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Manufacturing Report Finds Increasing Consumer Pressure on Supply Chain Issues
December 14, 2012
Consumers are becoming increasingly sophisticated about global supply chain issues, including where products and their components are made and whether global manufacturers and their suppliers are providing ethical working environments for employees, according to an annual report released by UL (Underwriters Laboratories).
The Product Mindset — which examines manufacturer and consumer perceptions about how products are made, sold, bought and consumed — states that manufacturers are noting increased pressure for transparency related to product, component and raw material sourcing.
This year's findings, culled from interviews with manufacturers and consumers in the United States, China, Germany and India, show a steep decline in optimism and increased expectations about quality, safety and the environment. UL says these expectations are driving more complex supply chain dynamics, where traceability and sourcing are the tools manufacturers are leveraging to help deliver reliable, cost-effective products that consumers are demanding.
"The volatility in today's world is causing companies and people to look at the products they make and consume with more scrutiny than ever before. We are seeing manufacturers showcase aspects of their supply chain as consumers demand more transparency. Where a product's made, how it's made and what's in it are paramount," said Keith Williams, UL's CEO.
The study reveals that product safety remains fundamental and that the environmental orientation of a manufacturer's operations and its product features are growing in importance. Specifically, the study highlights the growing concerns about the origins of manufactured products, including where their components and raw materials are sourced.
"It is clear from this year's report that supply chain issues are top of mind for global manufacturers but also in the line of sight of consumers in both developed and emerging economies. The report strongly suggests that these trends will accelerate in the coming years as manufacturers strive to meet consumer demand for increased quality and safety in the things they purchase and use," stated Clyde Kofman, UL chief strategy officer.
Other insights from the study include:
- Manufacturers are strategically managing increasingly complex supply chains to improve operations and quality and to reduce costs. As a result, global sourcing is likely to expand to new countries in the coming years.
- Manufacturers believe that product safety is increasing in importance to consumers and delivering it is critical to their business success.
- Most consumers do not believe manufacturers use the best possible raw materials, ingredients or components in their products.
- Manufacturers in both developed and emerging nations have a significantly more favorable opinion about the quality of materials sourced from developed markets than about those from emerging markets.
@Bart_King is a freelance writer and communications consultant.