Procurement and Supply Chain

Procurement and Supply Chain
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Table of Contents
Introduction.................................................................................................................................................2
Main Context...............................................................................................................................................2
Case Study – Sapphire Energy....................................................................................................................2
Case Study –AusCotton...........................................................................................................................4
Challenges Identified in both Sapphire Energy and AusCotton...............................................................6
Recommendations...................................................................................................................................6
Conclusion...................................................................................................................................................7
References...................................................................................................................................................8

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Introduction
The paper will analyze the Laburnum case study under which two companies AusCotton
and Sapphire Energy will be considered. Currently, both companies are facing many issues, and
the top management of both companies will examine their respective business strategies.
AusCotton deals with sportswear and Sapphire Energy deals with energy cables. AusCotton has
appointed a new Senior Vice President of Supply Chain. The newly appointed Senior Vice
President of Supply Chain in AusCotton will address the issues procurement and supply chain.
Sapphire Energy has appointed a new Inventory Controller. The newly appointed Inventory
Controller in Sapphire Energy will evaluate the efficiency of the existing ordering system.
Main Context
Case Study – Sapphire Energy
Answer 1
Evaluation of the Effectiveness of the Current Ordering System in Sapphire Energy
The business of Sapphire Energy is involved in supplying electric service to the clients of
Bendigo, Traralgon, Geelong, Mildura, Sunbury, Melton, Wodongra, Shepparton, Wangaratta,
and Ballarat. There are different kinds of materials which are utilized to supply this service. One
of these is 1/0 AWG aluminum triplex cable which helps to supply electricity from the
distribution pole of the houses.
The new Inventory Controller of Sapphire has noticed that the Eastern Power has agreed
with Sapphire Energy and storeroom of Eastern Power will utilize the cable service of Sapphire
Energy. The cable is utilized in a regular service operation, so it is installed between five
working days of the week (De Araújo, Alencar and de Miranda Mota, 2017). Due to service
needs of expanding the business, the demand of cable will increase up to 155,000 meters. At
present, the carrying price of the cable is $1.35 per meter. Eastern Power has agreed with its
supplier to divide the annual needs into twelve parts. So, Eastern Power will withdraw one-
twelfth of the total annual requirement per month.
Before the contract, the lead time would continue up to twelve weeks. The contract will
also decrease the lead time by assuring a fixed place to Sapphire Energy in the production