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De Havilland

In: Business and Management

Submitted By samlui
Words 1980
Pages 8
Executive Summary
De Havilland is an Aircraft company founded in 1928. In March of 1992 De Havilland was purchased by Bombardier Inc (51%) and the government of Ontario (49%). Due to high manufacturing cost, De Havilland is trying to implement a new cost reduction strategy by partnering with a smaller base of suppliers and utilizing long-term contracts.
De Havilland sent out RFQs to nine suppliers and the Financial Analyst, Kim Tomar was responsible to evaluate and recommend the candidates. When comparing price, one of the suppliers, Marton Enterprises had pricing that was less expensive by $2, 061,180 compared to the current provider, Dollard Plastics. De Havilland had approached Dollard and asked for a 25% discount; however, they disagreed and didn’t provide any counter offer. De Havilland was hesitant to switch to Marton as the company did not provide financial information, and was in question as to whether they would be able to support all of De Havilland’s inventory needs. Furthermore, the wide range of low pricing from suppliers was in question as there could have been misinterpretation of the terms and agreement for the bid. De Havilland will need to clarify that Marton is able to perform the duties on a long-term basis and is able to provide and perform up to the service levels to meet standards. To mitigate risk, it would be recommended that De Havilland acquire Dollard Plastics for one year while awarding Marton the majority of the production of the flap shrouds and bay doors. De Havilland will monitor Marton using KPI’s on a quarterly basis and discuss any changes if required.

Issues Identification
Bought by Boeing in 1986 and sold in 1992 to Bombardier Inc. and the Ontario government, De Havilland has established itself as a major player in the Canadian aircraft manufacturing industry. To continue growth and success, De…...

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