THE PRICE EQUIVALENT COMPANY (PEC) Introduction a The Price Equivalent Company (PEC) is a medium-sized enterprise in the

[answerhappygod]

The Price Equivalent Company Pec Introduction A The Price Equivalent Company Pec Is A Medium Sized Enterprise In The 1 (118.91 KiB) Viewed 79 times

THE PRICE EQUIVALENT COMPANY (PEC) Introduction a The Price Equivalent Company (PEC) is a medium-sized enterprise in the private sector. PEC manufactures and sells a range of protective work-wear and equipment which is designed to withstand the most hazardous working conditions. The products are made to extremely high quality standards and PEC constantly updates its products to reflect different operating environments and health and safety at work requirements. New product development is often focused primarily on technical excellence rather than profitability Procurement Activities The current buyer at PEC has been in the position for six months having been promoted from purchasing assistant when the previous buyer retired. Due to her limited experience combined with the complexity of the product range and the need for high levells of quality, she has found it difficult to influence sourcing strategy Formal procurement procedures and systems at PEC are very limited. Currently, the buyer waits to receive a requisition from the production function to place orders for equipment materials and products. This means that orders are usually urgent and the buyer has little opportunity to review alternative suppliers or sourcing approaches Low value maintenance, repair and operations (MRO) requirements cause particular problems as the requisitions are difficult to aggregate. This causes excessive and time-consuming administration for the buyer
Testing requirements Pressure testing machinery used for testing the quality of seams in the protective work-wear is nearing the end of its life and will soon require replacement. Product testing is essential to confirm final quality of manufacture and conformance to industry standards The test equipment is highly specialized and will be costly to replace. Also, recent machine maintenance highlighted both the cost and the long lead times of the MRO items required to keep the machine operational. If the equipment is not replaced the test work will need to be outsourced to a facility specializing in this type of service provision Supplier data Recently, the buyer has become concerned that some of her key suppliers could be facing financial difficulties. However, she is uncertain how to investigate the financial position of these suppliers. The information left by the previous buyer is several years out of date and the current buyer is concerned that their position could now be significantly worse. The buyer believes that she needs to research the supply market in order to gather more information on external supplier capabilities. This will allow her to identify alternative suppliers with the necessary technical and quality standards and good financial stability
Requirements 1. Examine THREE (3) different sourcing approaches that could be used by the buyer at PEC to more effectively source safety products and materials from suppliers. (AP: 9 MARKS) 2. Outline the circumstances that will warrant a firm to consider outsourcing (AP: 8 MARKS) 3. Discuss the actions that the buyer could take to balance commercial and technical award criteria when selecting suppliers. (AP: 8 MARKS) 4. Identify FIVE (5) signs that the buyer at PEC could look for to indicate that certain suppliers are experiencing financial difficulties. (AP: 10 MARKS) 1 5. Explain THREE approaches that the buyer at PEC could take to obtain reliable information about these suppliers financial positions. (AP: 6 MARKS) 6. Currently, the buyer waits to receive a requisition from the production function to place orders for equipment, materials and products. This means that orders are usually urgent and the buyer has little opportunity to review alternative suppliers or sourcing approaches." From the statement above, discuss what the buyer could consider as the company's strength, weakness, opportunities and threats for the acquisition of equipments, materials and products.
7. From the above statement, discuss the dangers involved in having little opportunity to review alternative suppliers or sourcing approaches. (AP: 10 MARKS) 8. PEC relies on global sourcing for its supplies. Suggest any three (3) payment methods in global transactions and discuss three (3) factors that influence the choice of a payment method. (AP: 6 MARKS) 9. It is not clear from the case whether or not PEC employed e-procurement. a) Comment on the need for e-procurement. b) Suggest three (3) e-procurement tools or platforms that PEC can employ (AP: 8 MARKS) 10. Some are of the view that the adoption of e-procurement has eased up the procurement functions, thus establishing a centralized procurement department within organizations has lost its relevance since each department within the organization can adopt e-procurement tools for its supplies. Discuss. (AP: 5 MARKS)