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Over the past several weeks, vessels on the Red Sea have faced attacks, leading companies to change their routes and leading to a spike in freight rates. The Red Sea separates the coasts of Saudi Arabia and Yemen to the east from Egypt, Sudan, and Eritrea to the west. With this body of water acting as one of the leading trade routes between Asia, the Middle East, and Europe, freight prices are jumping, creating longer transit times around Africa and disrupting and delaying product deliveries.

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Corporate America and foreign countries have seen China as the world’s factory for decades. Its hundreds of millions of consumers called it “one of the biggest opportunities,” and predictions were made that this would be “China’s century.” China became a major manufacturing hub in the late 1970s and early 1980s, opening the country's economy to foreign investment. Yet, that is all set to change as foreign companies shift investments and their Asian headquarters out of China.

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A Sriracha shortage has struck the aisles of supermarkets all across the world. Although this issue has only recently come into the spotlight, this fan-favorite hot sauce, in its green-capped bottle, has been hard to find for years. The sauce's parent company Huy Fong Foods does not have enough of one of its key ingredients, jalapeno chili peppers, to make its product, and supply chain issues may be to blame. 

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The Panama Canal, one of the world’s largest trading channels, has been dealing with a severe drought this spring and summer, and is expected to continue to experience serious dryness in upcoming months. Panama has two seasons in a year: a dry season and a rainy season. Though the rainy season usually runs from late April until late November, Panama is still experiencing the lowest amount of rainfall since 2000. The unusual drought has caused lower water levels in the canal. According to Boris Moreno, the Vice President of Operations for the channel, the lakes that the passage depends on have close to minimum water levels. 

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Crocs, the famous foam clogs, have experienced a surge in sales during the Covid-19 pandemic. What is especially interesting is that after the pandemic, they are continuing to grow. The company reported in a press release that Crocs sales have increased by over 30% in the first quarter of 2023. This continued growth highlights how the pandemic has benefited some businesses, particularly those with a solid international presence and marketing strategies.

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The technology industry has seen a lot of ups and downs throughout the last three years, especially after the end of the pandemic. However, through the boom of technology created and engaged with during the pandemic, the tech industry is looking at a continuing rise of activity; but, is that truly what will happen?

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In China, many business owners are excited  for a new year with no restrictions as China has lifted the Zero COVID-19 Policy. On December 7th, 2022, China put an end to this policy. The critical question is what this means for China’s economy for the coming years and the effect on the supply chain. The world is connected through China-centric supply chains, and any ‘delay’ in those chains causes global production and the world economy trouble. The abrupt move away from the Zero COVID policy could mean that China may begin focusing once again on economic growth. However, China is now facing new supply chain issues and a wave of COVID-19 sweeping through the country, impacting the growth of these newly opened supply chains.

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As the world continues to resurrect itself amidst the pandemic, another tragedy has struck. Hurricane Ian, a category four storm, has ravaged the state of Florida more than anyone expected. A few major cities in the area were warned of the destruction that the storm was expected to bring, including Miami, Fort Myers, Tampa, Atlanta, Jacksonville, and many more. Hurricane Ian caused extensive damage and flooding to the housing and infrastructure as it transformed from a tropical storm to a hurricane. On top of this, the entire eastern end of Cuba was hit, causing 1 million people to lose power. With Hurricane Ian leaving its mark up the eastern coast to South Carolina, the wind damage alone is ranking this as the fifth-strongest storm to hit the United States, tied alongside many others. The size and magnitude of the storm were intense compared to past storms, leaving Florida and bordering states expecting major effects on supply chain functions along the coast.

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An energy crisis brewing in Europe could end many businesses and lead to a global supply chain disaster for an already struggling system. Two large industries affected by this will be the metals sector and the agricultural sector. With these significant sectors at risk, European governments are attempting to face this problem every day to see how they may be able to stop this issue as fast as possible.

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In March 2020, a COVID-19 outbreak in China forced the rest of the world to shut down for the first time in a century. The COVID-19 pandemic swept the earth leaving detrimental effects on the world, with supply chain bottlenecks occurring in every industry. Two years later, China is ordering another lockdown on its country, implementing its Zero-Covid policy with large effects on the global market.

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Since the beginning of February, some Canadians have been deep into a series of protests called the "Freedom Convoy." This protest is led by truckers in response to vaccine mandates from the Canadian government, which says that you must have a COVID-19 vaccine to cross the United States-Canadian border. Hundreds of trucks and truckers have participated in this protest. They began their blockade at the busiest route that links Canada to the United States and has since spread out into the surrounding areas.  In an act of rebellion, the trucks have been honking their horns for hours on end. Canadian citizens living near the protests grew increasingly frustrated, which led to Prime Minister Trudeau invoking the Emergencies Act, which allows the Canadian federal government to have temporary powers to do whatever may be necessary to stop the protests. The enactment of the Emergencies Act has led to arrests and decreased protests. Additionally, those who engage in the protests now run the risk of having their funds frozen by their banks, which could prevent some people from paying their own bail after being arrested for charges related to the protests.

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As every country rides out the spiking of the Omicron variant, hopeful to see some type of stabilization from it, many have chosen to close their borders to people and businesses for a few weeks to avoid overwhelming hospitals. We’re seeing tighter restrictions and harder borders than we’re used to outside of the COVID-19 Pandemic world. As more variants continue to rise, it would be a good idea to look into how border closings affect businesses, customers, and how you may prepare your business for another possible closure.

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Since the start of the coronavirus pandemic, supply chains all around the world have experienced disruptions. Specifically, the logistics industry has felt a great deal of disruption. Trucks move 72% of the goods we consume in the U.S. economy, so they are a key part of many supply chains. Countries such as Germany, France, Denmark, and Norway are also experiencing truck driver shortages. As the trucking workforce ages, recruiters face challenges recruiting and keeping women in the workforce, the Coronavirus pandemic, and much more have all led to a decrease in the number of working truck drivers; there is no central cause for this shortage, but rather it is several issues and concerns that have led to this shortage. To combat this shortage, supply chain experts are starting to utilize different technologies and alternative solutions to replace drivers.

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There are hundreds of semiconductor chips that make up the global silicon industry. As technology advances, these chips run powerful computers, the flashy iPhones in our pockets, and even some toothbrushes. More recently and as a result of the pandemic, the demand for semiconductors is continuing to overpower supply. These chips convey basic instructions and make sure businesses are running smoothly. Without these tiny chips, car production has been brought to a halt.

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The holiday season may not feel like “the most wonderful time of the year” for many supplies chain and logistics companies this upcoming holiday season. Since the start of the COVID-19 pandemic, the world has come to understand what supply chain management is, as just about everyone has been affected by a supply chain management issue in one way or another; stockouts, delayed package deliveries, and struggling to find certain products on the shelves are struggles that many of us have faced over the last year and a half. Yet, despite the increasing number of vaccinated individuals, we are still expecting to feel the impacts of the pandemic in our supply chains for months to come.

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While the holiday season is still a couple of months away, retail companies are preparing to face the looming pressures of the busiest stint of the year. Early predictions show an astounding 7-9% expected increase in retail sales and an 11-15% expected increase in E-commerce sales this holiday season, but companies are wildly unprepared for this increase in demand, as they are dealing with factory closures, shipping container shortages, and labor shortages.

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It’s no surprise that the effort to get the global economy back to its pre-pandemic efficacy would be quite challenging. The biggest current hurdle to that goal is what some are calling a global energy crisis. The supply of fossil fuels is struggling to catch up with recovering demand, causing energy prices to soar around the world, especially in the Northern Hemisphere as countries prepare for a cold winter. Many factors have contributed to this supply crunch, including European and Asian countries’ recent efforts to decarbonize the economy, lack of capital to natural gas drillers, and an unexpectedly low output from Russian energy suppliers like Gazprom.

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Last week, U.S. President Joe Biden signed an executive order that directs a review of supply chains that have been negatively affected due to the pandemic. The review is focused on four products—semiconductors, minerals and rare earths, pharmaceuticals, and advanced batteries. The goal of this executive order is to increase the domestic production of these products as well as increase imports from ally countries. The order mainly prioritized and placed heavy emphasis on semiconductors, as it included a $37 billion fund to dramatically increase semiconductor or “chip” manufacturing in the U.S.

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Since the coronavirus pandemic began last year, billions of dollars have been poured into the development of vaccines to protect people against the coronavirus. There are currently 12 developers working on—or that have produced—a coronavirus vaccine, including developers in China, India, Russia, the United Kingdom, Sweden, and Germany. Out of these 12 developers, 10 of these vaccines have been approved for use in one country or more. Because of the amazing and swift work of these developers, over one hundred million doses have been given worldwide, but the distribution of these vaccines is stirring discontent and requests for better vaccine distribution between all countries. Only 42 countries have begun administering the first doses of coronavirus vaccines, while there are over 130 countries that have not vaccinated a single person. Out of those 42 countries, 10 countries have been able to obtain and administered 75% of all of the coronavirus vaccines produced. This blog will dive into the current statistics on country vaccinations, why this problem persists, and which countries all of these vaccines are going to.

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In the year 1760, the industrial revolution seized the attention of the world as rapid technological advancements were made nearly everywhere. With it came massive infrastructure development—and a heavy load of carbon dioxide and other greenhouse gases. Since then, the rate at which these pollutants have entered our atmosphere has only increased exponentially, with current levels more than 2x what they were in 1760, a potential recipe for disaster sometime in the future.

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Xinjiang is an autonomous region of Northwest China, known for its vast deserts and mountains. Xinjiang is inhabited by several ethnicities, namely the Uyghur people of Turkish descent and the Han people of Chinese descent. The Uyghur and the Chinese have a long history of discord stemming from their religious differences, though it wasn’t suspected that there was severe oppression against the Uyghur people from the Han until early in 2020. It is now widely believed that the Chinese government has detained up to a million Uighurs over the past few years in “re-education camps.”

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The coronavirus pandemic is seeing a large and hopeful light moving forward: the vaccine. Each country is putting together different plans to face the COVID-19 pandemic head on. Canada, the United Kingdom, and the United States are among the first countries to start distributing the vaccines with varying methods. Canada and the UK are both identifying priority groups and using their national healthcare to evenly distribute the vaccine to healthcare workers and to the elderly. The United States has taken a different approach, allowing every state to define its own priority groups and how they will distribute the vaccines. The COVID-19 vaccine has been highly anticipated but has created new, unforeseen problems due to distribution and transportation. A few unexpected companies have risen up to match the challenges of distribution, storage, and space requirements.

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Among the panic of the COVID-19 a very peculiar phenomenon is happening around the world: Panic Buying. Spain has called for calm, Europe is urging its people to buy rationally, and the United States is working through getting more supplies on its shelves. Panic buying is creating shortages of items around the world and is affecting the supply chains of many different products. But what exactly is panic buying and how is it affecting the markets and companies working within a specific industry?

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Early into the new year, waves of protests have emerged in Canada. Indigenous activists have begun to organize demonstrations to object the construction of a 670-kilometer pipeline (the Coastal GasLink pipeline) that passes through indigenous lands. One native group that opposes the project is known as the Wet'suwet'en, located out of British Columbia. The Wet'suwet'en did propose alternate routes to Coastal Gaslink, but the routes were rejected in favor of a path that was more technically viable and minimized environmental impact. Coastal Gaslink claims to have consulted with Aboriginal groups in the process of planning the route.

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In today's digitized world, everything is shifting to incorporate technology, especially the retail industry. Customer preferences are changing, and companies have to quickly adjust their strategies and style in order to stay competitive. For example, online retail has been in the spotlight for the last decade. It is convenient for both the customer and the retailer; however, how does it affect the manufacturer's and retailer's supply chains?

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For the past 7 quarters, the global manufacturing industry’s main concern has been labor shortages. These shortages are due in large part to a lack of workers with technical skills. Other factors include increasing retirement rates, growing complexity in the global supply chain, and academia. The global manufacturing labor shortage could exceed 8 million people by 2030, resulting in a possible revenue loss of $607 billion. Countries that already struggle with shortages are expected to get worse. Over the next 20 years, Hong Kong’s shortage of manufacturing workers will equate to nearly 80% of its industry workforce.

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As globalization continues, companies around the world are diversifying their supply chains and exploring outsourcing options. Expectations for supply chains are steadily increasing. The goal is for consumers to receive goods at lower prices and higher qualities in a timely manner. However, these are all contingent upon the political atmosphere. A company's supply chain in a particular country depends heavily on the restrictions on market access, transport and logistic services infrastructure, and the business environment.

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This past week, the Midwest United States was swept by a deadly winter storm. With wind chills, some areas' temperature reached a staggering negative 60 degrees Fahrenheit. Extreme weather, like this storm, impedes many industries and processes, creating inconveniences and delays. In response to weather, many factors change including demand, production, and delivery. As a result, the supply chains of numerous companies have been impacted in a negative way.

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By some accounts, moving is ranked as the third-most stressful event a person can experience, after death of a relative and divorce. Two Men and a Truck started as an after-school business (Video: The Story of the Stickmen) for two high school boys in Lansing, Michigan. As a small business focused on local moving services, the company began in 1985 with $350, a hand-drawn logo, and an advertisement in a local community newspaper.

In 1989, Melanie Bergeron, the daughter of founder Mary Ellen Sheets, opened the first franchised office of Two Men and a Truck in her hometown of Atlanta, Georgia. Melanie is now board chair, with Brig Sorber as the chief executive officer and Jon Sorber as executive vice president. Randy Shacka, who joined the company as an intern in 2001, was promoted in 2012 to president, and Brant Hartle is the Chief Financial Officer. Shacka is the first president of the company who did not come from the family.

Two Men and a Truck is no longer “two men and a truck.” The company has grown both domestically and internationally to most of the United States and some 380 locations worldwide.

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Elon Musk, the CEO of Tesla, released 30 brand new Model 3 electric vehicles to Tesla employees in Fremont, California on July 28. Tesla advertises the Model 3 as one of the most affordable electric vehicles on the market, competing with fuel-efficient cars like the Hyundai Ioniq EV, Chevrolet Volt, BMW i3, and Nissan Leaf. While demand for the Model 3 is high—it has already gathered 50,000 advanced deposits—the vehicle’s mass-market accessibility is not as apparent. In comparison to Tesla’s Model S, which can be prepared for delivery in seven days, current customer orders for the Model 3 are expected to be ready within the next 12-18 months. What is the underlying cause of such a large disconnect between consumers and the product? The reason boils down to an exponential increase in production that connects directly to a supply chain that has “about 30 percent of its components coming from abroad.”

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Since implementing market reforms in 1978, China has recognized the fastest sustained economic expansion in history, with GDP growth averaging almost 10%. Much of China’s assent to the second largest economy in the world can be attributed to the growth and development of their manufacturing industry. In 1990, China accounted for less than 3% of the global manufacturing output by value; today they account for nearly 25%. However, the economic and demographic trends that stimulated China’s meteoric rise are shifting and China is being forced to shift their manufacturing strategies to remain on top of global manufacturing.

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[This blog post is based on a presentation I gave in a business-academic panel “jam session” at the American Marketing Association Summer Educators’ Conference, August 6, 2016. The slides with charts and data can be downloaded here].

The strategic importance placed on leveraging global supply chains has seen an exponential increase in the last decade. The world is now connected in a cogwheel fashion, where all 195 countries leverage inbound and outbound elements of global supply chains, and what happens in one part of the world – seemingly far away from where you are – oftentimes has an effect on what you do, perhaps even as a bullwhip effect; that is, small changes in some parts of the world has large cause-effect relationships with other parts.

Tremendous inbound and outbound growth in supply chain traffic has been seen in Asia, with lots more inbound in the last decade than ever before. But, the idea of “supply chain management” is still driven by the U.S. and to some degree Europe. These global supply chains are important given that customers expect the world to become more globalized than the companies expect to have to deliver in the next 20 years. This mismatch needs to be solved.

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Companies’ supply chains should be strategic, analytical, total value systems that are focused on bottom-line profit. The days when supply chains were an operational activity to get a truck from point A to point B are long gone. The leverage that supply chains need to give companies and, by extension, customers is telling.

Nowadays, depending on where you live, some 70 to 90 percent of what we buy for regular consumption and use are not made in our local area. And supply chains are increasingly becoming more strategic; companies leveraged supply chains for 17 percent of their strategy in 2005 and now that number is 21 percent.

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Warehouses are becoming increasingly more complex according to a report by Zebra Technologies, a company which sells bar code scanners and other technologies. These products allow companies to track and manage their business operations in an efficient manner. In its most simple terms, warehousing is the process of storing materials and filling orders from one end of the supply chain to the other.  In response to the growing needs of e-commerce, major changes in labor and technology will be occurring within these warehouses. According to the report, in 2015, it took 60.4 hours to train new staff to “full productivity”, up 26% from 2013. This figure just further demonstrates that companies are already adjusting their supply chains to meet demand for faster delivery by consumers.

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In 2014, 75 ships were lost at sea around the world, which is the lowest number in the last ten years. According to insurer Allianz Global Corporate and Specialty, sinking and submerging was the most common cause of ship loss, with 49 of the 75 losses resulting from this. Despite a downward trend in ships lost per year over the last decade, it is feared that the increasing size of container ships will make losses much more costly.

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When out shopping and buying clothes and other apparel merchandise, a lot of people forget how far a product has come.  The supply chains of the apparel and textile industry have been under a lot of scrutiny and are in need of change.  Whether this change is for the rights and conditions of workers or to accommodate the ever changing online market, current conditions will not last much longer.

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The resurging automotive manufacturer, Ford Motor Company, has made a big splash on the international automotive and commodity industries with their revolutionary light-weight body design. Thanks to Ford securing a hefty amount of aluminum for their flagship product, automakers are scrambling to prepare their supply chains to handle the next big metal demand. This comes at a critical time when the international aluminum market is suffering. Though the metal is in healthy supply, stockpiles are entangled in financial transactions making it hard to get aluminum at all. 

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As the world continues to integrate the globe becomes more interconnected with complex supply chain systems. This becomes even more important now that countries are becoming evermore specialized in one industry or another. An interesting development where countries are specializing is in the arena of patents.

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Earlier this week, my colleague Kyle Brown asked the question “Isolated Issue or Global Supply Chain Problem?”  This question was addressing the recent uncovering that many of the products we believe to be 100% beef, actually contain a fair amount of horse meat.  It would seem that this question has been answered relatively quickly with a new Oceana report released yesterday. Oceana is an advocacy group for the world’s oceans that has sampled over 600 outlets in 20 states over a two year period in one of the most comprehensive food and health studies done in recent years.

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There is currently an ongoing investigation into a food scandal in Europe involving horsemeat found in beef products. Because of the bond that horses have shared with humans as companions throughout history, eating horsemeat is considered taboo in many cultures. The issue came to light when meat that was listed as beef in supermarkets in Ireland and the U.K. was found to contain horsemeat. This scandal poses a threat to international supply chains and brings up a very important topic: how safe is the global food supply chain?

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Back in 1965, Fred Smith wrote a paper for his Yale undergraduate economics class that proposed an overnight package delivery service in which one carrier would be responsible for a piece of cargo from pick-up to delivery. This idea was unorthodox in the delivery of packaged materials at the time, as cargo shipment in the supply chain was handled by a multitude of companies. Smith received a grade of “C” on the assignment, because the professor told him that the idea was “not feasible”. Fast forward nearly 50 years, and Fred Smith is the founder/CEO of FedEx, a $28 billion company that transformed the way packages are delivered. His idea would revolutionize the package transportation industry, but this was not an overnight success story; at one point the company was kept alive by Smith turning the company’s last $5,000 into $27,000 with a gambling trip to Las Vegas. The packaging industry as a whole has changed a lot in the past few decades, thanks in part to massive innovation brought on by people like Fred Smith.

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In an era where globalization perpetually extends the frontiers of international business, a company's ability to have their products reach markets in developing, or even remote, locations has become an increasingly important factor for success in global markets. Statistics support this claim, seeing as the share of gross domestic product as a percentage of the international market in 2012 has clearly shifted from developed countries to nations just emerging in the global economy. This trend has resulted from the growing middle classes of third-world economies having the ability to purchase goods for a higher quality of life, such as safe food, clean water, and secure pharmaceuticals. The astounding international demand for consumer goods has elevated the packaging industry to deliver these goods in frontier markets, while simultaneously trying to reduce their environmental impact during this time of expansion.

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Since the mid-1980s, emerging markets have grown faster than advanced economies. When you think of how hard it once was for smaller economies to grow and globalize, this is an amazing feat. Looking at the current situation can give many aspiring economies hope to grow successfully.

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Excessive flooding in Thailand has not only made life a challenge for locals, but global businesses are experiencing hardships due to the harsh monsoon season as well. Many technology suppliers are located in Thailand and have suffered because of the massive flooding and have caused a significant supply chain back up. Several have lost large amounts of inventory and suffered excessive property damage. Some say it could take up to a year for these plants to begin operating at normal capacity again.

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Supply chains have received a lot of attention lately including being featured in globalEDGE’s April Newsletter on the emerging industry of Reverse Supply Chains. However, another important part of a product’s life cycle is end-of-life management. Historically consumers’ only choice was to throw unwanted products away and manufacturers could help the environment by reducing packaging or making it biodegradable. Many consumers are now being offered the opportunity to recycle and companies around the world have sprung up to offer products and services that create profit while helping municipalities and citizens "Go Green!"

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As we are wrapping up this globalEDGE blog series of “top trends,” we thought there’d be no better way to finish then with a custom-made list talking about top global business trends as seen by us here at globalEDGE. The list is in no particular order (i.e. trend number 1 is no more prevalent then trend number 5), but we feel that all of these trends are making themselves known in the international marketplace now. Here’s the list!

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One of the fundamental rules of logistics is to avoid shipping air and water whenever possible. Packages and vehicles are optimized to reduce the amount of wasted space that could be used to ship additional products. The weight of water is so expensive to transport that many industries design an entire supply chain around reducing the distance that liquid goods must travel from the point of production to the point of sale. For the flower industry, in which the quality and lifespan of goods are often dependent on the presence of air and water, logistical challenges of doing business on a global scale are of high importance.

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Continuous innovation is essential for companies to remain competitive in any industry. Businesses refusing to adapt to product and process improvements have quickly been left in the dust by competitors. Stability in business is based on the ability of management to consistently and effectively adapt to changes in the external business environment.

In collaborative partnerships, suppliers and customers work jointly to develop products that will be popular on the open market. A recent article published by Michael Schrage in the Harvard Business Review shed some light on how to develop partnerships that are conducive to effective collaboration.

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Nine trillion dollars are spent annually on worldwide logistics costs. When most people look at this figure their heads spins thinking about the number of zeros in that number and the scope of activities that it represents. Corporate leaders have also started to look at this number as a huge opportunity to streamline processes and reduce expenses. Everything from agriculture to manufacturing is being analyzed in a whole new light and directors have been pleasantly surprised by the possibilities.

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In light of the ballooning global cost of providing healthcare to patients, there has been much discussion as to how operations in the healthcare industry can be implemented in a smoother and more cost-efficient manner. One major solution could lie in the efforts of various supply-chain management firms and programs to help hospitals and health care systems reduce their supply chain costs. In addition to supply chain revamps, technological revisions of documentation in the health care industry should have a significant impact in cost-cutting and time-saving.