Asked by Jordan Cornelius on Jul 17, 2024
Verified
The supply chain profit is higher if each stage of the supply chain independently makes its pricing decisions with the objective of maximizing its own profit.
Supply Chain Profit
The total profit achieved by all members of a supply chain, from raw material suppliers to end retailers, through the production and sale of goods.
Pricing Decisions
The process of determining the price at which a company's products or services will be offered to the market, affecting demand, sales, and profitability.
Maximizing Profit
The process of implementing strategies and making decisions that lead to the highest possible profit margin.
- Learn about the significance of employing price variability and incentives for bulk purchases in the pursuit of higher earnings and better coordination of supply chain processes.
Verified Answer
TM
Thristan MercadoJul 17, 2024
Final Answer :
False
Explanation :
In a supply chain, each stage's pricing decision can impact the other stages, leading to suboptimal outcomes for the entire supply chain. It is important to coordinate pricing decisions among different stages to achieve the overall supply chain profit maximization. This concept is known as supply chain coordination.
Learning Objectives
- Learn about the significance of employing price variability and incentives for bulk purchases in the pursuit of higher earnings and better coordination of supply chain processes.