Choice of suppliers

• What effect does the choice of supplier have on production costs?

  It has a direct effect on how much it costs the company to produce a product.
• How does a higher cost of raw materials influence production costs?

  A higher cost of raw materials will lead to a higher cost of production.
• What could happen if a company finds a cheaper supplier?

  It could lead to increased profit.
• What is one advantage of a supplier being located nearby?

  It will be cheaper to buy/deliver.
• Why is it better for a supplier to be closer if the product is perishable?

  Because it would be cheaper and more efficient to deliver.
• How does the quality of raw materials affect a business's finished product?

  The quality of raw materials will have a direct effect on the quality of the finished product.
• Why is it important to source supplies of a high standard?

  To ensure the finished product is of high quality.
• What can happen if a supplier does not deliver on time?

  It can affect a business's ability to produce and deliver their product to the customer.
• What are the factors to consider when choosing a supplier?

  • Does the supplier offer discounts?
  • Does the supplier offer trade credit?
  • Are there any additional charges?
  • Can the supplier deliver on time?
  • Are the supplier's prices competitive?
  • Is the supplier able to supply the quantity needed?
  • Are the supplier's goods of acceptable quality?