LCC Medi

cal produces medical devices. LCC is evaluating three Tier 1 suppliers to manufacture the component part in a certain size. Annual demand for this stock-keeping-unit (SKU) is 20,000 units per year and we assume 250 working days in a year. Other info shown below in exhibits 13.17 and 13.18.

1. what is the total supply chain and logistics cost for each supplier when Q=5,000 , Q=10,000 , and Q=20,000?

2. What supplier and order quantity do you recommend based on total supply chain costs?

3. Given your total supply chain cost analysis and the qualitative criteria in exhibit 13.18 using a weighted scoring model of your own design, what are your summary scores for each supplier? (You may decide how to score each criterion, the weight of each criterion, and whether to include costs or not)

4. what are your final recommendations?

Price per EXHIBIT 13.17 LCC Medical Manufacturing Economic Outsourcing Information for a Surgical Kit Management Cost to Price per Price per Oversight Transport Store One Order Lead (Tier 1 Unit (P) Unit (P) @ Unit (P) @ Cost (0) per Mode Cost Order Time (L) in Supplier) @Q= 5,000 Q=10,000 Q=20,000 Unit (C) per Unit Costs (C) Year (C) Days Xiaying $1.25 $0.99 S0.70 $0.35 50.25 5655 50.00 $170 5160 $1.55 $0.15 SO 15 5260 Werkzeug $1.60 $135 $130 $0.20 SO Unit per MedicUSA 5020 $350 Werkzeug EXHIBIT 13,18 LCC Medical Manufacturing Qualitative Sourcing Criteria for a Surgical Kit Rank Order (1 - worst, 5-best) Supplier Selection Criteria Xlajing Medic USA Delivery reliability 3 5 Product quality 3 Single supplier risks (sole sourcing) High Moderate Product and customs uncertainty obsolescence, fees, work 3 stoppages, etc.) Sustainability practices (green supplier) 4 Moderate