What type of contract would you use

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Reference no: EM133446605

Case: This simulation involves negotiating the purchase of an automotive fabric. The following information is common to all groups participating in the negotiation: There are four potential manufacturers of textile products. These include the following: Athena Corp. - Annual sales of approx. $ 40 million dollars, located in Bowling Green, Kentucky.. Cybaris Corp. - Annual sales of approx. $ 50 million dollars, located in Charlotte, NC. Medusa Corp. - Annual sales of approx. $ 20 million dollars, located in Columbus, OH. Orion Corp. - Annual sales of approx. $ 35 million dollars, located in Grand Rapids, MI.

Prices for similar fabrics are in the $12.00 to $15.50 price range per yard. All identified suppliers are able to produce to specifications provided by the purchasing company. However, quality performance related to the product can vary greatly. Individual cost structures of the firms providing the fabrics can vary significantly. Suppliers provide widely different levels of service and technical support. All suppliers have to satisfy the same quality and delivery terms, payment terms, and transportation (FOB seller's plant). Industry capacity utilization is about 75 percent. All purchasing companies have purchased relatively small amounts from all of the suppliers previously, never totaling more than $100,000 per purchase.

Question:

If you represents a buyer, consider the different suppliers - which one would you select? What type of contract would you use?

Reference no: EM133446605

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