PQR, Inc.'s CEO has directed supply management to provide wing flap inventory at the lowest cost while meeting the goal of multinational market expansion. The options given are:
Option A suggests purchasing refurbished parts from a non-certified repair shop with an extended warranty.
While this is the lowest cost option, using non-certified parts can compromise quality and regulatory compliance, which is critical in the aerospace industry.
Option B involves manufacturing the parts internally, which is the most expensive option at $11,000 per part.
Option D proposes purchasing materials from an outside manufacturer at $10,000 per part, which is still more expensive than repairing internally.
Option C, acquiring resale parts and repairing them internally, costs $9,000 per part. This option ensures the parts meet PQR's quality standards and regulatory requirements, as PQR can control the repair process. It balances cost efficiency and quality, making it the best course of action to meet the CEO's directive.
References:
* Cost-benefit analysis in supply chain management.
* Aerospace industry standards and regulations on part certification.