Aloha Products Case Study Summary
I. Point of View
As proven in the case 7-4, Aloha Products faced different issues with its departments within the Purchasing Unit which operates disorderly that cause the inefficiency and ineffective allocation of sources.
II. Statement of the Problem
This study sought to reply the next questions:
1. What ought to the corporate do to resolve the issue relating to the Purchasing Unit? 2. What are the things that the Purchasing Unit must think about before taking decisions? 3. What should the corporate do to minimize their value of sales?
This research aims to alter the current management system for the Purchasing Department and to unite the Purchasing Department with the Manufacturing Department.
IV. Areas of Consideration (Analysis of the Case)
1. External Environment
Having a common product on your firm means having many rivals for it. Especially if these corporations had appreciable resources: infrastructure, distribution networks, model equity, production sources, and marketing expertise that Coffee Giants like Nestle, Philip Morris(Maxwell House) and P&G(Procter & Gamble) have.
In addition to these coffee giants, there were a number of area of interest gamers corresponding to Starbucks. b. Opportunities
Having a strong relationship along with your Growers offers two issues: information about the coffee market and an inside observe on a grower’s crop. Being knowledgeable additionally with the Coffee Consumption Trends, the company can consider new strategy to keep their enterprise on track. 2. Internal Environment
Every company has their very own weaknesses that come from the within. In the a half of Aloha Products, its division is considered one of the causes of its weak point.
Like within the Purchasing group which was largely autonomous and their mismanagement of the company’s assets.
V. Alternative Courses of Action
1. The company must restructure the Purchase unit as an operational arm of all its crops. 2. The company must build an excellent relationship with the growers as a substitute of the brokers.
VI. Analysis Courses of Action
1. Pros- By this, there shall be coordination between Purchasing Unit and Manufacturing Department. Cons- There might be an additional work load. 2. Pros- It is less expensive if you order directly to the growers. Cons- Growers wish to cope with consumers they belief and vice versa. Hence, growers are most likely to favor those relatively giant firms.
Given the unstable nature of the espresso market, having a central buying unit is necessary. Expecting every plant to deal with the espresso purchases will add pointless overhead cost to the company. For suggestion, Purchase Department should take the necessities from each of its crops and execute them. This gives Aloha Products to attain price savings from bulk purchasing.