 hours 7 days a week. Usability and convenience for EV driving is achieved via the following...


Maximum range display:
* With a simple touch of a button, the navigation map shows the driving radius within range under the current state of charge.
* The system can calculate if the vehicle is within range of a pre-set destination.


Update on charging stations:
* The navigation system points out the latest information on available charging stations within the current driving range.
* Detailed information for each charging station will also be displayed.


Timer function:
* The timer function enables the air-conditioner or battery charging to begin at a specified time. The air-conditioner can be pre-set while the vehicle is plugged-in to cool the cabin to a desirable temperature before driving begins, without taxing the vehicle’s battery. Meanwhile, the battery charging can be set to start at a specified time at night to benefit from more favorable electricity rates.


EV remote control and monitoring function:
* The driver can monitor the state-of-charge of the EV via an online website and a cellular phone. For example, when the battery is fully charged, a message alert is sent to the cellular phone. Additional remote control functions range from switching the charging system ON/OFF or setting the air-conditioner timer.


To be a leader in zero-emission mobility, Nissan is progressing its development for electric vehicles and the key components. The all-electric vehicle slated for launch in 2010 will have a unique design and body.



Nissan plans to unveil the design of the production EV at its new Global Headquarters Opening in Yokohama on August 2nd. A Nissan Zero-emission Website http://www.nissan-zeroemission.com/) will also go live on Aug. 2nd.

Company Retrofits iPods with 240 GB Hard Drives!

(Fortune Small Business) -- Like many consumers, John Mayberry was looking to upgrade his iPod. The IT technician had 50,000 songs stored on his computer, but his 60-gigabyte iPod maxed out at 12,000 songs. And Apple (AAPL, Fortune 500) wasn't helping.

Last year the company discontinued its largest iPod, a 160GB model, citing concerns about its design. Currently the largest iPod that Mayberry can buy is 120GB - or half the size of his music library.

That was the cue for Rapid Repair, located in Kalamazoo. In February the startup began retrofitting old iPods with a new 240GB hard drive. The price of the procedure, $300, was the same as the cost of a new iPod, and having the device hacked broke its warranty.

But Mayberry didn't care: He finally had an MP3 player equal to his music library. "I'll hold on to this one for a while," he says. He wasn't alone. In the first two hours the service was available, Rapid Repair received 300 orders - more than its inventory could handle. One month later the company had solved its supply problem and upgraded 500 iPods.

The 1.8-inch hard drives, made by Toshiba, are of roughly the same dimensions as regular iPod hard drives. Rapid Repair clears around 25% profit on each installation. Thanks to swift advances in storage technology, the company appears to have tapped into a market for expanded iPods that the computer giant isn't serving.

"You couldn't have made this business happen 10 years ago," says CEO Aaron Vronko, 26.
In 2007, Vronko launched Rapid Repair with a business school classmate, Ben Levy. Both technophiles, they shared an aptitude for fixing broken cell phones and MP3 players. A business model was born: By 2008 the company had 15 employees and was repairing some 500 gadgets a week, mostly via online orders. Revenues totaled $3 million last year.

By this summer, Rapid Repair hopes to offer the same upgrade service for Microsoft's Zune and other MP3 players. The company's new focus on upgrades involved a major shift in strategy.
"People don't upgrade because their devices are a little beat up," says Dale Ford, an analyst with iSuppli, a research firm based in El Segundo, Calif. "It's more because they think, 'Wow, look at what these new devices can do."

Leaders: Take a Ride on the "Down Economy" Bandwagon

With a recession in full-swing, now's the time for leaders to re-evaluate and invest in their organization's employees and future. Seems like we've been preparing for this current recession for the past two or three years, constantly predicting it and staving it off as long as we could, all the while listening to the media tell us that it was just around the corner.

And now that it is here—and it is here—we're witnessing a new media-inspired cottage industry building up around the "down economy" and the bad times that are upon us. Every news story seems to have the addendum "in a bad economy" attached to it. I suspect that soon there will be a new "Recession Barbie" doll on toy store shelves, complete with a frown on her face and a copy of the job listings from the newspaper in her hands.

Well, so far I've resisted jumping onto the "down economy" bandwagon, not wanting to contribute to any self-fulfilling prophecy or culture of victimization that can make a bad situation worse. But after numerous requests, I've agreed to share my own perspectives about how leaders can survive and even thrive during difficult times.

Leadership Survival Tactics - The first thing we have to do is ask ourselves a fundamental question: do we believe things will get better? If we don't, if we believe this is the definitive end to any upside in the economy and that it's all downhill from here, then I'm afraid I have no good advice. Aside from moving somewhere that does have an economic upside.

But most of us would admit that this, too, will rebound. Maybe not the same way it has in the past. After all, there are some fundamental problems that we haven't yet faced. But even in the absence of that, there is a good chance that we will experience an economic upturn sometime in the not-too-too-distant future.

And if that is the case, our call to action is clear: use this time to invest in your organization's future, especially when the investment is not a financial one. The best place for an investment right now is in the general health of an organization. I'm talking mostly about improving the functioning of the executive team, and their clarification of and recommitment to the organization's values and purpose.

Doing this will require a little time and energy, but very little money. And it will yield significant returns now, and even more when the economy rebounds. How? A wise executive team will take this opportunity during slow times to build greater trust and behavioral cohesiveness. This will benefit the organization by minimizing politics and infighting, that are common during difficult times, and it will allow the team to make better decisions about which programs and employees need to be retained and which shouldn't.

All of this will allow the organization to emerge stronger than ever when the economy turns around, and with a meaningful advantage over competitors. That's because most of those competitors will probably flail during down times, frantically searching for a tactical way to swim upstream and defy the current, leading to even more frustration and angst than is necessary. In the end they'll simply be more weary and scarred and unprepared. Of course, like so much of the advice that people are repositioning these days for a "down economy," none of this is really new.

Even during good times company leaders should be investing in the health of their teams. But with so many shiny opportunities in front of them, they often fail to slow down and do what it is best for the long term. Now that there are fewer and fewer of those shiny opportunities, there is no good excuse. ..and that may turn out to be a good thing!

For more on Lencioni, read the recent Incentive Interview at incentivemag.com.

FORD: Even IF Sales Fall; Company Can Survive.

Amy Wilson and Philip Nussel Automotive News February 26, 2009 - 11:49 am ET

Ford Motor Co. today said it has enough cash to survive 2009 without help, even if U.S. industry sales drop to an annual pace of about 9 million light vehicles and stay there for the year.
Ford auditors signed off on the company's annual report to U.S. regulators without issuing a "going concern" statement. Ford finished the year with total cash and securities of $15.7 billion -- down from $33.0 billion at the end of 2007.


Echoing previous public statements, Ford management wrote in today's report that the company should survive the 2009 downturn. General Motors isn't so sure. Its auditors are expected to raise doubts about the automaker's ability to stay alive this year.

Things could get worse -
But Ford cited two scenarios that could change its opinion:


• A further decline in U.S. sales beyond current assumptions of between 10.5 million and 12.5 million total vehicles. That is a new forecast for Ford. The company lowered its assumption from an earlier forecast of 11.5 million to 12.5 million vehicles.
But Ford added that even if U.S. sales fall 20 percent below the midpoint of its assumption -- to 9.2 million vehicles -- it "would not exceed our present available liquidity." The risk that industry sales could decline to volumes below that level "is remote," Ford said.


• The company must spend more money than expected to bail out suppliers and ensure parts deliveries. "It is reasonably possible that our costs to ensure an uninterrupted supply of materials and components could be higher than our present planning assumptions by a material amount," the company said.


But Ford said that even under most of the worsening scenarios, it should have enough cash to survive. The company's report said: "Therefore, we do not believe that these reasonably possible scenarios cause substantial doubt about our ability to continue as a going concern for the next year."


GM will have 'going concern' issue -
Earlier today, GM said it likely will receive a notice from auditors who will assess the risk that the automaker might not be able to continue as a "going concern." GM, which has been kept afloat with emergency loans from the U.S. government since the start of the year, posted a net loss of $30.9 billion for 2008.



That ranked as the second-largest annual loss for the 100-year-old automaker, behind only the $38.7 billion deficit recorded for 2007. Last week, the auditing firm Grant Thornton said such notices may be common as auto companies file their annual reports with the Securities and Exchange Commission.


"It's important for the public, the supply base and all of the parties involved in restructuring the auto industry not to overreact if they start seeing 'going concern' opinions," Kimberly Rodriguez, a principal in Grant Thornton's restructuring practice, said in a statement.

Dave Versical contributed to this report.

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