Wanda Lux must select a supplier for a plastic bottle and proprietary dispenser for its new hair shampoo. Three suppliers have placed bids; at Wanda€™s request all bids are for a shipping quantity of 20,000 bottles with annual requirements of 40,000 units. Wanda€™s factory operates 250 days a year. The first table shows each supplier€™s price estimated annual freight costs, and current lead times; management has added estimates for holding costs and administrative oversight costs for each supplier.
Beyond costs, however, Wanda has three other criteria considered important in the selection of a supplier. The second table shows all the criteria, their weights, and the scores for all of them except total costs, where a score of 1.0 indicates €œpoor€ and 10 indicates €œsuperior€. Because all three suppliers have done business with Wanda Lux before, management will assign a score of €œ10€ to the supplier with the lowest total annual cost, a score of €œ8.5€ for the next lowest cost, and a score of €œ7.0€ for the worst cost of the three.

a. Which of the three suppliers will provide the lowest annual cost to Wanda 1&ax?
b. Given Wanda€™s criteria and weighting system which supplier should Wanda award the contractto?

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Score Criterion Total Cost Consistent Quality On-Time Delivery Weight Dover Evan Farley 30? 3 99 899 20 8 7 Environment Supplies Freight Costs Price/Unit Annual Holding Cost Per Unit Lead Time (days) Annual Administrative Costs Dover Plastics Evan & Sons Farley, Inc. $3,500 $3,000 $4,500 $5.10 $5.05 $5.00 $1.02 $1.01 S1.00 $4,000 $6,000 $3,000