# 10 Supply Chain

Question 1

Just-in-time manufacturing

Answer 1

A supply chain strategy based on a pull-based inventory flow system. Inspired by Toyota production system. Manufacturing is able to quickly adapt to customer demand

Often having sell-out and inventory reporting and sales forecasts from customers.

In international context, often moving suppliers close to production

Advantages:

• Reduces inventory holding costs
• Quick detection of quality problems

Question 2

Risks and vulnerabilities of international supply chains and just-in-time

Answer 2

• International supply chains are subject to a variety of risk and vulnerabilities, including but not limited to natural disasters, such as the Tsunami hitting Japan
• Time and occurrence of such uncertainty factors cannot be determined ex ante.
• To limit damage from such disruptions, some companies have adopted the “just-in-case” buffer system.

Question 3

Factors influencing manufacturing location choice

Answer 3

Country factors: Resource availability, costs, infrastructure

Product factors: value-to-weight, required production technology

Government policies: stability

Organizational issues: strategy