Indeoendent Institute of Education - Assessment 201 1

OUESTION 3

Explain the three (3) levels of decision-making of supply chain management with relevant

examples.

(Refer to pp. ll - 12 in Strydom et al (2"d edition) - Distribution Management.

Altocate 7 mark for the strategic level, 7 mark for the operational level and 7

mark for the tacticat level. Furthermore, allocate marks to a maximum of another

3 marks per explanation of each level.)

IMark Allocation: 1O]

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4.I With the ability to order platters online with Checkers, what do you think the

distribution channel would most likelv look like? (4)

(Marker to use discretion in awarding marks, The following is an example

answer, Please refer to pages 30-34 in Strydom et al,, 2OO9, Distribution

Management, Van Schailg Pta.)

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4.2

Independent Institute of Education - Assessment

Itwou|dmost|ikelystartfromdecentra|isedsources(c|osestfarms/suppliers) (l) sending fresh ingredients to drop-off points/ warehouses (1)

and the food would most likely already be at the store when the order is

placed. (1) oncean online order is placed' the admin person at Checkers

on|inewi||eitherca||theorderinore-mailtheorderthroughoncepaymenthas been received. (I)

AssumingthatyouaretheMarketingManagerforCheckers,whatmeasureswou|dyou put into place to manage customer expectation? (6)

(Markertousediscretioninawardingmarks'Thefollowingisanexampleanswer.Awardamaximumof6marks.PleaserefertopagesT6g-776inStrydom et al', 2Oo+ Distribution Management' Van Schaik' Pta')

Making sure that it's easy to register on the web site; (l')

Making sure that the web site is functional at all times; (l)

MakingsurethatthereisaCheckerswiththeserviceinre|ative|yc|oseproximity anywhere in South Africa; (1)

InventorY availabilitY; (l)Order lead time; (l)Verifying the order once it has been taken via e-mail or smsi (1)

Makingsurethatthestoreconfirmsthattheorderhasbeenreceived;(1)Makingsurethatthecustomerisinformedviate|ephoneorsmswhentheirorder is going to be late' (l)

4.3 Explain the JIT principle and why it is so relevant to these platters? (5)

(Pleaserefertopageg&73inStrydometal"2OO9'DistributionManagementlVan Schaik, Pta.)

TheJust.in-Time(.1)conceptpromotestheideathattherightproductsarrive in the right quantities just when they are required ' (2) Because these

platters are made up of food, and food being a perishable product' (l)

Checkerswou|dbeabletominimisepotentia|waste(J)iftheyare,operating a functional JIT system'

4.4 Define the distribution structure relevant to checkers as a store and give a reason

whyitistnemost|ike|ydistributionstructure.A|somentionwhythisdistributionstructure would have been selected against checkers'particular brand strategy? (5)

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Independent Institute of Education - Assessment 201 1

(please refer to page 60 in strydom et al,' 2oo9, Distribution Management' van

Schaik, Pta,)

Intensive distribution (2,) invotves placement of products (usually

convenience products) in as many locations as possible by using the

optimum number of intermediaries' (1) It is generally an appropriate

objectivewhenacost|eadershipstrategy(1)isemp|oyedasthefirm'scompetitive position and the key features of the target market segment is

on purchasing convenience at a low price. checkers mainly sell convenience

goodsandhaveaneveryday|owprice/cost|eadershipstrategystrategically. There are vast amounts of stores employed nationwide. (J)

4.5 What do you make of the Checkers "Better and Better" positioning relevant to

introducing a fine selection of wines, cheeses and meats? Q)

checkers is moving into a space, cost and quality wise, between shoprite

and pick n Pay. (and potentially woolies foods) or one could argue' on par

with Pick n Pay' between Shoprite and Woolworths' (2)

4.6 What effect do you think the "Better and Better" positioning has had on the

construction and management of Checkers' value chain?

(Marker to use discretion in awarding marks. The following is an example

answef. Award a maximum of 3 marks. Please refer to pages 67' 797-794 in

Strydom et al., 2OOg, Distribution Management, Van Schaik' Pta')

Because the campaign or positioning set certain expectations' customers

would then like to see good quality meats' cheeses and wines - as well as a

variety of these products (l). This means that products had to be sourced

from more suppliers, and more intermediaries would enter the value chain -even imported products in some circumstances with its own sets of laws

and regulatory channels to follow (1). To select the right store for the right

type of product could be quite a daunting task, This decision is based on the

demographics of each store (1). Product innovation i.e. ready prepared

meats would also lead to more operational organisation in ensuring that the

end product has the desired outcome (J), A positive is certainly the fact that

an atready existing supply chain would have helped financially and would

have also helped with potential teething problems initially - relationships

with existing suppliers now providing more of their product would also have

cost saving results. (J)

IMark Allocation: 25]

END OF PAPER

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