A Sourcing Strategy for High-Cost Dog Meat

A Sourcing Strategy for High-Cost Dog Meat

Introduction

A sourcing strategy is a strategy in which the best candidates are identified by an organization with a need to obtain goods or services from such candidates. It is a supply chain management function or rather a procurement function in which the best candidate is identified through the use of some specific criteria such as the ability to perform outstandingly without failure. However, in procurement, sourcing entails contracting a business process to another person whereby the company which is sourcing does not in any way in the provision of such processes.  The purpose of this essay is to develop a sourcing strategy for a high cost of dog meat.

Dog meat is considered a good diet in most countries like China and Taiwan because of its high nutritional value (Burton, 38).  As a red meat, the dog meat is believed to have some benefits such as rising body temperature and improving the blood circulation in our bodies. It also reduces the risks for cancer and dementia which are common infections affecting people. However, most nationals do not consider dog meat fit for consumption. A large restaurant in China is therefore in need of high-value dog meat so that it can add to its list of food. This means that there is a need for the purchasing manager of the restaurant to source for the best supplier possible who will be delivering this meat as at and when required by the restaurant.

Supplier selection

According to Luthra (1686), supplier selection is a very important activity in a sourcing strategy. In this process, the organization that is procuring the high-value dog meat needs to look for the best supplier who is not faced with any inefficiency. Before sourcing for the best supplier for the dog meat, it is important for the organization to identify the value of the need of the dog meat by assessing the frequency of their purchase (Vargas, 78). The buying organization should also consider its budget so that it purchases what it can afford. This will, however, depend on the purchasing needs of an organization. In our case, the business will use a selective business outsourcing (BPO) strategy to obtain dog meat (Luthra, 1687).

In order to select the right supplier for the dog meat, it is important for the buying organization to undertake both financial and technical evaluation so as to determine the suitability of such supplier (Burton, 39). After the best supplier for the dog meat has been identified, what follows is to measure the performance of that supplier by searching about his past history (Luthra, 1689). Under this, the purchasing organization will look for delivery commitments, reliability and responsiveness, and resource saving. This will be then followed by the supplier feedback whereby a self-assessment questionnaire is used (Vargas, 81). This will enable the purchasing organization to obtain proof that the supplier can deliver dog meat at the right time. If the right supplier is selected, specifications for the dog meat need to be provided to enable him to deliver the right quality and quantity. This relationship between the supplier of the dog meat and the organization should be maintained (Luthra, 1692).

Total Cost of Ownership

Caniato (427) says that total cost ownership will enable the organization to carry out the best financial estimate so as to enable it to determine both direct and indirect of obtaining dog meat. It is a management concept that can be used in undertaking to account for dog meat (Vargas, 82).  In procurement, the total cost of obtaining a product does not only entail the price of the item only but also other costs such as costs of transporting the dog meat to the destination, cost of storage and both holding and ordering costs (Caniato, 429). In undertaking the total cost of ownership, the buying organization will determine both costs of direct materials, direct labor for those who are handling the dog meat as well as other expenses.

TCO makes an analysis of the difference between the purchase price of the dog meat and the long term cost which the buying organization might incur as a result of using dog meat (Burton, 42). It is always important for the purchasing organization to obtain value for money for their transactions. This means that the sales which the organization will obtain from the value dog meat should be higher the price of obtaining the dog meat (Caniato, 433). This means that for the organization to obtain profit, the amount obtained from the dog meat should be higher than the amount that is paid to the customers as well as the other expenses such as storage costs and ordering costs. TCO is important because it will show the organization what it will end up spending when purchasing the dog meat (Caniato, 436).

Conclusion

The importance of sourcing in a business is that it plays a very significant role in the cost structure of an organization as it lowers most of the costs that are associated with the contracting of business processes. Also, sourcing makes the organization that is undertaking sourcing to obtain goods and services using the minimum cost, in what is termed as value for money. It is also important to note that a sourcing strategy entails the examination of purchasing budgets, undertaking market analysis and supplier negotiation. Also, sourcing is the best tool to help organizations especially when they want to make high volume purchases as it facilitates cost saving.

Works Cited

Burton, Terence T. “JIT/Repetitive Sourcing Strategies: ‘Tying the Knot ‘With Y.” Production      and Inventory Management Journal 29.4 (1988): 38.

Caniato, Federico, et al. “Total cost of ownership along the supply chain: a model applied to the               tinting industry.” Production Planning & Control 26.6 (2015): 427-437.

Luthra, Sunil, et al. “An integrated framework for sustainable supplier selection and evaluation                 in supply chains.” Journal of Cleaner Production 140 (2017): 1686-1698.

Vargas, Federico. Optimal Sourcing Strategies for Managing Supply Chain Risk for Platinum       Group Metals in Automotive Catalytic. Diss. 2016.