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Case Study 2
Case Study 2
needed the supply. This has helped the other KMs throughout the country, as well as
solved any inventory issues with the Auckland KM. The plan is for the Auckland KM to
discount 1000 cases for a special in-store promotion.
Soon after the deal with Plexet had been negotiated, Chinex contacted the head of
KMs purchasing department. They offered a significant 7 percent discount on 5000
cases of assorted Goodseal products. The deal was far too good to be ignored and KM
accepted the deal. The sales department contacted Plexet and cancelled their next
three orders. KM received the Chinex products over a month late.
Unfortunately, the purchasing manager was unaware of the situation on the ground in
the local KM. The shelves holding the Goodseal line had an ample supply of the 1L six
packs, but no other size was on the shelf. Worse yet, Plexets competitors were stocked
next to the Goodseal line, and had a full line of product sizes and quantities per pack.
Whats the problem?
Plexet is under the assumption that they have a sales crisis. Forecasted demands are
higher than their current rate of sales. They have decided to help resolve this by
adjusting their product line, and adapting their production line to manufacture more
products that sell faster. Offering coupons would help boost sales and consumer loyalty.
The purchasing department at KM believes they have addressed a potential inventory
crisis, are secure in the amount of supply they have acquired, and have perhaps even
boosted their bottom line through the recent acquisition of the cheaper Goodseal
product from Chinex.
Case Study Discussion Questions
1. Explain how conducting an organized and systematic sourcing process would
benefit the purchasing department at KiwiMart (KM).
2. What form of partnership would help improve both KM and Plexets supply
chains? Why?
3. How would Plexet benefit from adopting a JIT (Just in Time) approach to
production?
4. Explain the advantages KM and Plexet would receive from implementing an
inventory management system.
Using material from the text and in-class discussions, provide clear and concise
answers that include some (4+/-) important and/or supporting points (for EACH
question) that have been developed by your group. A Microsoft word document
is to be submitted via the elearn DROPBOX by 9pm Wednesday August 5 th, 2015.
A printed hard copy is to be delivered in-class on Thursday August 6 th at 10am.
Each group member should be prepared to answer 1 or more questions regarding
the assignment in the final class.