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Small Supplier: Big Volume - Research Paper Example

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This research paper is about two companies in which Success Inc is the customer of ABC GmbH, which is a supplier. This case focuses the challenges and issues which Success Inc faces while dealing with its supplier, ABC GmbH. Many companies go for unethical and illegal practices…
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Small Supplier: Big Volume
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"Small Supplier: Big Volume"

Download file to see previous pages Success Inc. is facing serious troubles with one of its supplier namely ABC GmbH. Success Inc is a newly established company and has been looking for supplier for the manufacturing of the components if its two products, X and Y. As soon as the deal is finalized and the commencement of the proceedings happens, Success Inc realizes that for the manufacturing of its Product Y, ABC GmbH requires a substantial amount of investment. It was known to Success Inc that the investment would be required but the miscalculations done by ABC GmbH were beyond the consideration of Success Inc. ABC GmbH stated that the investment would require $10 million just to trap and confine Success Inc. However, the original figures were not revealed at the time of discussing and finalizing the deal. Statement of Objectives  Success Inc should have pondered upon the financial position of ABC GmbH. It is not possible to determine whether the company is treating fairly or not, but before settling any deal, all the documentation, requirements and other essential conditions should be stated. ABC GmbH had placed Success Inc in a much critical condition by misleading them through inaccurate and deceiving computation done intentionally. Areas of Consideration In this section, the integral areas of consideration are stated which include strengths, weaknesses, threats and opportunities of Success Inc. Strengths Success Inc has strength that its top management has good relations with its suppliers. If the situation doesn’t get settled, then the top management can come up at frontline to manage this issue. Determined and honest staff of Success Inc is it’s another major strength. Despite of the strong relations of top management with its suppliers, its employees, Jack and Jill are at frontline and are handling this critical condition with huge determination. Weaknesses Success Inc is a newly established company therefore it should have analyzed and thoroughly checked the financial position and stability before finalizing any deal with its supplier. This negligibility can cause loss of huge time and money and can also result in frustration. Another weakness of Success Inc is that it should not let go any good deal just because of its ill-mannered staff. Tolerating the worst attitude of staff members can be much better than losing substantial amount of time and money. Threat Success Inc has a huge threat of bargaining power of supplier. Due to their negligibility, their supplier, ABC GmbH can alter the decisions of Success Inc in their own favour which can cause huge loss of money to Success Inc. Opportunities This mistake gives a lesson of being more cautious in future. There are number of supplier present in the industry and Success Inc has the opportunity to specify their own requirements before settling deal with any new supplier. Time Context As far as the time frame is concerned, it is quite favorable for Success Inc because after analyzing the case study, it became evident that Success Inc does not have any time pressure to launch a particular product in a particular time. It can be an edge to Success Inc as in the meantime it can switch to another supplier and can save the additional time which would be incurred in dealing with ABC GmbH.   ...Download file to see next pagesRead More
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