A disadvantage of the "few suppliers" sourcing strategy is: Question 20 options: A) the risk of not being ready for technological change. B) the lack of cost savings for customers and suppliers. C) possible violations of the Sherman Antitrust Act. D) the high cost of changing partners. E) the suppliers are less likely to understand the broad objectives of the procuring firm and the end customer.

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Business

Meadow Page

11 January, 21:13

A disadvantage of the "few suppliers" sourcing strategy is: Question 20 options: A) the risk of not being ready for technological change. B) the lack of cost savings for customers and suppliers. C) possible violations of the Sherman Antitrust Act. D) the high cost of changing partners. E) the suppliers are less likely to understand the broad objectives of the procuring firm and the end customer.

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Roderick Shaw · Answer 1

Answer: D) the high cost of changing partners.

Explanation: The high cost of changing partners is often a disadvantage of the "few suppliers" sourcing strategy. The few suppliers sourcing strategy is one wherein companies rely on few suppliers in order to lower transaction and production costs, to keep materials and processes tightly regulated among others. It offers some advantages, some of which includes that suppliers are more likely to understand the broad objectives of the end customer; there is creation of value by allowing suppliers to have economies of scale and the suppliers are often willing to provide technological expertise.