GMS 401 Lecture Notes - Lecture 9: Cross-Docking, Capacity Utilization, Disintermediation

• School: Ryerson University
• Department: Global Management Studies
• Course: GMS 401
• Professor: Wally Whistance- Smith

Document Summary

In order to produce end good for the consumer, we are reliant on the dedication that our suppliers put into supplying our product. (cid:449)e (cid:449)o(cid:374)"t (cid:271)e happy (cid:271)e(cid:272)ause (cid:449)e (cid:373)ay (cid:374)ot (cid:271)e a(cid:271)le to produ(cid:272)e produ(cid:272)ts for our customers on time. And there is a common practice of giving discount if we are late (up to 10% of the invoice as penalty) (cid:373)ay(cid:271)e result i(cid:374) a loss. Upplier (cid:449)o(cid:374)"t (cid:271)e a(cid:271)le to (cid:272)o(cid:448)er this, he/she (cid:373)ay (cid:271)e upset that (cid:449)e (cid:449)o(cid:374)"t (cid:271)uy fro(cid:373) the(cid:373) agai(cid:374). As you spread the demand for inventory across (cid:373)ultiple supplier, that look at you like you are (cid:374)ot loyal to us so (cid:449)e (cid:449)o(cid:374)"t (cid:271)e loyal to you and that can create problems. The larger the supply pool, the weaker the relationship accelerate the potential for problems. Fewer suppliers is not without problem as well. Theory that suggests if you pay your suppliers well, they will be motivated to supply you.