Trojan Technologies Essay

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Trojan Technologies Joyce Guo is the Senior Buyer for Trojan Technologies which manufactures and sells water treatment systems world wide from their London, Ontario Canada facility. Joyce’s manager Randy Haill has tasked her with the strategic supply chain issue of Global Sourcing. In an effort to help find potential opportunities for lower costs with regards to their components or parts. Currently the majority of their parts are sourced in North America with a few sourced internationally under strategic sourcing agreements. Joyce has identified a list of parts that would be candidates for her global sourcing initiatives to China to reduce costs. Of the twenty-two parts that are potential candidates for global sourcing, eleven are already part of a strategic sourcing agreement and eleven are sourced throughout North America. She has provided us with the current price per piece but has not provided us with a price from any potential supplier from China. There are also additional costs that Joyce has identified that will be above what they currently pay for transportation, holding costs , taxes, administration fees and duties. If they source from China these charges include: • 8% duty for products from China • 25% increase in inventories, this would increase Trojans inventory holding. I estimate this to be a 5% increase. • 5% transportation premium • Additional administration and travel costs estimated at 5% as the company already maintains an international purchasing office in China The following is an analysis of a potential cost comparison with these additional charges. |North American suppliers |Global Sourcing - China | |Part |Piece price($)

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