Introduction
Nationwide telephone has been in the business of manufacturing low-cost and high-quality telephones from 2001. The company is reliant on local suppliers in order to minimize lead times and at the same time utilizing the number of suppliers. This facilitates faster delivery times and also decreasing the travel costs. In the past 6 months, Roger Stoga who is the president of the company has seen a decline in sales of the company. Subsequent to further analysis, he was able to determine the issue to be linked to a rise in the prices of plastic components, supplied by ABC Plastics. The main aim of this analysis is to ascertain why the price of the components has increased.
1. What analytical tools can be used by the supply group to determine the right price?
There are different analytical tools that can be employed by the supply group to make a determination of the right price. One of the tools is environmental scanning. Through this method, the supply group can be able to determine the price being charged by rivals in the market and therefore determine the suitable price to charge. Another analytical tool is cost-price technique. In this way, the supply group is able to determine the fitting price by knowing the costs incurred and placing a mark-up in order to attain the sought-after profit.
2. How could Nationwide’s supply department have prevented...
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