Factors that affect the buying in of raw materials is an important question that may crop up in Higher Business Management and National 5 Business Management.
The factors that need to be taken into consideration are:
Quantity – does the supplier have the facilities to supply the firm with the correct amount needed?
Quality – what standard is the raw materials being bought in? I always think of GIGO (Garbage In, Garbage Out).
Cost – What price will the supplier charge? This will have a knock-on effect on the companies own profits.
Reliability – do the suppliers deliver on time and in the right quantities?
Lead times – how long does it take for the goods or raw materials to be delivered?
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