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Week of 13 June 2022: Procurement Today

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When I was a youngster in this industry and new in the mill, part of my orientation was to visit the purchasing department and be shown what they could do for me as a project engineer.

They proudly showed my their "computer system" which operated off a mainframe in a distant city. They told me that with this system they could tell me the status of the delivery of my purchases.

I asked them how this was done. Well, they said, if the date of delivery came and my items were not logged in as being received, they would go on a report that I could ask them to provide to me. Not automatically generated, I had to ask each time I wanted it.

And they only knew it was late if the date required had come and they had not received the item in question. Even way back then, that was poor service.

Today, we need to know the delivery status of items way before their expected delivery date. We even need to know what ship they are on and where that ship is at any given moment.

As shortages continue, this becomes even more important. On projects I am working on right now, I have seen three force majeure incidences in the last 15 months. In the fifty years before the first one of this era, I had never seen any (this doesn't mean things weren't late; the supplier just never claimed force majeure). These have become so frequent that I no longer need spell check to spell force majeure.

Which brings me to the point this week. It may be time to look at the fine print in your purchase order terms and conditions. It just may be that it does not reflect the realities of today's conditions the way you would require if you get stuck with excessive delays.

Time to have your lawyers take a look.

And while you are at it, make sure the safety and liabilities issues reflect what your company desires as well.

Be safe and we will talk next week.


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