1. Supplier Management

2. Trade offs The Fresh Connection is full of trade offs
Over multiple roles and within roles
Sometimes conflicting with role incentives
Capacity mgt
TCO
Product characteristics
Demand
mgt
Supplier mgt
Inventory mgt

3. Supplier selection How to select the best supplier?
What criteria did you use?
How to prioritize them?
Lowest price
Lowest cost
Fit with strategy

4. What is Total Cost of Ownership?
In supply chain management, the total cost of ownership of the supply delivery system is the sum of all the costs associated with every activity of the supply stream. The main insight that TCO offers to the supply chain manager is the understanding that the acquisition cost is often a very small portion of the total cost of ownership
(APICS Dictionary, 12th edition)
In other words: quantifying all procurement related costs of a supplier or a component

5. What is Total Cost of Ownership? (cont)
What related costs can you mention for the Fresh Connection?
Product costs
Transportation costs
Quality costs
Interest
Inventory & payment terms
Handling costs
Administration costs
Warehouse costs
Explore TFC
Calculate this costs for one of the components in %
How to influence this costs
What does this mean for your supplier policy

6. Product characteristics
Product characteristics are important. The focus of total costs of ownership will change.
Explore TFC
What is the value per pallet for the components?
What is the volume and value per week per component?
How will the difference in characteristisc influence the policy?

7. Product characteristics are important for designing a supply chain configuration
Type
Value per pallet
Purchase value
Need per week in pallets
Pack
518
109K 7
PET 32
292 K
188
Orange
400
406 K 35
Mango
900
72 K 3
Vitamin C
150
1 K
0,1
Waarbij m3 is gedefinieerd als opslag- cq. laadruimte
Afgeleid van Ploos van Amstel’s combinatie van waardedichtheid en verpakkingsdichtheid (in collo/m3).
How does this influence inventory policy and supplier selection?

8. Product characteristics and policy
Volume/week
Trasnportation handling and warehousing
100
Price and availability 10
Transportation and
availability 1
100
500
1000
Value/pallet