Suppliers

Question 1

What are the 9 Factors Affecting the Choice of Supplier?

Answer 1

Price
Quality
Quantity
Location
Lead Time
Reliability
Reputation
Discounts Available
Credit Terms

Question 2

What is the Price and what is its Justification?

Answer 2

How much the supplier charges for raw materials.
Price needs to be as low as possible in order to maximise profit.

Question 3

What is Quality and what is its Justification?

Answer 3

The standard of raw materials sold by the suppliers.
The higher the quality of raw materials, the higher the quality of the final product should be.

Question 4

What is Location and what is its Justification?

Answer 4

Where the supplier is situated in relation to your business.
If the supplier is located further away you may be charged a higher delivery fee.

Question 5

What are Discounts available and what is its Justification?

Answer 5

When your supplier reduces the price of the raw material.
Allows the business to reduce costs if putting in a bulk order.