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  • Essay / Heavy Pumps Case Study - 967

    For example, CJI should inform Heavy Pumps of changes in demand for bilge pumps, with the new demand being 50 pumps per month from July onwards. By providing Heavey Pumps with better insight into supply needs and material schedules for the following months, Heavey Pumps is able to measure its ability to better meet future requirements, which then results in a high level of services and lower logistics costs for both parties ( Weele, 2005). CJI should also personalize the relationship by meeting regularly and always staying in touch with Heavey Pumps to discuss any changes in plans, threats and opportunities. The next suggestion would be to form a written contract between two parties. Although oral contracts are acceptable and legally binding, they are nevertheless very difficult to rely on in court. The contract will be key to effective governance of the relationship between CJI and Heavey Pumps (Benton, 2010). One of the benefits of entering into a contract is to secure supplies and avoid price volatility. For example, Heavey Pumps is not able to increase the price but instead produce and supply the bilge pumps at an agreed price of $1,500 per unit. Additionally, maintaining a strong, long-term relationship with the supplier requires understanding the needs of both parties. Heavey Pumps will definitely provide quality products at the best price if treated with courtesy and