Category Archives: Supply Chain

Need to Trade More Confidently? Maybe You Need Trademo to Monitor Your Supply Chain!

As you should be well aware by now (as we recently gave you a 10-part series on supply chain risk), supply chains are fraught with risks — that you need to manage, and that, in many cases you can only manage with visibility. In particular, multi-tier visibility down to the source raw material. You also need insight into key areas of regulatory compliance around H(T)S codes for trade (and ECCN for defense trade), sanctions and denied parties, and (known) forced/slave labour violations by any supplier in your multi-tier supply chain.

One application that can give you multi-tier visibility, detailed insight into key areas of compliance, supplier discovery, and even trade intelligence is Trademo. Centered around a global supply chain knowledge graph on over 5M buyer and supplier entities with over 100M relationships built upon public trade (import/export) data from over 140 countries, Trademo can provide unique multi-tier visibility and insight into your supply chain, and the supply chains of your competitors which can help you find potential suppliers who could also serve you and even identify other supplier locations that could be more relevant for you.

There are three main parts of the Trademo platform.

  1. Global Supply Chain Intelligence
  2. Supply Chain Visibility & Resilience
  3. Global Trade Compliance

We’ll discuss these in reverse order, as that is the typical order in which organizations generally seek out, implement, and use these solutions.

Trademo‘s Global Trade Compliance module supports an organization with

  • HS Tariff Search, Validation and Classification across 140+ countries
  • ECCN Search
  • Sanctions Screening across over 640 global sanctions list
  • (Import/Export) Controls (and Embargo) Search
  • Product Master
  • Landed Cost Calculator

HS (Code) Search is by country, trade direction (import or export), and partial code or product keyword. (HS codes could be classified either by referring to the built-in tariff tree structure or using the AI model to classify the HS Codes.) it brings up all the matching codes based on the product key word (or partial HS code), as well as the computed match relevance. You can then select the code of interest and see the associated tariffs and duties, controls, and any associated rulings.

ECCN search is similar to HS (Code) Search and is by country and ecn/ml number or keyword and brings up the relevant subcategories that you can dive into and get relevant details.

Sanctions screening can be ad-hoc, bulk, or advance. Adhoc allows a sourcing / supply chain professional to enter a person, company, or vessel name and screen against any set of sanction lists of interest (one, some, or all). Bulk allows the same, but against a list of uploaded persons, companies, and/or vessels. Advance screening is similar to adhoc, but allows the user to limit to countries, specific locations, and even set thresholds for partial match retrievals. The user can also setup blacklists, so that any attempt to associate a product in the master with a supplier that is blacklisted fails, any search on it returns its status, and any export includes the blacklist status. The user can also setup watchlists (for daily monitoring) and any time a new sanction, control, etc. is detected for the person, company, or vessel, an alert is created in the tool and sent to the user through e-mail.

Sanctions screening are against rules that define collections of sanction lists that are relevant to the user and the types of screenings they usually do. For example, if the organization only sources from and/or two 20 countries, they may not care about any sanctions or embargoes against the remaining countries for which sanctions and embargoes are encoded in the system. In the Trademo system, rules are sorted into list groups (global sanctions, PEP, OFAC, health & human service, banking & investments, enforcement, and maritime) and then sub-groups by source (country, entity, etc.). The buyer can select what interests them, a threshold for matching, define a rule name, and then easy peasy search just those lists going forward.

When a sanction is found, extremely detailed information is returned and generally includes the entity name, the list, the country, the authority, all known entity (operating) aliases, effective date, expiry date (if a limited embargo, for example), company address / vessel birth and identifiers / personage citizenship or address, etc. A user can also bring up the full citation and download everything in PDF if they desire.

Controls bring up, for an import country or ISO Code and/or export country and ISO Code and/or country of origin and ISO Code and/or a HS Code, all related controls and embargoes along with their type (such as import permit or export permit), the controlling authority, and the scope of the control. As with a sanction or HS code, the user can click into a control of interest and see the complete details and download the source (as a PDF) if they so desire.

The Product Master allows the organization to manage their product database down to a SKU level, along with all countries of import, export, and associated HS codes. This makes it easy for the platform to automatically monitor for relevant changes to HS/ECCN codes, duty rates, controls, embargoes, etc. and notify the user when these changes occur.

The Landed Cost Calculator is very useful for sourcing professionals as it allows them, for a lot, to enter some basic information and source unit and carrier costs and get a complete total landed cost based upon the HS / ECCN code and all import and export tariffs.

The user needs to simply enter:

  1. Country (of import, export, and origin), duties of interest (default, preferential, or both), and HS CODE
  2. Mode of transport, incoterm, currency, value (and, optionally, unit of measurement & total quantity)
  3. Freight, insurance, and any other known (sur)charges

The platform will then calculate the total landed cost that will include all the duties and tariffs on the lot, the known merchandise processing fees, the known vessel fees, the known port fees, and other known fees and give the user a total landed cost (where the user can see a 200K buy become a 250K or 300K or more buy and truly understand the cost of global sourcing). the user can also compare the landed cost across different sourcing markets.

Moving on to Trademo‘s Supply Chain Visibility & Resilience solution, it is essentially a supply chain mapping solution that allows an organization to see all of their 1 to n suppliers (3 by default, but more if they want) and filter into suppliers by tier, country, HS code, and associated trade lanes. They can create product groups by brand or region and just see the associated supply chains for those brands and regions as well. The default view shows them the supplier name, domicile country, HS codes supplied downstream, trade lanes used, tier 1 connection, and total shipment value. From this complete list, the user can select a subset of suppliers by country, HS code, and/or trade lane and see a graphical representation of their supply chain, augmented with trade value. It’s simple, but quickly informative and very useful to discovering just who is in your supply chain, as well as who is in a certain region / on a certain trade lane that was just impacted by a natural disaster or border shutdown and you need to react.

Finally, there is the foundational Global Supply Chain Intelligence intelligence offering (Trademo Intel) that is based on their core supply chain knowledge graph and all of the public trade data it incorporates. The entry point to Trademo Intel is the shipment search screen which allows the user to search across all bills of lading in all categories and retrieve all associated shipments, which can then be filtered by shipper details, consignee details, ports, cargo, and freight details, and see a summary, for the selected timeframe, of total shipments, total weight, and total value. They can then drill into (top) importers, exporters, and more detailed analytics. If the amount of data is overwhelming, they can limit to specific product categories, HS codes, shippers, or consignees before starting the search.

It’s a great tool for exploring your competitors’ supply chains, which, when limited to certain product (categories), allows you to discover potential suppliers you might not have known about otherwise. Furthermore, you can see the volumes they are capable of supplying globally and the trade lanes they are already navigating. While most risk solutions will give you credit, cyber, compliance, and/or sustainability risk, they don’t give you deep insights into products supplied, locations supplied from, lanes the supplier is using (which indicates which global regulations they comply with), and so on. When you click into an entity, you can see all of their trading partners, total shipments to/from each, HS Codes supplied, and associated shipments. They can then drill into any and all shipments of interest and see complete details. The analytics are super helpful in identifying the top HS codes, HS sections, modes of transport, and routes used by the entity.

It also allows an organization to keep tabs on global trade from a certain region and whether it is increasing or decreasing, which could signal tidal shifts that could affect future cargo availability, rates, and risks if there is over saturation or under saturation of a trade region predicted.

If you need global trade support around HS codes, sanctions or embargoes; supply chain visibility; and supplier discovery (and deep trade insight in this discovery), Trademo is a solution that should definitely be in your RFP short list. It’s easy to use, powerful, and already validated by a number of Global 3000 companies. Check it out and TRADE MOre confindently!

Source-to-Pay+ Part 10: Over 55 Supply Chain Risk Vendors to Check Out

Last quarter, we ran a 9-part series that served as An Introduction to Supply Chain Risk where we introduced you to the risk elements not covered by traditional supplier management platforms (which we covered in our 39 Steps … err … 30 Clues … err … 39 Part Series on Source to Pay where we listed over 90 supply management companies of which over 1/3 claimed to have some degree of “risk”, which we dub supplier “Uncertainty”, management).

In our series, we focussed heavily on corporate risk, third party risk (which included ESG, Human Rights, Regulatory Compliance), supply chain risk (including transparency, traceability, and multi-tier tracking), transport risk, cyber risk, and analytics. We also noted that our next instalment would provide a starting list of vendors that you could check out to meet (some of) your supply chain risk needs.

This is that instalment. Hopefully this starting list will be useful to you. In the months that come, the hope is that some of these will be covered

Legend

 3P 3rd Party / TPRM
S/V supplier risk / verification
SCT supply chain transparency
T/L transport / logistics
 MT multi-tier
  C cyber
ESG Environmental, Social, Governance
 HR Human Rights
 RC Regulatory Compliance
BoM Bill of Materials (Direct)
 DX Discovery
 TX Traceability
Vendor LI/#Emps  3P S/V SCT T/L  MT   C ESG  HR  RC BoM  DX  TX
&wider 20 Y Y
Agora Sourcing 2 Y Y
AMLRight Source 2795 Y Y
Apex Analytix 411 Y Y Y Y
Aravo 117 Y Y Y Y
Archer 681 Y Y Y
Altana Atlas 166 Y Y Y Y Y Y
Brooklyn Solutions 24 Y Y Y
Certa 200 Y Y Y Y
Circulor 63 Y Y Y Y Y
Contingent 28 Y Y Y Y
Darkbeam (Apex Analytix) 8 Y
Diligent 2245 Y Y Y
Exiger 765 Y Y Y Y Y
Everstream Analytics 165 Y Y Y Y
Fact 360 12 Y
FairSupply 40 Y Y
FRDM 28 Y Y Y
FusionRM 275 Y
GoSupply 33 Y Y
IntegrityNext 96 Y Y Y
Interos 254 Y Y Y Y
Kharon 102 Y Y Y Y
MetricStream 1373 Y Y Y Y Y
Navex 1343 Y
NQC 104 Y Y Y Y Y
Overhaul 312 Y Y
Prevalent 161 Y Y
Prewave 150 Y Y
ProcessUnity (w/CyberGRX) 143 Y Y Y
Raad360 3 Y Y
RapidRatings 166 Y
Resilinc 299 Y Y Y Y
Resolver (Kroll) 371 Y Y
Responsibly 17 Y Y
RiskLedger 34 Y Y
Riskonnect 801 Y Y
RiskRecon 116 Y
RoboAI 57 Y Y Y
SAI360 435 Y Y Y
Sayari 180 Y Y
Sedex 442 Y Y Y
Seerist 127 Y
SourceMap 91 Y Y
Sphera 125 Y Y
Supply Risk Solutions 10 Y
SupplyShift 59 Y Y
SupplyWisdom 116 Y
Sustainabill 15 Y Y
The Smart Cube 1033 Y
ThirdPartyTrust (Bitsight) 16 Y
TraceLink 947 Y Y Y Y Y
Trademo 97 Y Y Y Y
Transparency One 23 Y
Trust Your Supplier 15 Y Y
Versed.AI 17 Y Y
VisoTrust 47 Y
Whistic 81 Y
WholeChain 10 Y

The Supply Chain of Supply Chain Talent is Not Only Broken … It’s Running On Empty!

A recent article in Forbes noted that The Supply Chain of Supply Chain Talent Is Broken, which it is, and has been for well over a decade. The problems started back with the global first world truck driver shortages back in the early 2000s, but the real problems were much deeper and hidden from view due to the fact supply chains were otherwise running smoothly and no one was looking behind the curtain or shining a light into the dark recesses of the supply chain.

Why? Because of the rampant digitization of procurement, logistics, and supply chain over the past twenty years, a time when globalization reached its peak, conflict was at a minimum, inflation was in the rear-view mirror, and natural disasters were still manageable, supply chains just worked. Predictable processes, routes, costs, and flows allowed simple systems to manage the supply chains almost automatically. Supply Chains didn’t need traditional supply chain talent to run; they needed buyers, logistics managers, inventory operations, and compliance personnel who could use systems — IT geeks ruled the day!

At the same time, seasoned supply chain professionals — negotiators, logistics professionals, and inventory/warehouse managers — were retiring in droves, and no one was replacing them. More importantly, no one was replacing them because there was no perceived need. These were the individuals who where doing supply chains in the 80s and 90s, before modern systems managed everything, when there were still lots of regulations to deal with (as the EU was still forming), when you didn’t always have container ships available (or easy container transportation to all locales), and when you would have to know, by rote, who to call when a truck wasn’t at the factory or the dock for a pick-up. When you had to do everything by phone and fax, because email was a luxury; when you had to deal with dozens of import/export regulations (and know how to create the reports by hand), and how to manage logistics scheduling on paper, especially when availability of certain carriers or personnel would change by the day. When you had to truly know how supply chain operations worked end to end, and not just push buttons on a virtual screen.

But then they retired, and no one replaced them. Even worse, no one was recruited to replace them. The organizations saw no need, since the systems did everything, the EU and harmonized regulations across regions made trade easy, and the big global carriers managed logistics for them. As long as they had negotiators, system operators, outsourced carriers, and outsourced consultants to do the rest, who cared? They certainly didn’t.

Furthermore, because there was no need in the organizations, people who studied Operations Research and might have went into Supply Chain went elsewhere, and as demand shallowed, so did students, but more importantly, so did apprenticeships. Now, with disruptions on the rise, globalization retreating, inflation resurging, supply chains breaking due to slowdowns, (port) shutdowns, and double canal slowdowns/closures (Panama and Suez), and current systems not designed for the world today, there’s no one who can handle the current situation. And that’s why supply chains are broken, talent chains are broken, and most importantly, why they are empty.

All of this happened behind the scenes because no one was watching, no one was thinking about the future, and no one was doing a risk assessment or managing the risks that were destined to come. All despite the fact that natural disasters were on the rise, political tension was on the rise, and we were being warned that a pandemic was the top global risk for over a decade.

Now we are at a point where software alone won’t fix this, consultancies who don’t have talent either (despite telling you to go to China for two decades) won’t fix this, and hope won’t fix this. The only thing that will fix this is the re-introduction of supply chain apprenticeship programs, as noted by the Forbes article, along with the return of retirees with actual knowledge to mentor the new recruits, which is missed by the article. Most organizations, or consultancies, these days barely have enough talent to manage their own operations yet alone train a batch of new recruits on the side, especially if they didn’t live through the rise in global trade in the 80s and 90s. The retirees did, and they have the knowledge the consultancies, and modern systems, don’t. Along with new recruits, it is their (temporary) return that is needed to fix the supply chains.

It Was the Most Wonderful Time of the Year. Could it Be Again?

A couple of months ago we published an article on how ‘Tis the season … to bring an end to seasonality! (And JIT!) because, while consumer shopping may be seasonal, supply chains no longer support seasonality. The pandemic finally broke globally over-stretched supply chains and with the continued issues (lack of ships, due to scrapping; containers; due to trade imbalances; lack of capacity, due to extended shipping times now that the two major canals are not available and ships have to sail around both capes), the situation is not going to be fixed anytime soon.

In the article we noted that if you didn’t want to seasonally stock out, you needed to stop trying to stock seasonally and start planning for sustained stock up over time. Stock at the rate products are normally produced and able to be shipped. And stock to what you forecast.

But don’t stop there. If, even spacing out the orders and shipments, you can’t reasonably stock to demand, or, if the demand may not be high enough to minimize your logistics costs (via full container shipments), then you need to work on demand shaping as well as demand forecasting. Don’t over market / promote / sell a product you’ll have trouble delivering, and don’t maintain a product that isn’t going to optimize your economic order quantity.

Not everyone needs the newest product, or the top of the line product, some just need a product that works, which can be last year’s product, or the mid-line product. If you shape demand properly, through targeted marketing, targeted selling, or proper account management, you can make sure that you can meet all of your demand and keep each product line you should be maintaining profitable. And while we admit demand shaping can be harder than forecasting, sometimes it needs to be done. But it needs a lot of advance planning, so it’s critical that Procurement work hand in hand with Marketing and Sales to help identify the demands it can safely meet, when, and what demand levels are optimal for each product line. But if you integrate your planning, marketing, forecasting, sales, and supply chain planning, then maybe the holiday season will, in 2024, be the most wonderful time of the year.

COUPA: Centralized Optimization Underlies Procurement Adoption …

… or at least that’s what it SHOULD stand for. Why? Well, besides the fact that optimization is only one of two advanced sourcing & procurement technologies that have proven to deliver year-over-year cost avoidance (“savings”) of 10% or more (which becomes critical in an inflationary economy because while there are no more savings, negating the need for a 10% increase still allows your organization to maintain costs and outperform your competitors), it’s the only technology that can meet today’s sourcing needs!

COVID finally proved what the doctor and a select few other leading analysts and visionaries have been telling you for over a decade — that your supply chain was overextended and fraught with unnecessary risk and cost (and carbon), and that you needed to start near-sourcing/home-sourcing as soon as possible in order to mitigate risk. Plus, it’s also extremely difficult to comply with human rights acts (which mandate no forced or slave labour in the supply chain), such as the UK Modern Slavery Act, California Supply Chains Act, and the German Supply Chain Act if your supply chain is spread globally and has too many (unnecessary) tiers. (And, to top it off, now you have to track and manage your scope 1, 2, and 3 carbon in a supply chain you can barely manage.)

And, guess what, you can’t solve these problems just with:

  • supplier onboarding tools — you can’t just say “no China suppliers” when you’ve never used suppliers outside of China, the suppliers you have vetted can’t be counted on to deliver 100% of the inventory you need, or they are all clustered in the same province/state in one country
  • third party risk management — and just eliminate any supplier which has a risk score above a threshold, because sometimes that will eliminate all, or all but one, supplier
  • third party carbon calculators — because they are usually based on third party carbon emission data provided by research institutions that simply produce averages for a region / category of products (and might over estimate or under estimate the carbon produced by the entire supply base)
  • or even all three … because you will have to migrate out of China slowly, accept some risk, and work on reducing carbon over time

You can only solve these problems if you can balance all forms of risk vs cost vs carbon. And there’s only one tool that can do this. Strategic Sourcing Decision Optimization (SSDO), and when it comes to this, Coupa has the most powerful platform. Built on TESS 6 — Trade Extensions Strategic Sourcing — that Coupa acquired in 2017, the Coupa Sourcing Optimization (CSO) platform is one of the few platforms in the world that can do this. Plus, it can be pre-configured out-of-the-box for your sourcing professionals with all of the required capabilities and data already integrated*. And it may be alone from this perspective (as the other leading optimization solutions are either integrated with smaller platforms or platforms with less partners). (*The purchase of additional services from Coupa or Partners may be required.)

So why is it one of the few platforms that can do this? We’ll get to that, but first we have to cover what the platform does, and more specifically, what’s new since our last major coverage in 2016 on SI (and in 2018 and 2019 on Spend Matters, where the doctor was part of the entire SM Analyst team that created the 3-part in-depth Coupa review, but, as previously noted, the site migration dropped co-authors for many articles).

As per previous articles over the past fifteen years, you already know that:

So now all we have to focus on are the recent improvements around:

  • “smart scenarios” that can be templated and cross-linked from integrated scenario-aware help-guides
  • “Plain English” constraint creation (that allows average buyers & executives to create advanced scenarios)
  • fact-sheet auto-generation from spreadsheets, API calls, and other third-party data sources;
    including data identification, formula derivation and auto-validation pre-import
  • bid insights
  • risk-aware functionality

“Smart Events”

Optimization events can be created from event templates that can themselves be created from completed events. A template can be populated with as little, or as much as the user wants … all the way from simply defining an RFX Survey, factsheet, and a baseline scenario to a complete copy of the event with “last bid” pricing and definitions of every single scenario created by the buyer. Also, templates can be edited at any time and can define specific baseline pricing, last price paid by procurement, last price in a pre-defined fact-sheet that can sit above the event, and so on. Fixed supplier lists, all qualified suppliers that supply a product, all qualified suppliers in an area, no suppliers (and the user pulls from recommended) and so on. In addition to predefining a suite of scenarios that can be run once all the data is populated, the buyer can also define a suite of default reports to be run, and even emailed out, upon scenario completion. This is in addition to workflow automation that can step the buyer through the RFX, auto-respond to suppliers when responses are incomplete or not acceptable, spreadsheets or documents uploaded with hacked/cracked security, and so on. The Coupa philosophy is that optimization-backed events should be as easy as any other event in the system, and the system can be configured so they literally are.

Also, as indicated above, the help guides are smart. When you select a help article on how to do something, it takes you to the right place on the right screen while keeping you in the event. Some products have help guides that are pretty dumb and just take you to the main screen, not to the right field on the right sub-screen, if they even link into the product at all!

“Plain English” Constraint Creation

Even though the vast majority of constraints, mathematically, fall into three/four primary categories — capacity/allocation, risk mitigation, and qualitative — that isn’t obvious to the average buyer without an optimization, analytical, or mathematical background. So Coupa has spent a lot of time working with buyers asking them what they want, listening to their answers and the terminology they use, and created over 100 “plain english” constraint templates that break down into 10 primary categories (allocation, costs, discount, incumbent, numeric limitations, post-processing, redefinition, reject, scenario reference, and collection sheets) as well as a subset of most commonly used constraints gathered into a a “common constraints” collection. For example, the Allocation Category allows for definition “by selection sheet”, “volume”, “alternative cost”, “bid priority”, “fixed divisions”, “favoured/penalized bids”, “incumbent allocations maintained”, etc. Then, when a buyer selects a constraint type, such as “divide allocations”, it will be asked to define the method (%, fixed amount), the division by (supplier, group, geography), and any other conditions (low risk suppliers if by geography). The definition forms are also smart and respond to each, sequential, choice appropriately.

Fantastic Fact Sheets

Fact Sheets can be auto-generated from uploaded spreadsheets (as their platform will automatically detect the data elements (columns), types (text, math, fixed response set, calculation), mappings to internal system / RFX elements), and records — as well as detecting when rows / values are invalid and allow the user to determine what to do when invalid rows/values are detected. Also, if the match is not high certainty, the fact-sheet processor will indicate the user needs to manually define and the user can, of course, override all of the default mappings — and even choose to load only part of the data. These spreadsheets can live in an event or live above the event and be used by multiple events (so that company defined currency conversions, freight quotes for the month, standard warehouse costs, etc. can be used across events).

But even better, Fact Sheets can be configured to automatically pull data in from other modules in the Coupa suite and from APIs the customer has access to, which will pull in up to date information every time they are instantiated.

Bid Insights

Coupa is a big company with a lot of customers and a lot of data. A LOT of data! Not only in terms of prices its customers are paying in their procurement of products and services, but in terms of what suppliers are bidding. This provides huge insight into current marketing pricing in commonly sourced categories, including, and especially, Freight! Starting with freight, Coupa is rolling out a new bid pricing insights for freight where a user can select the source, the destination, the type (frozen/wet/dry/etc), and size (e.g. for ocean freight, the source and destination country, which defaults to container, and the container size/type combo and get the quote range over the past month/quarter/year).

Risk Aware Functionality

The Coupa approach to risk is that you should be risk-aware (to the extent the platform can make you risk aware) with every step you take, so risk data is available across the platform — and all of that risk data can be integrated into an optimization project and scenarios to reject, limit, or balance any risk of interest in the award recommendations.

And when you combine the new capabilities for

  • “smart” events
  • API-enabled fact sheets
  • risk-aware functionality

that’s how Coupa is the first platform that literally can, with some configuration and API integration, allow you to balance third party risk, carbon, and cost simultaneously in your sourcing events — which is where you HAVE to mange risk, carbon, and cost if you want to have any impact at all on your indirect risk, carbon, and cost.

It’s not just 80% of cost that is locked in during design, it’s 80% of risk and carbon as well! And in indirect, you can’t do much about that. You can only do something about the next 20% of cost, risk and carbon that is locked in when you cut the contract. (And then, if you’re sourcing direct, before you finalize a design, you can run some optimization scenarios across design alternatives to gauge relative cost, carbon, and risk, and then select the best design for future sourcing.) So by allowing you to bring in all of the relevant data, you can finally get a grip on the risk and carbon associated with a potential award and balance appropriately.

In other words, this is the year for Optimization to take center stage in Coupa, and power the entire Source-to-Contract process. No other solution can balance these competing objectives. Thus, after 25 years, the time for sourcing optimization, which is still the best kept secret (and most powerful technology in S2P), has finally come! (And, it just might be the reason that more users in an organization adopt Coupa.)