Unilever PLC planning to meet the environmental protection strategy including an introduction of the UN approved 120-litre plastic open-top drums, known as the Blue-drum. It was highlighted in 2022 AGM that Comfort one of their products delivered high growth in Latin America, South Asia, and Turkey, but declined in Europe where consumers reduced their spending in the category. Hence, the company is trying to reduce cost in producing plastic containers used for this washing detergent product, Comfort. Assume that cost of manufacturing 100-pack of Blue-drum includes direct material at 18, direct labour is 10 and variable overheads at 2. The depreciation of a special equipment is 4 with no resale value, supervisors wages is 6. Including the general factory overheads which is allocated based on direct labour hours, the total cost manufacturing is 50 per a drum, based on 30,000 packs of drum produced each year. However, an external supplier, unlisted PLC has offered to provide the same quantity at 40 per drum.

Task 1: Critically discuss factors that Blue-drum PLC should consider choosing between the making or buying of the Blue-drums.

Task 2: You are also required to critically evaluate three relevant factors to be considered for suitable sources of finance to fund the Blue-drum investment compared to the unlisted PLC supplier of plastic Blue-drum. Show all workings.