Purchasing and Supply Chain Management
Purchasing and Supply Chain Management
6th Edition
ISBN: 9781285869681
Author: Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Publisher: Cengage Learning
Question
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Chapter 6, Problem 1DQ
Summary Introduction

To select: A category and analyze how the category is strategic to an industry.

Category strategy development:

A category is a specific family of products or services that are utilized in delivering the appropriate value to the customer. A strategy is developed to deliver the category products or services in the supply chain management process. It is known as category strategy development.

Expert Solution & Answer
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Explanation of Solution

Categorizing and analyzing how the category is strategic to an industry:

Oil versus gasoline:

The analysis made by EIA indicated that crude oil price is the main contributor to the change in gasoline prices in Country U. The prices of crude oil are greatly affected based on the level of supply relative to the demand for oil and petroleum products that are made from crude oil.

Strong worldwide demand and growth for petroleum products in the mid-period of the 2000s were the major reasons for the high crude oil prices in the mid of the year 2008. The seasonal change from summer gasoline to winter gasoline with lower cost combines along with reduced gasoline demand. It also contributed to the general reduction in prices from October to December 2011.

Oil prices have fluctuated widely since then mainly due to the concerns of petroleum supply worldwide and the economic conditions all over the world.

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