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A manufacturer is working to standardize high-volume, low-cost hardware components used in its assembly process. The manufacturer wants to transfer some of the risks associated with inventory carrying costs, warehousing costs, and re-stocking costs to the supplier. Which of the following will be MOST useful in accomplishing this goal?
Suggested Answer: A
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9 comments · newest first
JO
Joseph
2 days ago
Wait, can vendor-managed inventory really reduce costs that much?
AN
Anisha
7 days ago
B) Reorder-point system is also good for managing stock levels.
AL
Alaine
12 days ago
But isn't that risky for the supplier too?
WA
Walker
18 days ago
Totally agree, it shifts the burden to the supplier.
MO
Moon
23 days ago
A) Vendor-managed inventory is the way to go!
CH
Chery
28 days ago
I feel like vendor-managed inventory is the most logical option here, especially since it directly involves the supplier in managing inventory, but I could be wrong.
TA
Tawna
1 month ago
Safety stock seems like it would just add to the carrying costs, so I don't think that's the answer. I might lean towards Kanban, but I need to double-check how it relates to supplier risk.
FL
Flo
1 month ago
I remember practicing a similar question where we discussed the benefits of a reorder-point system, but I don't think it really transfers risk to the supplier like vendor-managed inventory does.
JO
Joni
1 month ago
I think vendor-managed inventory could be the right choice since it allows suppliers to manage stock levels, but I'm not entirely sure how it affects costs.