OPS FPX 5630 Assessment 1 Selecting a Supplier 

Supplier Selection Process for JM Manufacturing

Introduction

This report looks into how JM Manufacturing chooses its suppliers as it looks for a supplier for important parts for its power drill line, such as power supply units, batteries, circuit boards, drill bits, and plastic cases.  The company has decided to outsource these parts because each one needs a different kind of manufacturing.  The purpose of this report is to look at the market, look at how suppliers do business, and talk about the legal and moral issues that come up in the supply chain between JM Manufacturing and its chosen supplier.

Market Assessment

The global power tools market is expected to grow a lot, with a projected increase of 8.80% by 2028, bringing the total market value to $54.75 billion (Grandview Research, 2020).  The construction, automotive, and DIY sectors are the main drivers of this growth. These industries rely heavily on power tools to build homes, cars, and other important parts.  The COVID-19 pandemic has made demand in the home improvement industry even higher. For example, Lowe’s reported sales of more than $96 billion in 2021, which came from about 19 million customer transactions per week (Lowe’s, 2022).

 The rise in activity in the industry, along with the booming DIY market, has led to a greater need for power tools that are versatile, battery-operated, and easy to carry.  JM Manufacturing has decided to outsource the making of important parts like circuit boards, batteries, power supplies, and plastic cases because they see this trend.  A strong supply chain is necessary to provide parts that are cheap, reliable, and meet customer expectations for price, quality, and availability (Grandview Research, 2020).

Analysis

International trade makes the global supply chain better for businesses and countries by improving their relationships.  JM Manufacturing has decided that it is better to outsource production because the total cost of ownership (TCO) is lower when they buy supplies from a Chinese supplier than when they make them themselves.  TCO includes many costs, such as those for raw materials, assembly, quality control, storage, financing, forecasting, planning, and shrinkage (Drake & Sabbaghi, 2014; Sabbaghi, 2004).

 When JM Manufacturing outsources the production of parts, they must follow the seven “R’s” of logistics: the right product, time, quantity, cost, quality, location, and customer.  JM Manufacturing’s best practices stress the importance of choosing a supplier who can meet customer needs by providing high-quality goods at fair prices and in the right amounts.  To make sure that partnerships with suppliers are successful, these practices should be used in all channels (Redwood, 2020).

Best Practices

 JM Manufacturing will use a number of important methods to effectively manage global suppliers. These include understanding how suppliers work, standardization, building relationships, regularly updating product specifications, audits, compliance checks, and quality assurance measures.  The first step in the process will be to carefully look at possible suppliers, like Yangzhou Kele Power Tools Company Limited, Shenzhen TL New Energy Company Limited, and Ennopro Group Limited. 

After choosing a supplier based on their practices, JM Manufacturing will work closely with them to set the standards that need to be met.  It’s important to build long-term relationships with suppliers so that both sides can grow. Regular updates to product specifications will help with quality, innovation, and customer satisfaction.  The company will use a “trust but verify” method, doing regular audits and quality assurance checks to make sure that contracts are followed and the quality of the products stays the same (UT Haslam News, 2021).

Supplier Evaluation and Knowledge

 JM Manufacturing has talked to possible suppliers like Ennopro, Shenzhen TL New Energy, and Yangzhou Kele Power Tools.  These talks have covered a lot of ground, including accountability, production capacity, expertise, cultural fit, communication styles, record-keeping, ethical and legal compliance, and research and development capabilities (Knack, 2018).

OPS FPX 5630 Assessment 1 Selecting a Supplier 

Redwood. (2020). What are the 7 R’s of Supply Chain Management? Retrieved from https://www.redwoodlogistics.com/what-are-the-7-rs-of-supply-chain-management/#The_Right_Customer_-_Building_up_for_the_long-term

Sabbaghi, A., & Sabbaghi, N. (2004). Global Supply Chain Strategy & Global Competitiveness. International Business & Economics Research Journal, 3(7). Retrieved 

Sandford, N. (2016). Insights for Writing a Code of Ethics or Conduct. Wall Street Journal. Retrieved from https://deloitte.wsj.com/articles/insights-for-writing-a-code-of-ethics-or-conduct-1471492892

Shenzhen TL New Energy Company Limited. (2022). About Us. Made in China. Retrieved from https://tlnewenergy.en.made-in-china.com/company-Shenzhen-TL-New-Energy-Co-Ltd-.html

Timothy, H. (2022). Nine Best Practices to Managing Global Suppliers. Trace Gains. Retrieved from https://www.tracegains.com/blog/9-best-practices-to-managing-global-suppliers

UT Haslam News. (2021). Global Procurement: The Risks and Benefits to the Supply Chain. University of Tennessee. Retrieved from

Yangzhou Kele Power Tools Company Limited. (2022). About Us. Made in China. Retrieved from https://powertools-spares.en.made-in-china.com/company-Yangzhou-Kele-Power-Tools-Co-Ltd-.html