Hurricane Harvey hit the Gulf Coast with a vengeance on August 25th, delivering the largest single storm amount of rainfall in the continental USA, ever. We have all seen the devastation and misery inflicted upon the residents of southeast Texas, and our hearts go out to them. If you wish to help fellow Americans in need, make sure you do so effectively and intelligently. See what Consumer Reports or other sources you trust have to say about giving before you break out your checkbook. But once we get past our sympathies, we have to begin to wonder – Will this disaster have any impact on me, or on my business?
The answer is yes, most definitely.
We are all used to seeing above-average rainfall in parts of the Midwest after a named storm system inflicts its mayhem in the gulf area, then meanders along a northeasterly path toward us. But we should expect more than just rain to fall out as a result of Harvey. The Gulf Coast holds about a third of the nation’s refining capacity, and serves as a critically important nexus of America’s “energy superhighway system.” In normal times, crude comes in, refined products go out, either to international markets or other regions of the USA.
But with port operations interrupted, a situation that the US Coast Guard says may take weeks to resolve before shipping channels are safe for large ships and tankers, crude oil destined for import to the USA has no way to enter via its most common port of entry. Therefore, we will see a temporary glut of oil available to the global markets, even though we might face a shortfall in the US due to interrupted infrastructure. More importantly, disrupted refinery operations will generate upward pressure on refined product pricing nationwide, most immediately impacting fuel and plastic resin pricing.
Resin producers have been building a stockpile, which should shield buyers from supply interruptions, but they have been pushing price increases at the same time. Expect more emphasis on price increases, regardless of inventories, resulting from constrained production due to Harvey. Coupled with resin producer maintenance shutdowns, this could be a strong supporting element for producers to keep prices elevated for a significant period.
Likewise, fuel prices are already jumping in the Midwest as a result of Harvey’s impact in the Gulf. So long as gulf region refining capacity remains offline, and pipelines from the Gulf area to other regions of the country operate under capacity, anticipate fuel costs to remain elevated and transportation companies to perhaps begin leveling fuel surcharges.
Harvey will impact crude and refined petroleum products for a significant, but unknown period
Crude Oil and Refined Product pricing will be thrown out of sync, depressing global Crude Oil pricing but pushing refined product pricing higher in the USA
Expect costs for transportation to increase, and don’t be surprised if suppliers attempt freight surcharges due to increasing fuel prices
Monitor refining capacity nationally, and refining capacity utilization regionally to be prepared to push back on surcharge attempts lasting longer than might be justified
Harvey will embolden plastic resin producers to push for increased pricing, and will sustain their efforts
What can you do?
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One remarkable thing about the list is that it rarely changes. The order may change but the top cited standards typically don’t change. Top 10 Sited Safety and Health Violations: 501 - Fall Protection 1200 - Hazard Communication 451 - Scaffolding 134 - Respiratory Protection 147 - Lockout/Tagout 178 - Powered Industrial Trucks 1053 - Ladders 305 - Electrical, Wiring Methods 212 - Machine Guarding 303 - Electrical, General Requirements Three of the 10 sited standards are directed at the construction standard (1926) while other fall within the general industry (1910). It should be noted however that the general industry standard also has fall protection guidelines. Year after year, inspectors see the same on-the-job hazards, any one of which could result in a fatality or severe injury. More than 4,500 workers are killed on the job every year, and approximately 3 million are injured. By understanding these regulations you can improve your safety program and prevent injuries. Give me a call if you have any compliance doubts, or want to review OHSA regulations. Gwido Dlugopolsky at 216-391-7766 or firstname.lastname@example.org
Why does it take a NASCAR pit crew only 15 seconds to change four car tires when it takes people like you and me minutes? The answer is simple SMED. Single Minute Exchange of Dies, or SMED, is a process for reducing the time it takes to do equipment changeovers. Using the principles of SMED you should be able to perform any changeover in your facility in under 10 minutes! The SMED process is simple – convert as many changeover steps as possible to “external”, meaning they are done while your equipment is still RUNNING, while simplifying and streamlining the remaining steps. SMED is broken down into the following 3 Steps: Separate Convert Streamline We found this article to be very helping in explaining the SMED process in more detail: LEAN PRODUCTION - SMED A good first step to achieve this level of SMED efficiency would be to run a kaizen event at your facility to standardize (5S) your tools and supplies. Doing this alone will help you achieve 40% to 50% greater efficiency. Once the “low hanging fruit” is gone, you can still reduce setup times another 20% by practicing more advanced SMED principles.
The secret to closing any sale is to reduce uncertainty in the buyer and replace it with confidence in YOU, your PRODUCT/SERVICE, and your COMPANY. Step 1 – Confidence in YOU Someone buying from you wants to be able to fundamentally connect with you on a human level and feel confident that you’re an expert in what you’re selling If you’re selling paperclips, be an expert in paperclips If you’re selling design and engineering related services, be an expert in design and engineering related services Focus on addressing the problem, not the solution….MEANING you already know you have the solution, connect with the buyer by being an expert with the problem he/she is facing. Prove that you know the problem and all aspects of the problem like the back of your hand. Step 2- Confidence in the PRODUCT/SERVICE you are selling Someone buying from you needs to trust the product/service you are selling will solve their problem. It’s your responsibility to deliver a solution and the benefits associated with it. Basically you need to “Hit a Homerun” communicating this message. Tip – Use Success Stories: Share with the potential buyer examples of your product/service solving problems and delivering value for