Exam (elaborations)
MNP3701 ASSIGNMENT 6 SEMESTER 1 OF 2022
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, TOPIC 1a. Starbucks has managed to stay ahead of most of its competitors, thanks to its
strategic sourcing which has helped the company a build long-term
relationship with its suppliers. Starbucks South Africa must consider the
following alternatives to keep growing and ahead of the competition.
Low-cost Country Sourcing, this a method that focuses on benefiting from the
competitive advantage of other countries which are able to offer lower labor
and production costs for example Starbucks South Africa should consider
working with farmers in Uganda and other coffee producing countries where
the climate is good and labor is cheap.
To minimize the risks that comes with low-cost sourcing from a single country,
global sourcing from selected suppliers from different geographies can boost
the supply chain resilience for instance paper cups can be imported from
China.
Prime/Sub Arrangements the job is sub contracted by the outsourcing agency
to another organization and the actual transactions are between them, saving
Starbucks of all the challenges of regulatory compliances. For example,
Starbucks can develop a proprietary certified system of coffee purchases to a
specific roaster. The certification guarantees that the product is of high quality
and that the coffee comes directly from the farmer that exports it. The roaster
will then visit farmers who are willing to with under the certification.
Captive Service Operations can also be a useful strategy where Starbucks
has franchise and doesn’t want to sell its business formular or its best
ingredients. For example, the shop in Durban can receive all the Coconutmilk,
Strawberry Acai Base and other unique products direct from the Head office in
Johannesburg.
Starbucks conventional agreements with suppliers who provide basic cleaning
detergents. The agreement involves addressing the same requirements cost,
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