Chap012 - Chapter 12 - Supplier Selection CHAPTER 12...

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Chapter 12 - Supplier Selection C HAPTER 12 Supplier Selection Topics Covered The Supplier Selection Decision Decision Trees Identifying Potential Sources Information Sources Standard Information Requests The Request for Information (RFI) The Request for Quotation (RFQ) or Request for Bid (RFB) or Invitation to Bid or Tender The Request for Proposal (RFP) Additional Supplier Selection Decisions Single versus Multiple Sourcing Manufacturer versus Distributor Geographical Location of Sources Supplier Size Supplier Development/Reverse Marketing Evaluating Potential Sources Level 1 – Strategic Linking Sourcing with Strategy Risk Assessment Strategy Development Level 2 – Traditional Technical, Engineering, Manufacturing and Logistics Strengths Management and Financial Evaluation Level 3 – Current Additional Financial Considerations Environmental Impact Innovation Regulatory Compliance Social and Political Factors Ranking Potential Suppliers Conclusion Questions for Review and Discussion References Cases Loren Inc. Russel Wisselink Kettering Industries Inc. 12-1
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Chapter 12 - Supplier Selection QUIZ RESPONSES D 1. Small suppliers: a. are most suited for large dollar value “A” requirements. b. usually represent very low risk to the purchaser. c. tend to have a strong financial base. d. often provide the greatest responsiveness and flexibility. e. tend to have an extensive management structure. A 2. Reverse marketing is: a. encouraged by the rapid rate of technological change, growth in international trade, and the need to extract competitive advantage from supply chains. b. when the buying organization has decided to stop making something inhouse and identifies a supplier from its existing supply base. c. is an aggressive, marketing-initiated, approach to finding and developing world class suppliers. d. requires that the marketing department in the buyer’s organization fully understand the needs of supply. a. is most appropriate when the product is fairly standard and available from multiple local suppliers.
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Chapter 12 - Supplier Selection C 3. Decision trees: a. may be useful in making effective supplier selection decisions the first-time a buying decision is made, but not on repetitive purchases. b. may be useful in making effective supplier selection decisions when making repetitive purchases, but not special, one-time purchases. c. may be useful in making effective supplier selection decisions if probabilities of success and failure are assessed for each option. d. are of limited value because options can only be evaluated qualitatively, not quantitatively. e. cannot reflect past decisions so they are useless as a decision tool when making repetitive purchases. D
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Chap012 - Chapter 12 - Supplier Selection CHAPTER 12...

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