Pacific Systems Report.

Student's Name

Institution

Course

Professor

Assignment Due
1.Develop a process that provides a logical order evaluating the market data and reach a

recommendation regarding how to proceed with the supplier selection process. For example, the

first step of this process may include organizing the data in a logical format. Subsequent steps

should follow from the organization of this data, and may also include additional information

that is needed to make an informed recommendation, as well as the sources of information that

may be available to do so. Present this process in the form of a flow chart with key decision

points clearly identified.

All Information Available?

Identify Collect
KeySuppliers Necessary
No Data
missing
Yes Information
SupplierElimina
ted
No Company’s
requirements?

No
Yes

Financial risk analysis and cost

Perform Financialrisk
analysis acceptable? analysis and Identify keyfinancial
costanalysis ratiosand risk analysis

Yes

PerformSupplieranalys
Supplierselecti
is SupplierNegotia Final Selection
on
tion andservice
delivery
 PerformanceMeasure
ment

2. Perform Supplier Evaluation and Selection Analysis using the worksheets / template

provided. What is your recommendation?

For any business, suppliers must be carefully analyzed and thoroughly evaluated before finally

selecting them in order to sustain strong standards and outer form competition. However, there is

no single best way to evaluate and select a supplier but rather the organization use a variety of

different approaches to finalize a supplier.

Although all relevant data might not be available for a supplier for complete evaluation in all

respects, the following key factors must be focused during supplier evaluation and selection.

1. Process and design capabilities

2. Quality and reliability considerations

3. Relative cost

4. Service back up

5. Support for capacity enhancement

6. Geographical location

7. Management philosophy and capability

8. Financial condition and cost structure

9. Planning and control mechanisms

10. Environmental and regulatory compliance

11. Shared it resources

Supplier evaluation and selection analysis and recommendation

Based on the observations of the cross functional team visiting each of the 4 suppliers the key

factors of each of the suppliers can be listed as follows

1. Elecom Technologies: -

 Located at a distance in Japan

 Huge capacity and proven capabilities for long term

 Cost effective

 High ramp-up time and tool cost

 Interested in large volumes

 Unavailability of all financial data

 Cultural differences

2. Sure Tech company :-

 Located in USA

 New to DVD with less track record

 Lack of experince

 High ramp-up time

 Reliability issue due to downtime

3. E Drive systems :-

 Nearest location

 Perceived quality issues

 Low delivery time and cost

  Moderate finacial data

4. Park Technologies :-

 Located at distant korea

 No experince with USA before

 Moderate finacial dta

 2nd lowest of cost

 Unavailability of few financial data

 Cultural differences

Recommendation based on supplier evaluation and analysis

Based on the above discusions and key obsevations the best recomandation for pacific system

would be ;

1. Select Park Technologies as primary supplier.

2. Select E Drive System as secondary suuplier for back up and emergency support in crisis.

Justification:

The choice of Asian suppliers obviously lead to certain extra costs to the large distance and

difference in country which can be summarized as follows

 Transport cost.

 Inventory carrying cost of capital.

  Storage and stock costs.

 Tax.

 Insurance cost

 Foreign currency exchange cost

 Cost of risk for the complexity of foreign import

 Cost of risk for cultural differences

Justification:-

For pacific systems although the above costs add up to extra dollars due to finacial, geographical

and cultiral difference yet it need to be noted that the quality and cost of the imported DVD is

expected to be their large scale global production.

Asian suppliers

Apart from the above factors the other challenges for pacific system for the Asian supplies are as

follows

1. The pacific system does not have an ipo to handle international purchasing process and

thus no previous experince in the same field.

2. It has to handle the foreign currency exchange related matters additionaly.

3. It has to take care of environmental and regulatory norms for inernational trades.

4. It has to bear additional tax and insurance consideration.

5. It has to take care of cultural difference between the native and Asian counries similar to

the one that made all the data not available to them from theAsian suppliers failling to

understand the requirement and importance of the same to pacific systems.

 6. It has to choose and plan for a back up suppliers in case of any sudden crisis or rise in

demand or emergency situation in international trade

Strategy and succesful from Asian suppliers

The following efforts are required from PSC to make their global sourcing strategy succesful

1. PSC has to set up their IPO to handle international purchasing process inspite of no

previous experience in the same field.

2. Design system to handle the foreign currency exchange and related matters such as

fluctuating conversion rates.

3. It has to take care of environmental and regulatory norms for international trades WTO

guidelines.

4. It has to bear additional tax and insurance consideration.

5. It has to tke care cultural difference between the native and Asian countries similar to the

one that made all the data not available to them from the Asian suppliers failing to

understand the requirement and importance of the same to pacific system.

6. It has to choose and plan for a back up supplier in case of any sudden crisis or rise in

demand or emergency situation international trade.