A Johannesburg electronics importer faces repeated disruptions from its main Vietnamese supplier due to political unrest. Management is debating whether to add a second supplier in South Korea or to increase safety stock in South Africa. Based on a dual sourcing strategy, the suggestion to management would be to:

Question

Answer

Purchase larger volumes from the Vietnamese supplier to secure preferential terms.

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Negotiate a fixed exchange rate to stabilise input costs.

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Increase stockholding in Johannesburg to buffer against disruptions.

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Add a South Korean supplier to share volume with the Vietnamese supplier.

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A Johannesburg electronics importer faces repeated disruptions from its main Vie...

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