Question

What issues would sab and central face in the proposed new approach?

Answer 1

Several l issues could inevitably arise with the establishment of the venture. First andforemost, both companies should work closely with Wegman’s in how business would beconducted across all elements of the newly-constructed supply chain to achieve desiredoutcomes. Communication is essential in order to create more value to customers, reduceinventory costs, prevent backlogs, and avoid bullwhip effects. Moreover, the three major playersin this supply chain should work on the method they would want to share information up anddown the chain. Information systems should reflect real-time flow of products and information inorder to reduce uncertainty and complexity. Unsynchronized operations could lead to highercosts (transportation, inventory, warehousing,..) and consequently lower profit margins andcompany value.Another issue would be the management structure of the project.They wouldneed to decide which company would be the true lead, having two leads creates a redundantposition and could lead to conflicting interests. .Then both companies would fight about who is right and who is wrong, tearing the venture apart.