Tag Archive: China

Trump and Trade

January 31st, 2017

Well, you’d have to be living under a rock to have not heard all the controversy about Trump and trade. Tariffs, restrictions and general chaos….

Currently, the U.S. trades significant volumes with China, Mexico and a whole host of other countries as we live in a global economy. For example, in looking up trade balances with China for 2016, the U.S. exported $104,149 (in millions) and imported $423,431 (in millions). Thus, what is all this hoopla about and what should supply chain leaders be thinking?

global trade

What Should We Consider and/or What Impacts Could Arise?

Although it is easy to get caught up in all the emotion and politics, the bottom line is that we aren’t going to flip the import/export numbers with China (as an example). Will it change in some respect? Of course; it would regardless. Will the trade figures change substantially this year? No. Will companies re-evaluate their insourcing, near-sourcing and outsourcing decisions as costs change with tariff adjustments? Yes.

We are headed into volatile times; however, this is not abnormal in supply chain circles. Who can predict hurricanes? No one. Yet hurricanes and natural disasters affect the supply chain every day. Those who are successful will find a way to adjust with changing times and will become more agile in their responsiveness to changing circumstances. And they will figure out what is most important to their business and focus solely on those factors while building agility into the rest.

What is most likely to occur is that Trump will re-evaluate trade deals and re-negotiate. If we took a step back and looked at our trade agreements, what makes sense? How can we keep businesses flowing yet improve the deal? If you are interested in getting in front of the curve, consider these factors for just those areas most critical to your success.

 



Global Is “In”

July 5th, 2016

profit through peopleOne of the reasons my global advisory board has been as valuable as its been is because it is global. We have people from the U.S., Australia and Japan with experiences from all around the world, and we are supported by a wider community with people from almost every continent. Looking through a U.S. lens might seem expansive to someone who has spent his/her lifetime in one state or on the east coast or the west coast yet it is narrow as compared to global impacts surrounding business on a daily basis.

No matter what you think in terms of politics and the like, it is imperative that you understand global impacts. For example, with the China struggles going on earlier this year, manufacturers should be on high alert for future quality issues. Have you been considering that? When I was in Australia for my strategy session, we discussed the impact of the strong U.S. dollar. Certainly it made my trip less expensive; however, it has far reaching impacts. Which countries should companies source from? Should they hedge? Should they in-source? There are vast numbers of questions to think about.

Within the last week, Europe has certainly had a strong impact on not only the stock markets but the global economy. What will Brexit mean? What decisions should companies be making now for impacts that will occur within the next 1-5 years? How should they mitigate risk?

The Olympics is another global topic. The Zika virus has certainly impacted attendance. How will companies protect their employees? Are athletes willing to take the risk? Money was poured into preparation for the Olypmic games. What will happen if it falls short?

It doesn’t matter what you think about globalization. It is all around us. The only question is whether you’ll be prepared and thinking ahead on how to best prepare and leverage for likely global impacts.

Did you like this article? Continue reading on how to strengthen your Eagle Eye:

The Impact of China’s Slowdown

The Hidden Benefit of Observation 

 



The Impact of the Volatility

January 27th, 2016

supply chainCertainly, you’d have to be hiding under a rock to not have heard about the wild swings in the global stock markets lately. Although we’ve definitely become more comfortable with volatility, it still can cause executives to take a step back and think. What if China’s slowdown affects manufacturers in the U.S. more than we realize? Should I be thinking about pulling back vs. a full court press on growth? Should I continue investing? What can I do about this wild foreign exchange market if I have suppliers and customers using different currencies?

Those executives who find a way to be comfortable with and leverage volatility will thrive! We might as well get used to it as it is the “new normal”.

One tip to implement this week:

In thinking about leveraging volatility, the first order of business is to not overreact to fluctuations. As hard as it might be to not react when you see money rushing out the door with currency exchange rates or some other factor, the key is to remain calm. Take a step back. Is this change some sort of reaction that will likely reverse itself? Or is it based in a fundamental change that will affect your business over the long haul? Dig into the changes that are most impactful to your business and determine if they will affect you over the long term. If not, don’t overreact. Instead, build flexibility into your work processes and business model. If so, put together a plan to proactively address the situation. Burying your head in the sand might seem like a good idea, but it isn’t! 

Looking for more ideas to keep your supply chain connected? Access more tips and resources on my blog. And keep connected by subscribing to my newsletter and email feed of “I’ve Been Thinking…”

 



The Impact of China’s Slowdown

January 18th, 2016

supply chainIt is somewhat of a coincidence that I’ve heard a few presentations about China recently (thanks to international attorney and China guru John Tulac as one of these experts) which synced up with the stock market plunge in China — and in the U.S. (and thus globally). Of course, that has also spurred on other conversations about China. The bottom line is that manufacturers and distributors should be weary and on alert.

It is very likely that if you are a small to mid-size business, the quality you receive from China will suffer eventually. It is less likely to affect companies like Apple but it is very likely to affect the rest. Lowering quality levels is one potential impact of the slowdown. It is also possible that suppliers could go out of business if their owners lose a bundle in the stock market. There could be many impacts……the key is to be on the alert and thinking ahead of time about your specific supply chain and potential impacts.

 
One tip to implement this week:

As one of my consulting colleagues said, this is no surprise. He had been warning his clients for years about this outcome. With that said, it is easy to be lulled into thinking the present will continue into the future. Instead, before it is too late, take action. Start by making sure you have solid relationships with your supply chain partners. You’re less likely to be impacted if you have good relationships. Next, no matter how great your relationships, you should have backup suppliers, backup plans and metrics to track progress. You’ll want to catch issues early.

The most successful supply chain partnerships I’ve seen are when you are upfront with all supply chain partners. This means you cannot keep a backup that you never use until you are desperate. It also means you cannot pretend as though you don’t have a backup. Solid supply chain partners understand the value of having a strong supply chain and monitoring its health. Take steps to make it so!

Looking for more ideas to keep your supply chain connected? Access more tips and resources on my blog. And keep connected by subscribing to my newsletter and email feed of “I’ve Been Thinking…”