Read the statement below and answer all five questions that follow:

The procurement professional task is to reduce the cost of product, material or service through supplier relationship development and negotiations. In addition, procurement professionals have a responsibility to create value for the firm in terms of cost reduction and improving the quality of the item. Generally, the material cost is two and a half times the payroll costs. It is for this reason that companies place a high value on procurement professionals who can improve product quality while also saving money. https://www.intechopen.com/books/modern-perspectives-in-business-applications/introductory-chapter-purchasing-and-supply-management.

You are managing a purchasing department of a food manufacturing company in South Africa. Your company's board of directors needs you to discuss the following topics and explain how your position will assist in creating value for the food manufacturing company in terms of cost reduction and improving the quality of the item:

Answer ALL the questions in this section.

Question 5

Purchased goods must be transported from the point where they are grown, or manufactured to the place where they are needed.

Fully discuss any six factors to be considered when selecting mode of shipment, carrier and routing. Use the relevant examples from the food manufacturing company. (12 marks)

Give four reasons why the selection of the FOB point is important to the food manufacturing company as a purchaser.