A European consumer electronics company, EUROELECTRONICS, produces multiple products under three different categories:

1. car audio visual equipment
2. home audio visual equipment
3. home security solutions.

Each product category has multiple product models which are offered in multiple variants leading to a large number of end products.

EUROELECTRONICS is known for high product quality and usually has charged premium prices for its products, but its sales growth has stagnated in the face of competition from Korean and Japanese competitors.

It sources multiple electronic components from manufacturers. Now, EUROELECTRONICS is planning to launch new products in each of the three product categories and accordingly, there will be increasing demand in Asian, European and North American markets.

The existing suppliers for each product category also need to be evaluated along with potential new ones, using criteria like cost rating, quality, lead time for their suitability to supply existing as well as new products, and new supply contracts will be made. Thus, even though there are existing suppliers, their contracts are up for renewal or rejection. With the launch of new products, a new set of suppliers (can include existing ones) will be selected who will supply both existing as well as new products. Currently, suppliers A and B supply car audio visual components, suppliers E and F supply home audio visual components and suppliers G and H supply home security components.

Potential new suppliers, C and D, can supply both car and home audio visual products while I and J can supply home security products. Note, high cost rating means low cost and hence it is preferable. High-quality rating is preferable while a low lead time is preferable.

EUROELECTRONICS needs to first determine the optimal number of suppliers for each product category considering the disruption risk of individual suppliers, some super event affecting all suppliers and the variable cost of operating the suppliers. Once the suppliers are selected, decisions need to be made about which supplier will supply to which plant to supply what proportion of the demand.

The relevant data about the suppliers for the product categories are provided in tables in the appendix.

Questions:

2a) Determine the optimal number of suppliers that EUROELECTRONICS should have for car audio visual, home audio visual equipment and home security solutions.

2b) Based on the data provided, select the suppliers for each product category.