Question: The Red Lobster (RL) restaurant chain has been using two seafood vendors for lobster: Cape Cod Fisheries (CCF) and Maine's Best. Lobsters from CCF averaged

The Red Lobster (RL) restaurant chain has been using two seafood vendors for lobster: Cape Cod Fisheries (CCF) and Maine's Best. Lobsters from CCF averaged \$2.20/pound last year while Maine's Best averaged $3.33/lb. While quality has been good from both vendors, CCF continually delivers late and RL has to pay the dock employees overtime to accept deliveries. Last year's overtime costs were $50,000. RL purchased a total of 100,000lbs. last year from CCF. CCF is now having quality issues and RL had to discard several hundred lobsters. This increased nonperformance costs and the SPI for CCF is now at 1.45. What is the true cost for lobsters sourced from CCF? Same as Maine's Best at $3.33/lb $3.19/lb Not enough information available $2.20/lb $3.65/lb

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