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Plastic Cable Clips Case Study

Essay by   •  October 23, 2018  •  Case Study  •  752 Words (4 Pages)  •  1,988 Views

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Assignment #5

Case #12-3 Plastic Cable Clips

Fisher & Paykel

  • Largest Manufacturer of Home Appliances
  • Location: Auckland, New Zeland
  • 8 operating Divisions
  • Major Appliances: $135000000
  • Total Sales: $ 270000000
  • $36000000 – export sales & royalty income
  • Laundry Division  500 employees

New line of Automatic Washing Machines

  • Key Priority- Maintaining Least cost
  • Hope to Produce- 75000 to 100000 new machines
  • 6 types of ties (total 45) plastic clips to be used in each machine comparing to 20 diff. ties (total 250 ties) in the old washing machine
  • Suppliers to be decided
  • Quotations invited

Total Purchases from multiple suppliers for the old machine - $ 1250000

  • $500000 Olson Plastics
  • $500000 Barry Cleaver
  • $200000 GT Rollman
  • $50000 Plastic Distribution

Oslon

  • $ 500000 order
  • Local Manufacturer
  • Supplier for many years
  • Quality not as high
  • Service problems
  • Prices twice as high
  • Delivery - major concern, unreliable
  • Lead time- 6-8 months
  • Capacity Issues
  • Government Protection

Barry Cleaver & Sons

  • $ 500000 order
  • Excellent reputation
  • Barry Clever - advisor
  • Importing from Japan
  • Prices – excellent
  • Service - excellent
  • Delivery - good
  • Lead time - 6-8 months
  • Licence could be revoked- past issues
  • Technical expertise

GT Rollman

  • Agent Importing from Australia
  • Excellent Services
  • High prices
  • Good Delivery
  • In bad times: 3-4 months
  • Urgent Times- 6 weeks
  • Possible Duty Free Access to Australian market
  • Australia had strong relations

Plastic Distributing

  • Small Young Company
  • Fulfilled orders in tight times
  • No technical expertise
  • Eager to acquire orders

Selection Criteria

  • Location - New Zealand or Australia preferable
  • Lead Time
  • Services
  • Costs Involved - Procurement & Storage

Advantage/Disadvantage

Olson - Advantage

  • Old Supplier
  • Protection from Government

Olson – Issues

  • Cost
  • Delivery
  • Service
  • Quality
  • Insufficient capacity

Barry Cleaver – Advantage

  • Reduced Lead time
  • Excellent service
  • Technical Expertise

Barry Cleaver – Issues

  • Revoking of permission

GT Rollman – Advantage

  • Excellent Service
  • Fast Delivery
  • Urgent Delivery
  • Reduced Storage costs
  • Duty Costs minimum
  • Australia Preferable choice

GT Rollman – Issues

  • Very high cost

Plastic Distribution – Advantage

  • Gave order in tight times
  • Eager for orders & performing

 Plastic Distribution – Issues

  • New
  • Small
  • no Technical Expertise

Cost Analysis

G.T.Rollman

[pic 1]

  • Insufficient quote
  • Expensive

Course of action:

  • Inquire about pricing
  • Negotiate better prices

Barry Cleaver & Sons

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