Problem Set 6

Question 1

What is the purpose of single sourcing? How can single sourcing help firms meet their quality objectives?

Answer 1

Single sourcing refers to the use of a single supplier for a specific item. The advantage of this is that the relationship between the two companies becomes highly important to both parties.

Question 2

What is the supply value chain? How does the supply value chain help organizations
manage their supply chains?

Answer 2

The supply chain is the set of all activities that the company performs and how they
interact with each other. The value chain breaks down the activities of the company
into its component parts in order to identify and reduce internal competition.

Question 3

While freight rates are often based on very complicated pricing systems, in general, the
primary freight price factor is based on which of the following attributes?

Answer 3

speed of shipment

Question 4

Warehouses sometimes perform certain other functions besides storing goods. Which of the following is NOT typically one of those functions?

Answer 4

purchasing

Question 5

Designing distribution networks to meet customer expectations suggests what three
criteria?

Answer 5

rapid response, product choice, and service

Question 6

What three logistics-related costs are relevant when analyzing the choice of number of facilities in a distribution network?

Answer 6

inventory costs, transportation costs, and facility costs

Question 7

In supplier alliances, relationships with suppliers are developed for all of the following reasons except to

Answer 7

become profitable subsidiaries of parent companies

Question 8

All of the following are threats to the supply chain except:

Answer 8

Dual sourcing

Question 9

Advantages of multi-sourcing over single-sourcing include all of the following except

Answer 9

Less variability in the product