Concept explainers
a)
To determine: The number of shirts to be sold at breakeven with package 1.
Introduction:
The way in which the production of a product takes place or a service is provided to the consumers is known as process planning. It helps in determining from where the components of production will be arranged. The process planning also helps in documentation and development of specification for manufacturing and delivery purpose.
b)
To determine: The breakeven point for packages 1 and 2 with an $8 price.
Introduction:
The way in which the production of a product takes place or a service is provided to the consumers is known as process planning. It helps in determining from where the components of production will be arranged. The process planning also helps in documentation and development of specification for manufacturing and delivery purpose.
c)
To determine: The logo package that should be recommend if person P expects to sell 75 shirts and 200 shirts.
Introduction:
The way in which the production of a product takes place or a service is provided to the consumers is known as process planning. It helps in determining from where the components of production will be arranged. The process planning also helps in documentation and development of specification for manufacturing and delivery purpose.
d)
To determine: The decision rule for person P to use based on anticipated sales volume.
Introduction:
The way in which the production of a product takes place or a service is provided to the consumers is known as process planning. It helps in determining from where the components of production will be arranged. The process planning also helps in documentation and development of specification for manufacturing and delivery purpose.
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Operations and Supply Chain Management 9th edition
- Scenario 3 Ben Gibson, the purchasing manager at Coastal Products, was reviewing purchasing expenditures for packaging materials with Jeff Joyner. Ben was particularly disturbed about the amount spent on corrugated boxes purchased from Southeastern Corrugated. Ben said, I dont like the salesman from that company. He comes around here acting like he owns the place. He loves to tell us about his fancy car, house, and vacations. It seems to me he must be making too much money off of us! Jeff responded that he heard Southeastern Corrugated was going to ask for a price increase to cover the rising costs of raw material paper stock. Jeff further stated that Southeastern would probably ask for more than what was justified simply from rising paper stock costs. After the meeting, Ben decided he had heard enough. After all, he prided himself on being a results-oriented manager. There was no way he was going to allow that salesman to keep taking advantage of Coastal Products. Ben called Jeff and told him it was time to rebid the corrugated contract before Southeastern came in with a price increase request. Who did Jeff know that might be interested in the business? Jeff replied he had several companies in mind to include in the bidding process. These companies would surely come in at a lower price, partly because they used lower-grade boxes that would probably work well enough in Coastal Products process. Jeff also explained that these suppliers were not serious contenders for the business. Their purpose was to create competition with the bids. Ben told Jeff to make sure that Southeastern was well aware that these new suppliers were bidding on the contract. He also said to make sure the suppliers knew that price was going to be the determining factor in this quote, because he considered corrugated boxes to be a standard industry item. Is Ben Gibson acting legally? Is he acting ethically? Why or why not?arrow_forwardScenario 3 Ben Gibson, the purchasing manager at Coastal Products, was reviewing purchasing expenditures for packaging materials with Jeff Joyner. Ben was particularly disturbed about the amount spent on corrugated boxes purchased from Southeastern Corrugated. Ben said, I dont like the salesman from that company. He comes around here acting like he owns the place. He loves to tell us about his fancy car, house, and vacations. It seems to me he must be making too much money off of us! Jeff responded that he heard Southeastern Corrugated was going to ask for a price increase to cover the rising costs of raw material paper stock. Jeff further stated that Southeastern would probably ask for more than what was justified simply from rising paper stock costs. After the meeting, Ben decided he had heard enough. After all, he prided himself on being a results-oriented manager. There was no way he was going to allow that salesman to keep taking advantage of Coastal Products. Ben called Jeff and told him it was time to rebid the corrugated contract before Southeastern came in with a price increase request. Who did Jeff know that might be interested in the business? Jeff replied he had several companies in mind to include in the bidding process. These companies would surely come in at a lower price, partly because they used lower-grade boxes that would probably work well enough in Coastal Products process. Jeff also explained that these suppliers were not serious contenders for the business. Their purpose was to create competition with the bids. Ben told Jeff to make sure that Southeastern was well aware that these new suppliers were bidding on the contract. He also said to make sure the suppliers knew that price was going to be the determining factor in this quote, because he considered corrugated boxes to be a standard industry item. As the Marketing Manager for Southeastern Corrugated, what would you do upon receiving the request for quotation from Coastal Products?arrow_forwardGreat American Inc. (GA), a California based construction company, has been buying wooden floor plate from Davidson Supply (DS) for the last 3 years. Mr. Gordon Shuttle, the GA Purchasing Director, so far, is satisfied with DS services, including product quality and on-time delivery services. Due to the keen competition in the industry in recent year, GA management decided to review DS’s overall supply performance.a) What kinds of challenges that GA should consider? b) If GA decides not to use DS’s supply in future, what will be GA’s otheroptions? c) What kinds of risks GA may face if taking such options?arrow_forward
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