Who is the best supplier the procurement officer

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Reference no: EM133412195

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.

Reference no: EM133412195

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