Read the scenario below and answer Question 2 and Question 3 that follow:

Woolworths Food is a large well-established company in South African selling and distributing fast[1]moving consumer goods (FMCG).

JOHANNESBURG - Woolworths has stepped up its efforts to provide customers with supply chain

transparency. As part of this campaign, they have released the full list of who their suppliers are and

where they are located. The list revealed that only 13% of Woolworths' suppliers are South African,

while 63% of them are Chinese. However, their clothing is mostly made in factories in African countries,

rather than India, which is a popular location for other clothing stores.

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Woolworths has admitted that due to the seasonal nature of many of their products, they may take on

new suppliers at times who are not on the general list. The list also doesn't say how many products they

order from each supplier.

Previously, Briefly News reported that Woolworths SA has had to recall an entire batch of apple juice

cartons after it was confirmed that many of the products may not be safe for consumption. Following

routine quality tests, the company says it has detected severely high levels of a certain mycotoxin in the

fruit juice boxes. According to the World Health Organization, extremely high levels of this toxin can

cause vomiting, nausea, and gastrointestinal disturbances. Naturally, Mzansi was not at all impressed

and headed to the comments section to react. While people were happy they might receive a refund,

others wondered what the health consequences might be.

Source: https://briefly.co.za/business-economy/117173-woolworths-reveals-all-351-suppliers-bid[1]supply-chain-transparency-63-are-chinese/

Question 3 (Marks: 30)

Q.3.1 Discuss what is supply base optimisation then justify why Woolworths should or

should not engage in supply base optimisation.

Note: You are required to provide a paraphrased overview of the concept before

justifying your stance with at least two application points.

(10)

Q.3.2 With the FMCG market being so competitive, explain how Woolworths can go

about implementing strategic sourcing. You are required to explain the first three

steps in the strategic sourcing process and then relate each to Woolworths.

Note: You are required to provide a paraphrased overview of the steps before

providing at least one comprehensive application point per step