LG Electronics Selects GXS to Support Global ERP and B2B Consolidation

Multi-National Korean Electronics Manufacturer Leverages GXS Trading
   Grid(R) for EDI and XML-Based Integration with Customers and Suppliers

    SEOUL, Korea and GAITHERSBURG, Md., July 16 /PRNewswire/ -- GXS, a
leading provider of business-to-business (B2B) e-commerce solutions, today
announced that LG Electronics, a global leader and technology innovator in
consumer electronics, home appliances and mobile communications, has chosen
GXS Trading Grid(R) to consolidate and centralize its interactions with
more than 200 global trading partners. The move is part of a broader LG
strategy to reduce complexity in its supply chain operations by
centralizing its geographically- dispersed enterprise resource planning
(ERP) systems in Europe, the United States, South America and Asia-Pacific
at its headquarters in Seoul, South Korea and to centralize its B2B
e-commerce functions onto a unified global platform.

    LG reported revenues of $44B in 2007 from four business units -- Mobile
Communications, Digital Appliances, Digital Display and Digital Media. As a
leader in the highly competitive consumer electronics sector, LG's success
depends upon its ability to coordinate supply chain activities and share
real- time information with a network of contract manufacturers, third
party logistics providers and consumer electronics retailers around the
world. GXS Trading Grid supports a broad range of e-commerce standards
(e.g., EDI, XML, KEDIFACT, RosettaNet and AS2) and extensive global reach
throughout Asia, Europe and the Americas. Consolidation of B2B transactions
onto a single vendor, GXS, provides LG's IT organization with centralized
operations in Korea to support its trading partners based in more than 70
countries.

    "Since 2001 GXS has consistently provided LG Electronics with reliable
and effective B2B integration services," said SunYoung (Sarah) Oh,
assistant manager, Information Strategy Team of LG Electronics. "As we've
grown as a company in the last 50 years, so has the complexity of our
supply chain. Reducing that complexity was as important to our company as
ensuring global integration capabilities and increasing real-time
visibility into our trading partner network. GXS is the only B2B
integration vendor we have found that can easily support all three of these
initiatives."

    Prior to consolidating with GXS, LG Electronics used multiple B2B e-
commerce providers that were managed independently by local B2B centers
distributed around the world. The use of multiple vendors led to duplicate
processes and inconsistent capabilities, complicating LG's efforts to
manage its trading partner network. Furthermore, the company was slow to
respond to trading partner needs and incurred higher costs because of
duplicate traffic and an inability to leverage its total transaction volume
to reduce its overall B2B e-commerce costs.

    "Through its move to consolidate its ERP systems and B2B networks, LG
is standing as an example of how a truly global company can operate
efficiently and effectively," said Raymond Teh, vice president of Asia
Pacific for GXS, "Many companies operate in geographic silos when it comes
to their trading partner networks and as a result, they have no idea of the
scope of their networks and cannot gain real-time visibility into
activities. The consolidation of LG's ERP systems will give the company a
competitive advantage in the marketplace. As a global B2B provider with a
local presence in Korea and throughout Asia Pacific, GXS is well positioned
to help other multi-national corporations based in Asia, and anywhere in
the world, consolidate their B2B e-commerce networks."

    GXS Trading Grid is a global B2B e-commerce and integration platform
that supports the creation and adoption of on-demand supply chain
management solutions for companies of any size. As the world's largest
electronic business community, GXS Trading Grid is used by more than 30,000
customers to exchange goods and services, gain visibility into global
logistics operations and to synchronize product data. Trading Grid helps
customers automate global trading communities by shielding complexity from
rapidly changing standards, eliminating manual and duplicative processes
and enabling the highest levels of B2B integration and collaboration.

    About LG Electronics

    Established in 1958, LG Electronics, Inc. (LG) is a global leader and
technology innovator in consumer electronics, home appliances and mobile
communications, employing more than 82,000 people working in over 114
operations including 82 subsidiaries around the world. With 2007 global
sales of USD 44 billion, LG is comprised of four business units - Mobile
Communications, Digital Appliance, Digital Display and Digital Media. LG is
the world's leading producer of Mobile handsets, air conditioners, front-
loading washing machines, optical storage products, DVD players, flat panel
TVs and home theater systems.

    About GXS

    GXS is a leading global provider of B2B e-commerce solutions that
simplify and enhance business process integration and collaboration among
trading partners. Organizations worldwide, including more than 70 percent
of the Fortune 500, leverage the on-demand services on GXS Trading Grid(R)
to extend supply chain networks, optimize product launches, automate
warehouse receiving, manage electronic payments and gain supply chain
visibility. GXS Managed Services, GXS' B2B outsourcing solution, empowers
customers with the expertise, technical infrastructure and program support
to conduct B2B e- commerce with trading partners globally.

Source  :  prnewswire.com

 

Leading UK Manufacturer of Laboratory Plastics Appoints Specialist B2B Agency The Scott Partnership for New PR Campaign

Sterilin Limited, the established leader in single use laboratory plastics for life sciences applications, has appointed independent consultancy The Scott Partnership for a new PR campaign. The Scott Partnership specialises in business-to-business PR communications for the technology, scientific and retail industries.

Formerly part of Barloworld Scientific, Sterilin Limited is a newly formed independent business offering
a wide range of products for the pharmaceutical,clinical and healthcare, food, forensics and industrial packaging industries. The Sterilin brand has been setting world standards for quality, reliability and user safety for more than 40 years, and the newly-established business will continue to offer the high-quality products and excellent service which is synonymous with the Sterilin brand.

Sterilin Limited has selected The Scott Partnership to run its PR campaign due to the agency’s experience of successfully launching new businesses and promoting established brands. The Sterilin Limited PR campaign will be focused towards the healthcare, clinical and pharmaceutical sectors across Europe. Sterilin Limited will benefit from The Scott Partnership’s extensive experience of delivering technical PR campaigns in the life sciences market and its commitment to producing measurable results.

“We are delighted to launch Sterilin Limited into the market,” comments Rachel Adams, Marketing Manager, Sterilin Limited. “The Scott Partnership is the only PR agency we spoke with and is ideally placed to deliver this new campaign.”

Based in the UK, The Scott Partnership boasts a truly global client base, with customers headquartered in the US, UK, Italy and Australia. The company is committed to building long-term relationships to provide the best results for its clients. With the ability to quickly assimilate knowledge on products and services in the technology sectors, The Scott Partnership provides a thorough and detailed campaign for all its clients. The agency conducts Public Relations campaigns for a number of companies that range from small VC-funded start-ups to multi-billion dollar global corporations.

Source  :  pr-inside.com

 

A strong business case for Sustainability – Ernst & Young

Climate change, sustainability and corporate social responsibility have risen inexorably in the public and corporate minds over the last decade, says Ernst & Young.  They go on to state that while businesses and consumers are vying to out do each other’s green claims, the scientific community is issuing increasingly stark warnings about the urgency and depth of cuts required to avoid the most dangerous impacts of climate change.

A survey carried out by Ernst & Young in conjunction with the Economist Intelligence Unit among executives from US$ 1 billion plus corporations to see how organizations view the impact of sustainability on its supply chain and sourcing, indicates a high level of awareness of sustainability, with an appreciation of opportunities it offers within the supply chain. More than half of the respondents to the survey indicated reputation, cost reduction, and revenue growth as the top three opportunities that arise from sustainability. An increased cost base was highlighted as the greatest risk, inferring operational and energy savings will be offset by capital costs and increase in prices from suppliers.

The survey also indicates that a company’s approach to emissions and accountability for its supply chain activity could make or break corporate reputation. 71% of the respondents to the survey view the impact of sustainability on the supply chain as a brand / reputation opportunity allowing to secure competitive advantage. It is thought that supply chains are key to enhancing reputation, both through avoiding risks such as unfair labour practices and using unsustainable material, and in ensuring businesses live up to their carbon reduction promises.

The survey further states that in addition to corporate reputation, cost saving and revenue inducing factors contribute to the business case for sustainability.  These include operational and energy efficiency, energy and carbon trading, and new product development and green marketing. The survey findings also indicate that operational and energy efficiency has become key factors in the review of sustainability, since soaring energy and raw material prices has become significant corporate issues. 50% of organizations in the survey see sustainability as a cost saving issue and significant opportunities exist for this throughout the supply chain.

Energy and carbon trading is a factor that strengthens the business case by creating revenue opportunities. 63% of the organizations in the survey clearly identify sustainability as opportunity for revenue growth with carbon trading schemes and investments in renewable energy generation. To combat rising energy prices and reduce in-house emissions, 40% of firms have invested in on-site renewable energy generation such as onshore wind on telecom sites and biomass combined heat and power at factories. This offers greater control over energy costs, enhances corporate reputations and promises profits from the sale of surplus renewable electricity. Similarly, an increasing number of firms are creating revenue from carbon trading. Under the EU Emissions Trading Scheme, participating firms must operate within an annual emissions cap. Operating outside a designated carbon cap could mean paying for excess emissions. Developing countries that do not have emission caps provide finance for greenhouse gas reduction projects through Clean Development Mechanism in return for Certified Emissions Reduction permits which are sold on the open market to firms with emission caps. Multinational businesses could use this scheme to finance energy efficiency and renewable projects for their developing world sites and suppliers.

Revenue through new product development and green marketing is another opportunity. Energy efficiency legislation promises to phase out energy-intensive products replacing them with more ‘greener’ ones, while consumer campaigns and an abundance of product labels aim to increase demand for more sustainable products and services. Businesses are competing to launch sustainable products and services to increase their market share. While many firms limit innovation to certain products, enhancing their reputations as a result, the real challenge is to mainstream them across existing product ranges.

Further, 65% of the respondents to the survey have taken measures to implement labour standard improvements as action on corporate responsibility aspects of sustainability.

Despite indications that the impact of sustainability results in such a varied range of opportunity and threats, organizations seem to be taking a back-seat when it comes to dealing with it. Only 12% of firms rated sustainability among their top three supply chain priorities. This maybe an indication of the mixed messages businesses receive from governments, regulators and consumers – their three key stakeholders as indicated by the survey. Consumer pressure and PR spin has resulted in some very challenging public commitments resulting in businesses over-promising and under-delivering their commitments. Many large global companies have yet to realize the full potential of the savings and benefits that can be achieved by integrating sustainability issues into their supply chain management. With growing legislation, dwindling resources and increasingly vocal consumers, sustainability will continue to grow in importance as an opportunity for forward thinking firms and a threat to their competitors that fail to act.

Source  :   dailymirror.lk

 

Tri Petch outsources logistics

CEVA Logistics (Thailand) Co is now handling all automotive logistics for Tri Petch Isuzu Sales Co under a new three-year outsourcing contract.

Tri Petch is responsible for the sales and distribution of Isuzu pickup trucks and heavy-duty trucks via a network of more than 300 dealers. CEVA will use its carrier fleet and IT systems to manage the distribution of Isuzu vehicles throughout the country.

“Since we are not professionals in logistics and it is not our core business, we decided to select a specialist global logistics company to handle our logistics operations,” said Panadda Chennavasin, vice-president of Tri Petch.

As well, Tri Petch wants its supply chain to operate to global best-practice levels and to significantly improve sales operations to support the dealer network.

“We hope our operating costs will improve from efficient logistics performance, which will be assessed once a year,” she said.

CEVA will manage Tri Petch’s vehicle supply chain from Isuzu’s plants through to final delivery to dealers. This includes transport of vehicles from plants in Samut Prakan and Chachoengsao to two motor pools, where vehicles are inspected, accessories installed and the vehicles made ready for final delivery to dealers.

A CEVA executive said the company recently began an operational process improvement and re-engineering programme to increase the quality of logistics operations to world-class standards.

The programme involve the establishment of a shared-user vehicle logistics network to be used by other automotive manufacturing and sales companies. This will improve overall efficiency of the supply chain and provide a highly cost-effective operation for Tri Petch and for CEVA’s new customers.

CEVA will use more than 100 car carriers for transport, along with a management and operational team of more than 400 staff.

“This is one of the largest automotive logistics contracts in the Thai market,” said Winfried Kiesbueye, CEVA’s managing director. “Our key aim is to improve the efficiency of Tri Petch’s vehicle handling operation by implementing CEVA’s best-practice lean processes and increasing overall control.”

Source  :   bangkokpost.com

 

UK small caps close just off session high; Business Direct soars on sale plan

LONDON (Thomson Financial) – UK small caps closed just off their session high today, lifted by solid gains among the blue chips, with Business Direct Group soaring 125 percent amid plans to sell the group in order to secure long-term funding.

At the close, the FTSE Small Cap index climbed 29.0 points to 2,738.8 — with the session higher 2,739.3 — while the FTSE 100 index leapt 101.5 points to 5,420.7.

Business Direct Group rocketed 0-1/4 of a penny to 0.45 of a penny to top the small cap risers, as it said it sees a sale of all or part of the group as the most likely option to secure its future long-term funding.

The logistics company said that a further announcement will be made when appropriate, and that in the meantime it continues to trade normally.

Ark Therapeutics stayed behind, up 32-3/4 pence to 80-1/4 pence, after a drug trial success, although Landsbanki cut the stock to ‘hold’ from ‘buy’, saying the data gives a ‘mixed’ set of results.

The broker thinks the European Medicines Agency may well want the complete data set.

Merger talks took Gladstone Pacific Nickel 24-1/2 up to 85, as it entered into merger discussions with Resource Development International Ltd., (RDI)an unlisted company controlled by Clive Palmer.

Palmer resigned from his role as chairman of Gladstone, along with director Geoffrey Smith, with immediate effect.

In deal news, Silence Therapeutics rose 8-1/2 to 38-1/4 as it said its partner Quark Pharmaceuticals Inc. together with Pfizer, has started a Phase II clinical trial of RTP-801i-14, which will trigger a $1.9 million milestone payment to Silence from Quark.

Deal news also boosted Optare 4-1/2 to 29-1/4, while Ultima Networks and Blinkx rose on product launches, Ultima climbing 0.225 of a penny to 1.925, while Blinkx moved 0-1/4 of a penny higher to 29-3/4.

Positive numbers news lifted Puricore 1-3/4 to 17.

Elsewhere, Formjet climbed 0.175 of a penny to 1.05 as it raised 900,000 pounds by placing 120 mln shares at 0.75 pence apiece to fund the acquisition of a specialist distribution company with a significant customer base of IT resellers and independent retailers.

Irish Life & Permanent rose 0.62 of a penny to 5.17 on receiving the final tranche of term funding required to replace the 3 billion euros of funds maturing in the current quarter.

Kalahari Minerals rose 1-1/2 to 29-3/4 as Extract Resources, in which Kalahari subsidiary Kalahari Uranium holds a 39.11 percent interest, announced a preliminary exploration target at Rossing South of between 126 million and 198 million lb of triuranium octoxide.

But away from the risers and Acertec slumped 6-1/2 to 8 — a 44 percent slide to top the losers — as it said its 2008 profits are to be substantially short of market forecasts.

Ensor Holdings remained 5-1/2 lower to 20, also on a profit warning, while numbers woes took 0-1/4 of a penny from Cinpart, on 2.

Recruitment specialist Prime People closed 9 lower to 44-1/2, as it said net fee income in the first three months of the current financial year was static.

Numbers news also hurt Uniq, 10-1/2 lower to 84, as it posted a wider first-half pretax loss, leading FinnCap and Panmure Gordon to keep ’sell’ ratings on the stock.

In other news, James Cropper stayed hard-hit, 15-1/2 down to 132 as it cautioned it sees a challenging year.

Taihua shed 1-1/4 to 10-1/2 as adverse exchange rate fluctuations between the renminbi currency and the U.S. dollar offset the value of sales.

hannah.benjamin@thomsonreuters.com

hmb/jfr

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Source  :  forbes.com

 

Community group pursuing ambitious agenda for East Side

Community leaders are hoping that a little capital improvement will go a long way in spurring economic development on the city’s East Side.

This past summer, the city wrapped up an $8.8 million capital improvement project on East Commerce Street. The improvement project encompasses an area stretching from the railroad tracks near the downtown freeway south to North Palmetto Avenue.

The project included construction of new curbs, sidewalks, driveway approaches, and the installation of decorative street lights, special benches and an underground utility conversion.

San Antonio City Councilwoman Sheila McNeil (District 2), along with the nonprofit San Antonio for Growth on the Eastside, or SAGE, worked together to get funding for the project and to see it to fruition.

Source   :   bizjournals.com

 

ATG to relaunch lingerie e-tailer Figleaves web store

ATG (Art Technology Group Inc), the premier provider of e-commerce software and platform neutral optimization services, announced that figleaves.com, the world’s largest online retailer of branded lingerie, sleepwear, swimwear, hosiery and underwear, is set to relaunch its online storefront using ATG’s entire e-commerce suite.

A top online intimate apparel retailer, figleaves.com has more than 1 million customers with almost all orders taken online and fulfilled from sophisticated warehouses in Suffolk, UK and a North American warehouse in Windsor, Ontario.

The company carries a vast selection of international brands and has in stock over 40,000 stock-keeping units so as to offer same day dispatch from either the UK or the North American warehouses. The brand portfolio offers something for everyone – at all budgets, shapes and sizes – from Calvin Klein to Simone Perele.

As one of the pioneering fashion e-commerce companies, figleaves.com’s goal is to embrace technology which puts consumers first and allows the retailer a 360 degree view of its customers. Through the marketing and sales cycle to customer service, figleaves.com wanted to offer its customers a consistent and seamless experience.

To achieve this goal it wanted the capability to view a more complete and up-to-date profile of the customers, based on real-time behaviour, preferences and purchasing histories. Only ATG provides such a view for retailers and experience for consumers.

To deliver the most personalised customer experience possible, the company has chosen to relaunch its Web store implementing ATG Commerce, the company’s complete e-commerce suite.

The relaunched site will give figleaves.com a view of its customers across all contact channels and throughout the customer lifecycle. The new site will attract prospects via Web marketing campaigns, and ATG’s merchandising and search capabilities will be used to convert browsers into buyers. The company will also be able to provide consistent and ongoing customer care through ATG’s Commerce Service Center suite.

The highly scalable platform will create engaging and branded customer experiences across every touch point including the Web, e-mail, call centres, and mobile devices. It will also empower figleaves.com’s marketers and merchandisers by enabling them to manage directly all aspects of the e-commerce site including catalogues, pricing, marketing, promotions, search facets, campaigns and reporting.

The company has purchased and will be using ATG Recommendations on its current platform and future ATG platform to automatically deliver more individual product recommendations to its customers. Further, figleaves.com will utilize ATG’s eStara Click To Call product, an offering that turns a retailer’s call center into a sales center by providing an immediate human connection with consumers when needed. Click to Call engages buyers proactively and moves them seamlessly from the Web into live dialogue, creating a truly personal one-to-one experience in order to close sales.

Source by Fibre2fashion

 

Wal-Mart tops the list once again among top 100 retailers

Though the retail climate has changed dramatically in the last year, the top retail power players have not, according to STORES magazine’s Top 100 Retailers List.

The report, sponsored by SAP and featured in the July issue of STORES, is an annual snapshot of the retail industry and ranks companies by revenue and groups them on one chart regardless of the segment or segments in which they operate.

As the definition of retail continues to expand, technology and entertainment companies were added to the list, with Apple Stores/iTunes (no. 52), Dell Retail (no. 56), Verizon Wireless (no. 61), and AT&T Wireless (no. 81) all making their debut this year.

“With new products, a different ad campaign, or a fresh look, the best retailers are constantly reinventing themselves to remain relevant to their customers,” said Susan Reda, Executive Editor of STORES Magazine. “As consumers struggle with higher gas and food prices, lower home values, and a shaky economy, retailers are staying focused on how to appeal to shoppers during this difficult time.”

As it has since 1991 when STORES began compiling the Top 100 list, Wal-Mart tops the list again for 2007 with sales of $379 billion. According to the STORES article, while Wal-Mart continues to invest in its “green” and organic initiatives, it has not lost site of its original claim to fame of providing everyday low-prices for its customers.

Standing strong near the top of the list, The Home Depot is the nation’s second largest retailer. Home Depot’s rival competitor, Lowe’s, also landed on the list at number nine. Cincinnati-based grocer Kroger came in at no. 4.

Thanks to its acquisition of Caremark, CVS Caremark landed the number three spot on the list, up from number nine in 2006. The health and wellness industry has continued to outperform many other sectors, largely due to consumers cutting back on discretionary purchases and focusing on essentials. Walgreen saw sales increase 13.4 percent from 2006 to $54 billion, securing the number seven position for the Illinois-based drug store.

Costco (no. 5) and Target (no. 6), oftentimes competing for the same customer, maintained their positions within the top 10 with sales of $64 billion and $63 billion, respectively. Costco has consistently landed a top five spot for the last five years.

Rounding out the top 10 are Sears Holdings (no. and SUPERVALU (no. 10), moving Safeway down to number eleven.

STORES Top 100 Retailers:
1 Wal-Mart
2 The Home Depot
3 CVS Caremark
4 Kroger
5 Costco
6 Target
7 Walgreen
8 Sears
9 Lowe’s
10 SUPERVALU

“SAP is proud to sponsor this year’s STORES’ Top 100 list which recognizes that growth and innovation are keys to success in retail,” said Chris Verheuvel, Senior Vice President and General Manager, Retail, SAP America Inc. “Best-run retailers continuously find ways to understand their customers, anticipate their needs, and inspire their loyalty. SAP has a proven track record of helping retailers achieve these goals. In fact, more than 5,800 retailers and wholesalers worldwide are SAP customers.”

National Retail Federation

Source by Fibre2fashion

 

Building a strong and appealing B2B blog

Forrester Research has just released a new report that raises a daunting question: How many B2B companies are benefiting from all various forms of blogging? According to Forrester, about 52.9 percent of companies involved in the B2B segment say that blogging has only a marginal significance or that it is totally irrelevant to their overall marketing efforts.

Among some companies tracked regularly by Forrester, the number of new blogs fell from 36 two years ago to just 3 this year, representing a significant drop by any measure.

Forrester implies the problem may lie with B2B companies themselves, using words like “dull” and “drab” to describe some of the B2B blogs. Among the knocks against blogs noted by Forrester: not enough personality in most of the posts, an irregular posting schedule and bloggers who simply just don’t stick with it.

Overall, 55.8 percent of such B2B blogs feature mostly press releases or other well-known news, giving people little incentive to read them in the first place.

Some marketing observers say that if it’s a B2B blog, shouldn’t it be about business? There’s certainly nothing wrong with inserting an occasional personal anecdote to help illustrate a point or otherwise liven up a business topic, but most people don’t want to read about the hobbies, pets or personal lives of vendors or business partners.

Some have seen business-oriented blogs that read like a particularly painful holiday newsletter, with the added subtext of trying to sell some product or service.

Forrester also presents the lack of comments on most B2B blogs. About 58 percent receive no more than a single comment per post, a sign that the intended audience isn’t being engaged.

There are some that wonder why Forrester mentions “sticking to business” and/or technical topics (something that 70 percent of B2B blogs do) as a negative.

There are some that disagree on that.

Just because people don’t leave comments doesn’t mean they aren’t engaged. They may see little reason to reiterate points already made in a post, and it often just takes too much time to leave more involved comments.

Some may go back later and respond to a thought-provoking post, but it appears that most never do.

Source: Signal vs Noise.

 

Cooling economy makes Chinese exporters hedge their bets

SHANGHAI: Feeling the chill from the US subprime crisis, Chinese exporters such as Zhejiang New Oriental Fastener Company no longer take it for granted that their customers will pay them.

The company, whose 600 staff produce screws, nuts and bolts by the millions, has found that in an age of uncertainty it has to rethink the nuts and bolts of global trade.

“With the subprime crisis, each of our clients has become potentially exposed to unpredictable risks such as bankruptcy,” said Xiang Guihong, sales manager at the company, which focuses on North American and Australian markets.

Xiang said his company used to have “great faith” in its regular overseas customers, but early this year it started to buy credit insurance for all export orders to guard against possible payment defaults.

“As late as last year we felt no need for such a practice. Now we understand that it will help our credit risk management,” Xiang said.

Xiang said the company was particularly affected by the gloomy US property market because its products are widely used in the construction of buildings and infrastructure.

Based in Zhejiang province in eastern China a major export powerhouse the company saw shipments to the United States slump more than 30 pc in the first five months of 2008 from a year earlier.

It is stories like this that help explain why in the first five months of this year, China’s overall trade surplus declined 8.6 pc from the same period a year ago to 78 bn dollars.

This has served as a wake-up call for Xiang, and thousands of other Chinese businessmen, who traditionally have under-emphasised the need for hedging against customer default.

“There is underestimation of the credit risks in Asia in general and in China in particular,” said Jerome Cazes, chief executive of Coface, a Paris-based trade insurer.

Many local firms simply rely on trading records and site visits for credit evaluation. “The subprime crisis is now impacting the real economy, meaning that the B2B (business-to-business) credit crisis kicked in January 2008 and will continue at least for the full year 2008,” he said.

According to Xiang, New Oriental, which had allowed for payment terms as long as 60 days in the past, now requires its US clients to pay for the goods within seven to ten days after delivery.

The pressure is passing upwards through the chain to New Oriental’s domestic suppliers in a ripple effect. “Steel makers and steel trading firms only accept cash for payments,” he said.

Our working capital is so tight that if we had a large amount of account receivables, we’d run out of money needed to buy raw materials for new orders.” This is a situation felt by a large number of Chinese exporting companies, according to Coface.

“Domestic companies exporting to the US are affected by payment incidents in the United States and in turn cannot pay their suppliers in China,” said Richard Burton, the insurer’s regional managing director for Greater China.

Economists in China agreed. “It’s certainly a very real problem,” said Li Yushi, a researcher with a think tank under the Ministry of Commerce.

Li said Chinese companies may need to prepare themselves for a poorer credit environment in domestic trading in the second half of the year if export growth continues to slow.

“For this year, exporters here are really faced with troubles both at home and abroad,” said Guo Mu, a trade official with the official Zhejiang Foreign Trade and Economic Cooperation Bureau.

“We are telling them to make clearer credit investigation on their foreign clients before scrambling for orders. They need to think twice if they feel uncomfortable about potential losses,” he said.