Solution-Procurement officer can go with based on total cost

Procurement officer can go with based on total cost

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Reference no: EM133408287

A procurement officer for a particular type of Screws used in the production of fans must decide among three sources. Source A will sell the Screws for $2.50 per unit, independently of the number of wafers ordered. Source B will sell the wafer for $2.40 each but not consider an order for fewer than 3,000 units, and Source C will sell the wafer for $2.30 each but will not accept an order for fewer than 4,000 Screws. Assume an order ordering cost of $100 for each order and an annual requirement of 20,000 Screws. Assume a 20 percent for holding cost calculations.

Who is the best supplier the procurement officer can go with based on the total cost? Explain your Source selection through calculation.

Hint( Consider All unit Discount Model)

Reference no: EM133408287

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Procurement officer can go with based on total cost

Reference no: EM133408287

Reference no: EM133408287

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