Case 1: Cj Industries and Heavey Pumps
Student number: 14210009
Word Count: 1719 CJ Industries has an opportunity to provide Great Lakes Pleasure Boats with key engine components for their luxury line of pleasure boats. They earned this through the development of a strong buyer-supplier relationship with Great Lakes and this 5-year, $10 million annual contract offers them the chance to have an extended relationship if they can satisfy Great Lakes’ needs. The opportunity is critical for the successful future of CJI and the main goal of the company should be to completely satisfy the requirements of the contract with Great Lakes, and secure their future business with Great Lakes. While they do …show more content…
Additionally, if they do decide to expand production, will their staff be able to handle the dramatically increased demands placed upon them? This will be an important question to answer because they would most likely have to hire several new workers to handle the new demand, and it would take time to train them properly.
Should CJI continue to use Heavey to supply pumps, should they make them in-house, should they consider one of the other suppliers, or should they do some combination of these alternatives? Discuss the advantages, disadvantages, and risks of each of these alternatives.
Should they continue using Heavey?: The major reasons to stay with Heavey would be that they have developed a relationship by working together with CJI for a long time. CJI always counted on Heavey to deliver their high quality pumps on time and the relationship was so convenient that in fact CJI didn’t even consider the pumps being an issue when they signed their contract with Great Lakes. Unfortunately, since Heavey is a small local company, CJI originally ignored that Heavey would have to expand their production capabilities. It seems like a lot to ask and expect from Heavey, and since there is no formal contract between them, it seems the most likely scenario is that CJI will either discontinue doing business with Heavey, or