20 Questions
What are some activities related to supplier development?
Sharing latest technology, providing incentives for improved performance, promoting competition, providing training and development for suppliers’ personnel
What is the objective of supply base optimization?
To determine the optimal number and quality of suppliers in the supply base, often involving eliminating incapable suppliers and adding new ones.
What are some activities involved in supply base optimization?
Development of supplier evaluation and measurement systems, elimination of marginal and small volume suppliers, replacement of good suppliers with better-performing ones, initiation of supplier development projects
What are the advantages of an optimized supply base?
Reduction of supply-base risk, lower supply-base administrative costs, lower total product cost, ability to pursue complex supply management strategies
How does an optimized supply base reduce supply-base risk?
By carefully selecting suppliers, developing collaborative working relationships, reducing variability in performance, and increasing consistency in quality
What is supplier management and development?
Refers to any activity by a buyer to improve a supplier’s performance or capabilities to meet the buyer’s short and long-term needs.
When should a buyer consider removing a supplier from the supply base?
Removing them from the supply base should only be considered if they fail to meet requirements continuously.
What are the advantages of an optimized supply base?
An optimized supply base provides advantages such as reduced costs, improved quality, and increased innovation.
What are the risks of maintaining few suppliers?
The risks of maintaining few suppliers include increased vulnerability to supply chain disruptions and limited access to specialized expertise.
What is the focus of most companies when it comes to developing suppliers' capabilities?
Most companies would rather develop suppliers’ capabilities first before considering their removal from the supply base.
What are the two components of worldwide sourcing?
International Purchasing and Global Sourcing
List three benefits of worldwide sourcing.
Lower cost, access to world-class technology, better quality
Define international purchasing in the context of worldwide sourcing.
Commercial purchase transaction between buyer and supplier in different countries
What is the focus of global sourcing?
Sourcing goods and services from the international market
Name two barriers to worldwide sourcing.
Language barriers, cultural differences
What are the key triggers of worldwide sourcing?
Supply disruption, inflation within home markets, declining domestic supply base, rapidly changing currency exchange rates, sudden emergence of worldwide competitors
List the additional costs components in international purchasing compared to domestic purchasing.
Transportation, duties/tariffs/taxes, insurance premiums, customs broker fees, communication costs, port terminal and handling charges
What are the barriers to worldwide sourcing mentioned in the text?
Lack of knowledge and skills, resistance to change, longer lead times, different business customs, language, and culture, currency fluctuations, increased supply risks
What are the key documentation requirements in international purchasing according to the text?
Letters of Credit, Multiple Bills of Lading, Dock Receipts, Import Licenses, Certificates of Origin, Certificates of Insurance Coverage
What are the two types of Certificates of Origin (CO) mentioned in the text?
Ordinary CO and Preferential CO
Test your knowledge of supplier management, supply base rationalization, and optimization with this quiz based on Chapter 9 of the book 'Sourcing and Supply Chain Management' by Handfield, Monczka, Giunipero, and Paterson. Explore key concepts in supplier development and supply chain optimization.
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