What are advantages of basing a suppliers overall evaluation

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Reference no: EM13756060

1. What are the advantages of basing a supplier's overall evaluation on its lowestperformance on one of the five dimensions (Quality, Delivery, Cost Management,Technical Support and Wavelength)? What are the disadvantages? Overall, do youthink that basing a supplier's overall evaluation on its lowest performance on onedimension is a good idea or not? Why or why not?

2. Develop importance weights for the five supplier rating dimensions shown inTable 1. Should these weights be equal? Briefly explain the basis for these weights.

Table 1 Supplier Evaluations

Dimension New England Watts Midwest Beatings

Quality Partner Partner

Delivery Partner Approved

Cost Management Key Partner

Technical Support Partner Approved

Wavelength Partner Key

Overall Key Approved

3. Develop a weighted-point system for evaluating Agri& Lawn Company bearingssuppliers. Please keep in mind that (a) the sum of these five weighted dimensionsmust add to 100 points, and (b) Agri& Lawn Company has the current goals ofdeveloping long-term relationships with suppliers and generating cost reductions.

4. Make a case for paying a price premium that favors a higher overall rated supplier,such as New England Works. Make a case for not granting a price premium for ahigher-rated supplier. Which would you recommend? Why?

5. Assume that Agri& Lawn Company is considering paying a price premium to themore highly rated supplier (New England Works) in this year's buy of part#B02326620. If the only two suppliers quoting on this part are New England Worksand Midwest Bearings, what percentage premium (over the lower price) would yourecommend? Justify your response.

6. Should Agri& Lawn Company single source with New England or with Midwest? Orshould they divide the business between the two? Briefly explain your rationale.

7. Assume that Agri& Lawn Company has decided to divide the purchase of part#02326620 between New England Works and Midwest Bearings. What percentagewould you recommend be bought from each? Briefly explain your rationale.

8. Agri& Lawn Company (a) places a high priority on developing long-term relationshipswith suppliers that meet its goals and (b) pursues an aggressive program ofannual cost reduction. If you were Mr. Walsh, what guidance would you give toOlivia regarding how these goals should be treated? Briefly explain your rationale forthe guidance you gave.

Reference no: EM13756060

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