Answer:
1 - The problem here is that the existing supplier is not able to supply the required material due to supply constraints. In this condition, there are two options available to the Clayton, as follows
a) End relations with Sarah and look for other suppliers. Search for other supplier who can supply material within the desired duration. This can be done through the process of competitive bidding
b) Continue relationship with the existing supplier and search for other suppliers for serving the immediate demand of the fabric.
2- The trade-off for each decision are as follows:
Option 1
a) More options to chose suppliers
b) Potential of choosing a low cost supplier for long term relationships
However, it is a time consuming process and will affect the existing relationship with the current fabric supplier. New supplier carries more risk in comparison to existing suppliers.
Option 2
a) it will maintain the relationship with existing supplier of fabric, as well as fulfill the current demand
b) Work will run smoothly and will strengthen long term relationship with the existing supplier.
However, managing two suppliers will be difficult and time consuming. Since, the quantity will get divided, there will be lesser quantity discounts.
3 - Clayton first ask to Sarah that some other supplier like her that he can found in a day or two, Supply of fabric is essential to complete the order in over the month. He must have to get outside and find another supplier of fabric until Sarah can find fo him.
4 - This case give us a lesson to have adequate supply and to have some optional reliable source to depend on that they could satisfy the urgent need of the raw material and also in-house production that could indeed reduce reliability over the supplier which can be risky in some situation like this.
Explanation:
