Business Studies

Instructions
Part I: The Case Study link below is for the Case Study 3. Read and study the case and address each of the questions at the end of the study. In addressing each of the questions, create a Power Point presentation to include the following:

– Problem

– Identify and describe alternative solutions

– Justify your recommendations for EACH question

Part II: In addition to the Power Point presentation, a 10-15 minute video will be required using Kaltura. In this video you will summarize your findings from your Powerpoint. This part of the assignment will provide the visual presentation of the case study.

Instructions: Attach two files to the Case Study #3 assignment: 1) Power Point presentation (.ppt or .pptx file) and 2) Kaltura video. To access Kaltura, click on the “Add Stuff” icon on the toolbar of the Comments Box at the bottom of this screen.

ANSWER

Tehindo Supply Chain Network

Comparison between the bottled Goteh and Fteh in terms of challenges in managing their supply chain process

The Tehindo Company is known and best for making geed tea and its many tea variants. The main three types of products they have are the Goteh, the Fteh, and the Cteh. The Goteh does not have as many variants as the Fteh, and this comes as a disadvantage to the Goteh variant since it only dwells on a very few of the Fteh variants. The variants have an issue with the supply chain processes which they follow. The company follows strict supply chain processes in its supply processes (Villa et al., 2022). The first one is that they deliver directly to the customers when the demand is higher than normal this is the direct supply. The second channel they use is to deliver to wholesalers and retailers, who then act as intermediaries to bridge the gap between the company and the customers (Villa et al., 2022). The intermediary is responsible for updating the company with the relevant information that they get from the customers and passing it back to the relevant channel so that the company can know what the customers are saying about their products (Villa et al., 2022). The other channel is that they use a distributor manager who handles the forwarding of the products from the company to the customers. This distributor acts as a third-party man who is usually based on contracts that the company offers them for some time to be their supplier (Villa et al., 2022).

There exist similarities in the comparison between the two types of Tehindo products. The first similarity is that they both use the same means and channel of distribution, which impacts the companies’ supply process in a great manner (Villa et al., 2022). The channel where they use the retailers and the distributors is good but at the same time is risky because the retailer is known for hiking the prices of products and giving the customers the wrong product price for no reason, even if the company has not yet announced plans to hike the prices. It creates a bad image of the company to the customers who purchase their products from these retailers and wholesalers. They are also known for providing the wrong information to companies. Tehindo is no different from other companies, so they are also prone to victimization by this type of wholesalers. Giving wrong information is bad business for the company since the company will not be able to evaluate itself and its credibility in the business scene (Villa et al., 2022).

Also, using the channel with the third party distributor is risky, especially if the company has no policies against working with third parties in their business. There exist policies that are put in place so that a company can work with third parties without fearing any incident occurrence (Villa et al., 2022). These third parties are known for suing the companies they work with over small misunderstandings and small business issues that they had agreed upon; hence, they end up benefiting from the whole saga financially because of the strong evidence they had placed against the companies. It can be avoided in the case of Tehindo by taking policies as advised by their legal advisors like attorneys (Villa et al., 2022).

The bottled Fteh has been known to have trouble with its packaging, and the bottles that they use are RGB produced separately in companies also owned by the Tehindo Corporation (Villa et al., 2022). The shortage of supply of some variants of the Fteh type has been experienced in some of the branches of the Tehindo group. The shortage has created an outrage among the customers who consume the various variants of the Fteh type. It has disadvantaged the company since the supply should be constant so that the returns can match the sales that they make of the Fteh (Villa et al., 2022). This step back in the Fteh supply chain process has been a major factor that the company should look upon and work on. The company has been ensuring that the bottles issue does not occur by ensuring that the resellers who order the drinks get them if only they give out the empty bottles (Villa et al., 2022).

The issue with the supply process of the Goteh variant is the lack of many variants like the Fteh type. The Fteh type has been a promising future booming product for the company since their major target group is the teenagers who make up most of the population. So many different people enjoy the many variants since each person has their unique taste and preference. The Goteh type should also have the same number of variants, just like the Fteh variant. By ensuring the number of variants is increased, they increase their market chance by a higher advantage that makes their supply chain a lot faster and a lot more efficient (Villa et al., 2022).

Temporary cause of demand increase in this supply chain

The temporary demand increase in the products is attributed to many factors. The first factor is social events. They dictate the demand for a product. There is a time when the demand is higher due to various social events and gatherings like marriage ceremonies, birthday parties, parties, and major social events, not excluding company meetings. This event saw a major boom in demand for the company products that had not been sold yet. The company is forced to keep up with the demand for the products as the production on this type of event is higher. It always comes as an opportunity for the business to make record-breaking sales and supply in the events they have been tasked with supplying (Villa et al., 2022). It causes a major effect on the supply chain as the products produced are now directed to the major supply jobs that the company has to meet. The other resellers and the third parties in the business now see a major drop in the supply of the products from the company since they cannot satisfy the two customers on time and have to forego one for a short period at the expense of the other one (Villa et al., 2022).

Also, it leads to heavy costs in the supply of the products they have been ordered to deliver. They have to incur the cost of supply since the company has been tasked with delivering the products to these places and events (Villa et al., 2022). The supply of the units also means that there will be a rise in the cost of supplies, including the increase in the cost of the raw materials used in the production, and the supply chain too can be expensive. Suppose the company is in no position to manage the supply of all the products at one time. In that case, they need to employ other temporary parties to help them in the supply process, like the supply channel’s third-party distributor (Villa et al., 2022).

The suggestions I would in the second meeting make if I was the supply manager

If I were the supply chain manager, then I would have suggested that the company should not decrease the product variants. The reason is that the product variants increase the revenue of the company. It is attributed to the wider community of people using the products and the different variants (Villa et al., 2022). As the supply manager, I looked at the record, and the different variants were doing rather well compared to the one variant. The variants contribute differently to the overall revenue, and the supply of the variants has been higher depending on the demand of the type of variant at the time. The population and customers have been asking for the different variants at different seasons (Villa et al., 2022). There is a season when the demand for one variant is much higher than that for another variant. The general variants each have their different pick seasons and periods. If I were the supply chain manager, my overall opinion is that the variants instead of being reduced should be increased and no they should not be reduced as they play a great role in the supply chain. Each variant is supplied differently according to the market trend (Villa et al., 2022). The variants are also good for learning the market trend and determining what markets to emulate and how to manipulate the market as a supply manager (Villa et al., 2022).

How information distortion happens in the supply chain and how to reduce it

Information distortion is when the right information does not reach the necessary channels and when the information does not reach as original as it was gotten (Villa et al., 2022). This distortion can happen in so many ways depending on which field the company is being analyzed. In supply and demand, distortion occurs when information from the wholesalers is not correct from the one they collected from the consumers (Villa et al., 2022). The wholesalers are the ears of the suppliers, in this case, the company, as they help in the passing of the information gotten from the consumers back to the suppliers. This information can consist of the variant that the customers like, the amount that the resellers want, the improvement in the product that the consumers want to see, and the general overview of the product by the consumers (Villa et al., 2022). If the reseller, the retailers, and the wholesalers give the wrong information, it affects the company’s view of the products and what changes they can make. It can be avoided by deploying personal sellers to the markets so that they can collect the information themselves and take it back to the company. Also, they can give an overview of the market and the reseller’s views of the products (Villa et al., 2022). Knowing their competition is another advantage to the company as it helps them know who they are matching up against (Villa et al., 2022).

Advantages and disadvantages of vertical integration and outsourcing for Tehindo

Vertical integration is whereby the company owns the supply chain and is responsible for its integration (Heeringa et al.,2020). Outsourcing is whereby the company hires a third party to do some part of the company process (Aswini et al.,2018). The various advantages of vertical integration allow them to stay different from other companies. They increase their profits, losses due to the supply model are attributed to the company, and they take responsibility and maintain quality control of the products they deliver (Heeringa et al.,2020).

Disadvantages

It may lead to distortion of the supply channels that the company previously had. It may lead to an unprofitable outcome if the supply is not effective. Lastly, it may lead to a high cost of supply and labor that has not been accounted for (Heeringa et al.,2020).

The advantages of outsourcing are that it enables the business to focus on their core business and leave the rest that is unimportant to them. It enables the company to save time and resources which could have been used. It enables the business to save on the cost of the process they have assigned. It enables the company to reduce risks (Aswini et al.,2018). Some of the disadvantages are that it may lead to miscommunication between the third parties and the business, making the business suffer from security risks. The business may also lose control of managing the third parties hired (Aswini et al.,2018).

References

Aswini, K. (2018). Advantages and disadvantages of outsourcing. Shanlax International Journal of Commerce, 6(S1).

Heeringa, J., Mutti, A., Furukawa, M. F., Lechner, A., Maurer, K. A., & Rich, E. (2020). Horizontal and vertical integration of health care providers: a framework for understanding various provider organizational structures. International journal of integrated care, 20(1).

Villa, S. (2022). Competing for supply and demand: Understanding retailers’ ordering decisions. International Journal of Production Economics, 244, 108355.