Answer 1. Strategic sourcing is the major tools and technology in supply chain management and it delivers cost reductions and other offers and advantages. It will make strategic sourcing different from a traditional sourcing. This sounds the most strategic supplier relationship that is based on cost and there is an ability to create new business with technological advances. In the past, the organization was usually focused on tactical functions such as processing of purchase orders, checking the status of delivery and this might contribute to corporate responsibility. Various important approaches like engineering driven approaches and selection of supplier processes lead to the number of suppliers at premium prices. It reduces cost of sourcing, helps in achieving low cost. Plexet has a reliable and valued suppliers and Plexet used to maintain long term supplier relationship, especially with large retail chain known as Kiwi Mart.
The purchasing of Kiwi Mart acquired more than 4000 container cases at the discount rate of 4 percent from Plexet. It has decided to benefit with the discounted price rates and selling of high quantity containers. With the selling of 400 container cases at the wholesale price rate, the deal gets negotiated within 3 months. This has helped Kiwi Mart to resolve the challenges such as inventory challenges and other issues with Auckland Kiwi Mart. Just after the negotiation, the head of the Kiwi Mart purchase department had been contacted by Chinex and they offered more than 7 percent discount on more than 5000 container cases of different products such as good seal products. The deal was too strong and good with different orders. The purchasing manager was not aware of the situation and it had a complete line of sizes and quantities with respect to every product. Thus, it has been decided to help and resolve the adjustment of the product line. The purchasing department of Kiwi Mart focused on addressing several issues such as potential inventory crisis and it is securing the amount of supply with the recent acquisition of cheaper products.
Strategic sourcing is the first thing that is combined with the strategic supplier management and there is the effective day to day purchasing with the outcomes of supply chain management. The organization is able to create and develop new advantages with better and effective roles as well as relationship. It chooses the innovation and leads to the marketplace with strategic efforts on sourcing. This way, the purchase department of Kiwi Mart will be able to develop strong goals and objectives with respect to communication and suppliers would be able to promote interaction with high opportunities and well defined communication to complete the things in a right manner. This way, they can build strong competitive advantage and opportunity to reduce challenges and complexities and to standardize the possible supply chain strategies.
Therefore the purchasing department will be able to reduce the cost to more efficient and effective process and it will be able to deliver better process. Answer 2. There should have successful partnership with long term commitment and it encourages in investing improvements in supply chain to mutual advantages. Thus, it will build and improve long term commitment with the form of collaborative framework partnership with the involvement of business to business relationship and it will meet the expectations in terms of goals and objectives.
Answer 3. Plexet will adopt the just in time approach to production to improve the business with reduction on in-process inventory and carrying cost. It will focus on continuous improvement and it will help to achieve employee involvement and high quality. Answer 4. The implementation of inventory system in Kiwi Mart and Plexet will help to organize the distribution software and it will create a cohesive inventory for organization system. It will maintain the balance and inventory with the track of sales of the product and inventory.