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Question 253 - CSCP discussion

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Products that share characteristics of predictable demand and low profit margin will have competition based on which of the following?

A.
Fastest to market
Answers
A.
Fastest to market
B.
Lowest landed cost
Answers
B.
Lowest landed cost
C.
Product improvements
Answers
C.
Product improvements
D.
Supply flexibility
Answers
D.
Supply flexibility
Suggested answer: B

Explanation:

For products with predictable demand and low profit margins, competition is often based on the lowest landed cost. Here's why:

Cost Sensitivity: Low-margin products are sensitive to cost fluctuations, making cost control critical for maintaining profitability.

Price Competition: In markets with predictable demand, customers often choose suppliers based on price, making the lowest landed cost a competitive advantage.

Landed Cost: The total cost of a product delivered to the buyer, including production, transportation, tariffs, and handling, determines its competitiveness.

Efficiency: Efficient supply chain operations that minimize costs across the entire supply chain help achieve the lowest landed cost.

Monczka, R., Handfield, R., Giunipero, L., & Patterson, J. (2015). Purchasing and Supply Chain Management. Cengage Learning.

Christopher, M. (2016). Logistics & Supply Chain Management. Pearson.

asked 16/09/2024
Giulia Maggio
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