BUSS 2 - June 2009, Discuss whether Just Desserts Ltd should choose its new supplier solely on the basis of the quality of the supplier's products. (12 marks)

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  • Created by: Sharmista
  • Created on: 16-01-13 17:55

Suppliers are businesses that provide goods or services to other businesses; Quality exists when a product satisfies customers needs

Advantages

  • The company's image is that of a quality/luxury supplier and this will be difficult to maintain without suppliers providing good quality ingredients.
  • Issues such as price may be less relevant for Just Desserts Ltd as pricing is not a major issue for this company.

Disadvantages

  • Reliability will be important in terms of delivery if the factory is to have uninterrupted production - having a supplier at a substantial distance away will make this more difficult.
  • Just Desserts Ltd is suffering from cash flow difficulties as it expands; therefore trade credit terms are likely to be an important factor (at least in the short term)
  • Capacity will be an issue as Just Desserts Ltd is growing as may need increasing amounts of supplies over time

Evaluation

Ultimately Just Desserts Ltd will choose its new supplier on the basis of a range of factors, however quality may be a particularly important one, as the product itself is the main reason as to why customers choose to purchase their food in particular.

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