Should you swap commodities with your competitors?

“Swapping commodities with other manufacturers instead of shipping internationally can greatly reduce transportation costs and boost profits. Finding the right swap partner will help you avoid the risks that are inherent in these arrangements.”

This quarter’s issue of Supply Chain Quarterly features an insightful article from Alan Kosansky and Ted Schaefer on commodity swaps.

“If you’re under a mandate to make substantial cuts in supply chain costs, you probably have already “picked the low-hanging fruit”—that is, you’ve made the obvious, easyto- achieve improvements. You probably have optimized delivery to your customers by routing orders through the most efficient network of warehouses. It’s likely that you also are sourcing from highly efficient manufacturing plants around the world. And perhaps you have partnered with ocean carriers and leveraged your shipping volumes to negotiate the best rates in the industry….”

You can download the article in PDF form here. CSCMP members and subscribers to the magazine can read the complete article here.

If you would like to learn more about our Supply Chain Optimization services, please contact us here.

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