Read the case study below and answer the questions that follow. Supply chain strain: China’s COVID lockdowns impact Toyota, Samsung, Volkswagen, and Nike Well-known brands have been impacted by China’s COVID-19 response which has caused the closure of factories, ongoing disruptions at ports, and workforce shortages. China’s zero-tolerance strategy for combating the pandemic is resulting in continued disruptions for supply chains. Companies such as Samsung Electronics, Volkswagen, Nike, and Adidas are suffering production issues already. It comes as Chinese officials impose citywide lockdowns and unprecedented mass testing requirements ahead of the 2022 Winter Olympics in February. Samsung Electronics has also reported difficulties getting employees to work after restrictions were introduced making it difficult for residents to leave home. The company has warned of a small decline in production output in the short term. Global sports brands Nike, Adidas, and Fast Retailing Co’s Uniqlo also faced interruptions after supplier Shenzhou International Group said some factories had been locked down. Production sites in Ningbo’s Beilun district were impacted from January 3 after 10 COVID-19 cases were detected in the area. While China has continued to follow the same rules which successfully curbed other outbreaks, experts have concerns that these measures will not work against the contagious Omicron variant. “The risk posed by the Omicron variant is that we could take a huge step back in terms of supply- chain bottlenecks,” co-head of Asian Economics Research at HSBC Frederic Neumann said. “This time, the situation could be even more challenging than last year given China’s increasingly significant role in global supply,” he added. The possibility of a nationwide lockdown in China has caused some economists to cut the nation’s economic growth forecasts. Q.2.1Outline any two characteristics of outsourcing in relation to Samsung. Q.2.2.1 In your own words, discuss the concept of bottleneck items. Q.2.2.2Based on your understanding of bottleneck items, would you say that a purchase of a sanitizer machine for staff for Samsung’s headquarters is an example of bottleneck purchases? Justify your stance by discussing at least two key points. Q.2.3Due to Covid-19 restrictions in China, the South Korean branch of Samsung is looking to rely on suppliers from other countries, such as Japan, South Africa, and China. With examples related to Samsung, explain any four disadvantages associated with using international suppliers.
Read the case study below and answer the questions that follow.
Supply chain strain: China’s COVID lockdowns impact Toyota, Samsung, Volkswagen, and Nike
Well-known brands have been impacted by China’s COVID-19 response which has caused the closure of factories, ongoing disruptions at ports, and workforce shortages. China’s zero-tolerance strategy for combating the pandemic is resulting in continued disruptions for supply chains. Companies such as Samsung Electronics, Volkswagen, Nike, and Adidas are suffering production issues already. It comes as Chinese officials impose citywide lockdowns and unprecedented mass testing requirements ahead of the 2022 Winter Olympics in February.
Samsung Electronics has also reported difficulties getting employees to work after restrictions were introduced making it difficult for residents to leave home. The company has warned of a small decline in production output in the short term. Global sports brands Nike, Adidas, and Fast Retailing Co’s Uniqlo also faced interruptions after supplier Shenzhou International Group said some factories had been locked down.
Production sites in Ningbo’s Beilun district were impacted from January 3 after 10 COVID-19 cases were detected in the area. While China has continued to follow the same rules which successfully curbed other outbreaks, experts have concerns that these measures will not work against the contagious Omicron variant.
“The risk posed by the Omicron variant is that we could take a huge step back in terms of supply- chain bottlenecks,” co-head of Asian Economics Research at HSBC Frederic Neumann said.
“This time, the situation could be even more challenging than last year given China’s increasingly significant role in global supply,” he added. The possibility of a nationwide lockdown in China has caused some economists to cut the nation’s
Q.2.1Outline any two characteristics of outsourcing in relation to Samsung.
Q.2.2.1 In your own words, discuss the concept of bottleneck items.
Q.2.2.2Based on your understanding of bottleneck items, would you say that a purchase of a sanitizer machine for staff for Samsung’s headquarters is an example of bottleneck purchases? Justify your stance by discussing at least two key points.
Q.2.3Due to Covid-19 restrictions in China, the South Korean branch of Samsung is looking to rely on suppliers from other countries, such as Japan, South Africa, and China.
With examples related to Samsung, explain any four disadvantages associated with using international suppliers.
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