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Pain in the chain

Posted 16/01/2014 by sevans

Supply chains are very much at the top of the agenda at the moment. In the UK, the restoration of supply chains is a major component of the Chemical Growth Partnership strategy for the future development of the domestic chemical industry (C&I, 2013, 12, 4). However, the chemical industry is not alone in its concerns about the problems of linking up all the aspects on an industry from raw materials through to the final consumer. Around the world, executives are battling with the issues that range from legislation, through costs, to concerns about security and spoilage.

In North America, the majority of logistics executives, around 54%, view increasing regulations and the changes in the healthcare legislation (53%) as the main concerns, according to the sixth annual Pain in the (Supply) Chain Survey, released recently by global logistics specialist UPS. Executives in Western Europe also highlight the same concerns but not to the same degree, being identified by less than 40%of respondents. Meanwhile, in Asia, although increased regulations were cited by over 50% of respondents, a similar number emphasised increasing competition. 

Also in Asia, product security is of more concern than regulatory compliance although both were identified as key issues by over 70% of respondents.

Among healthcare executives, some 75% said they plan to enter new markets over the next five years. However, they also highlighted that the legislative outlook is murky (58%), while new market complexities and the costs involved with managing multiple countries’ requirements were emphasised by 57% and 52%, respectively. The leading markets identified are China (27%), the US (21%), Brazil (18%), and India (13%).

For the first time in this survey, product protection has overtaken cost as a top priority, with 48% of respondents highlighting growing counterfeiting sophistication, inadequate law enforcement (37%), grey markets or parallel trade (30%), and under-regulated wholesalers and re-packagers (28%).

Problems with counterfeiting are well known in the healthcare market; however, the trade in illegal pesticides is also a growing global problem. This week in the UK, a year-long, national industry campaign is being launched to combat this problem. The Watch Out! Campaign is supported by the Voluntary Initiative and Red Tractor Assurance, with funding from the UK Crop Protection Association, the National Farmers’ Union and the Agricultural Industries Confederation.

The Voluntary Initiative is an industry-led initiative , established in 2001, that is designed to develop and promote best practice advice for the use of pesticides in agriculture and horticulture. Its chairman, Richard Butler said: ‘The Voluntary Initiative is all about responsible pesticide use….It is really sad that farmers now have to be aware of the danger posed by unscrupulous professional counterfeiters who want to undermine the professionalism and competence of UK farmers and spray operators.’ 

And that is the key aspect of supply chains, it is all about ensuring that products are produced, moved and used without at any point there being concerns, whether they be regulatory compliance of product security. Unfortunately, there will always be someone looking for a quick profit so everyone from manufacturers, through logistics specialists to the final consumer, cannot afford to not be on their guard.

 

Neil Eisberg - Editor

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