By James Treece, Automotive News
Detroit, Michigan -- Supply-chain managers have one over-riding goal: cut costs.
That's the implication of a survey released Thursday by consultants Grant Thornton and it won't come as a surprise in the auto industry.
When asked the top supply-chain management priorities, 73 percent of survey respondents said, "Reduce costs across the supply chain." Another 59 percent said, "Reduce internal costs." Multiple responses were allowed.
No other answer drew a nod from even half the respondents.
For auto parts suppliers, cost-cutting by their customers has been a given for many years. In North America those cost cuts, coupled with lower production, have put many auto suppliers out of business. More than 20 suppliers tracked by Automotive News have filed for bankruptcy protection in US courts this year. And that figure doesn't include smaller companies and firms that went out of business without filing for bankruptcy.
In the Grant Thornton survey, only 40 percent of respondents chose the next most common priority: "Grow the business."
Reducing inventory, either internally or across the supply chain, drew responses in the low 30 percent range.
Lagging all other answers was "improve new product development," at just 12 percent.
"Using the supply chain to lower costs has long been important to our clients," Wally Gruenes, national managing partner of Grant Thornton's Consumer and Industrial Products practice, said in a statement.
"But increasingly, there is acknowledgment that effective supply chain management creates real value for the organization," he said. "This added value is typically realized by reducing inventory levels throughout the supply chain."
The survey also looked at supply chain managers' efforts to go green, and their concerns when selecting transportation and logistics providers.
The survey was conducted by Grant Thornton, the Institute for Supply Management and Clear Seas Research, a unit of BNP Media. The survey, the last in a series of three, drew more than 200 responses from readers of World Trade Magazine and members of the Institute for Supply Management. The responses were gathered from 5 May to 1 June.
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