MGT301, Spring 2016 Assignment 4 - 25 Points Name_________________________ Question 1 Your company makes snow blowers and this winter they have been selling very well. You are evaluating a quote from a supplier for engines that power your snow blowers. The quote is as follows: Price Terms Distance Order quantity Weight Tooling Quality Failures Supplier 1 $90 2% 10 Net 45 200 1500 20 lbs $25000 3% Assume the following: Annual volume for engines is expected to be 90,000 units Inventory holding rate is 25% Cost to place an order is $100 Working capital costs are 12% Your freight rate is $1.75 per ton mile for a full truckload (40,000 lbs) and $2.00 for a less-thantruckload shipment There are 365 days in a year. Late-delivery costs should be ignored. What is the total cost of ownership for supplier 1? (Show your work.) 1 MGT301, Spring 2016 Assignment 4 - 25 Points Name_________________________ Question 2 A company using a weighted-criteria evaluation system has established these 3 categories for supplier evaluation and the appropriate weight are in parentheses: Quality(0.50), Technology(0.20), Cost(0.30). The scores for each category for Company A are: Quality(90), Technology(75), Cost(60) The scores for each category for Company B are: Quality(80), Technology(95), Cost(90) The scores for each category for Company C are: Quality(90), Technology(80), Cost(95) Calculate the weight score for each supplier? Which supplier would you consider your top supplier? Based on our discussion in class, what category would you place the suppliers? (Show your work.) 2