The general modern conception regarding procurement is recognizing the importance that, in addition to price, other elements may have in this relation. A This will help Rick in another way as he will be able to solve the problem of stock out, specially for the basic raw material ie Aluminum.
Suppliers will also have a strong incentive to cooperate with the company as they can obtain higher revenues due to more bulk orders. Re-buying will also be of utmost importance now in order to ensure that there is always sufficient inventory to maintain production going.
Main Objectives of the New Business Strategy 1. Inventory turns from present 4 times to 20 times. Korean firms have a low cost base and compete primarily on low cost. Moreover, reducing the purchasing price on raw materials will produce a leverage effect on the return on assets.
Moreover, reducing the purchasing price on raw materials will produce a leverage effect on the return on assets. Spartan should keep always in mind that many of their customers including some of the key ones decided to opt for standard product design because it brings them more advantages like lower cost and faster delivery.
A vendor base of can prove very beneficial for Spartan. The new strategy will affect the corporate structure of the company. This means that any given reduction that Spartan can obtain on the procurement price of aluminium will translate in an even higher increase in the return on assets.
In consequence, Spartan should look for new suppliers that satisfy effectively the new needs of that the market is asking for.
This structure was functional to the previous strategy because there was a strong focus on the purchasing function.
Raw materials procurement The customization strategy required the presence of many vendors and a high level of inventory in the warehouse. Actions to be Taken 2 I. We believe that in order to maximize the SC Department resources in accordance with the new structure the positions and functions of the people with the SC Department will have to be adapted to strengthen the inventory management function of the company.
This will also provide Rick more negotiation power for a ixed vendor base, for his basic raw material as explained later on. Actions To Be Taken 4.Supply Strategy Case Spartan Heat Exchangers Inc. Case Sabor Inc. Case Ford Motor Company: Aligned Business Framework 3.
Supply Organization Case Iowa Elevators Case Roger Haskett 4.
Spartan Heat Exchangers Inc. Overview Leader in design and manufacturing of industrial heat transfer equipment Shift in consumer demand Old business strategy. Supply Strategy Case Spartan Heat Exchangers Inc.
Case Sabor Inc. Case Ford Motor Company: Aligned Business Framework 3. Supply Organization Case Iowa Elevators Case Roger Haskett 4. Supply Processes and Technology Case Bright Technology International Case Hemingway College Case Portland Bus Company 5.
Spartan Heat Exchanger Inc Essay Sample Spartan, who was a leading designer and manufacturer of specialized industrial heat transfer equipment earns sales revenues of $25M. The company has prided themselves on creating a Make-to-Order system that allows customers the option of customizing their orders to their needs.
Spartan Heat Exchangers, Inc. is facing increased competition from Korean and European Companies.
Korean Companies, with its low cost base competed primarily on price while the European Firms focused on standardizing their product lines to a few high-volume products and. Current State Spartan Heat Exchangers Inc. is a leading designer and manufacturer of specialized industrial heat transfer equipment for more than 10 years.
The company’s primary products are transformer coolers, hydro generator coolers, air-cooled heat exchangers and transformer oil coolers.Download