Prepare an example of two competing suppliers (fictitious) who have different total landed costs (TLC) for their product at the purchasers location.

In your example, please include a variety of hidden procurement costs. Also, ensure that you add logistics costs as well. Logistics can include warehousing costs if you wish.

Do not include the input costs to each supplier. Just include:

• Product price to the customer
• Logistics price to the customer
• Hidden costs incurred by the customer

The numbers and values for your product and the logistics/warehousing costs can be made up, as will be the hidden costs. However, in your discussion, you will explain why the costs exist as they are presented.

Provide a suggestion for the purchasing company as to which supplier they should select. Hidden and logistics costs will be part of the Strategic Sourcing decision. The more elements of Strategic Sourcing you add, the better you are showing that you understand that Strategic Sourcing is not just about the basic product price. Basic product pricing is only part of the TLC.

This assignment requires some thinking and time to complete. If you complete this assignment really quickly, you've probably missed lots of the TLC issues.

Please submit a Word document as follows: