Endurance is able to resolve the supplier-induced quality issue by looking at many possible solutions. There are pros and cons to each option. If all options are set to neutral then option 3 is the best. It will cost less to acquire the business, which will have a minimal impact on its sales. Options 1 and 2 have significant associated costs and the possibility of consumer complaints rising. Options 1 and 2 will have significantly higher replacement costs, while option 3 should be much cheaper.
Endurance’s focus on sensor production will ensure that the company hires only highly qualified personnel. The failure rate for the sensors will be lower, which means that customers won’t have to complain as often. The third option has a lower failure rate than the export sensors. The option is viable for the business but the expected capital expenditure makes it more attractive than other options, as the company won’t incur any capital expenses.
Option 1 is not considered. Although the company may be unable to deliver replacement components, it is possible. However, dissatisfied clients continue to give negative feedback. Because the sensors are only good for one year, the company must pay extra expenses. This can impact the company’s profit margin and revenue. This will require the hiring of a customer service representative. An organization already has customer service staff who are able to effectively delegate responsibilities. This may not solve the company’s problems. This is also not sustainable.
Option 2 has a negative answer. Reason for this negative answer? The company stated that import costs are high. Going back to the previous company who provided sensors to them would increase import costs and harm the company’s revenue. Import prices are expected to rise over the coming years due to the coronavirus epidemic. Ketahanan sensors are inexpensive, which means that the company could communicate any concerns it has to Ketahanan in order to increase the quality and reliability of the sensors. This is one way to address the problems within this company’s supply chains.