Subscribe to our free, weekly email newsletter!


Small businesses will keep lean inventories

The implications for supply chain managers suggest that inventories will remain lean
By Patrick Burnson, Executive Editor
July 10, 2012

After slow but steady improvement over the first half of this year, small business optimism soured considerably in June, said analysts at IHS Global Insight. The implications for supply chain managers suggest that inventories will remain lean.

“It appears small businesses are trying to make do with their current resources,” said IHS senior economist, Leslie Levesque. “They have run down inventories to better meet their less fruitful sales expectations and the net percentage of owners reporting stocks too low was unchanged in the month.

Levesque added that Small business owners became more downbeat on almost everything in the month, but particularly, their outlook on the economy and earnings potential worsened significantly.
Additionally, she said, small businesses are asking more out of their existing employees or hiring temporary workers. The net percentage of respondents planning to increase their full-time work force fell to 3 – its lowest level since October.

“It is clear from this report that small business owners are not expecting to do much additional capital spending, hiring or expanding in the next three months,” said Levesque.

A more positive outlook on credit conditions does not mean much in this type of environment, IHS analysts added. Small businesses will not increase spending or their labor force until they see demand pick up, feel less uncertain on policy issues, and do not feel so “over-regulated.”

About the Author

image
Patrick Burnson
Executive Editor

Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at .(JavaScript must be enabled to view this email address).


Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

UPS today announced diluted earnings per share of $1.32 for the third quarter 2014, a 13.8% improvement over the prior year period. Operating profit increased 8.3%, resulting from balanced growth across all three segments.

The Department of Transportation’s Bureau of Transportation Statistics (BTS) reported this week that U.S. trade with its North America Free Trade Agreement (NAFTA) partners Canada and Mexico increased 4.4 percent from August 2013 to August 2014 at $100.6 billion.

As expected, global trade dipped from August to September but still saw annual gains, according to data issued this week by Panjiva, an online search engine with detailed information on global suppliers and manufacturers.

Transportation and logistics merger and acquisition (M&A) activity in the third quarter saw annual gains, which were driven by smaller deals in the trucking logistics, shipping, and passenger air sectors, according to data issued in the Intersections report by PwC this week.

With the holidays rapidly approaching, it appears retailers are not quite done getting inventory set up and on the shelves in time for what is expected to be a fairly active shopping season. That much was evident based on recent data for September volumes issued by the Port of Los Angeles (POLA) and the Port of Long Beach (POLB).

Article Topics

News · Global · Supply Chain · Logistics · All topics

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2013 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA