David LumSCM 406W4/13/08Chapter 83. Suppliers have more than an equal weight on quality of a product. This is because the purchasing firm that makes the product spends 55% of their money on acquiring the components for their product. Since more and more companies are using suppliers to make their finish goods or assembly parts of the product. So it means the purchasers are becoming more reliant on the supplier’s quality, and the suppliers are becoming more involved in manufacturing. That is why they are just as responsible for the quality as the purchaser, who should be checking for errors. One supplier may have a greater impact on a purchasing firm then other supplier if one part is more essential for the purchaser’s product than another supplier’s part. This is especially the case if the part is inelastic, or the company can’t function without it, which can have huge consequences.4. Purchasers communicating with suppliers about product development can improve quality greatly. This is because the supplier can expect what they should make and aren’t rushed to do
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Malcolm Baldrige National Quality Award, Production and manufacturing