EVALUATING THE EFFICIENCY OF GLOBAL SOURCING METHODS AT IKEA CYPRUS
ABSTRACT The strategy of IKEA Cyprus, as in the rest of the world, is to have the Cost Leadership in the industry. This year they had the opportunity to change their sourcing strategy in order to reduce their logistics cost even more. The change was focused in two sourcing methods a) Direct sourcin...
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| Format: | Dissertation (University of Nottingham only) |
| Language: | English |
| Published: |
2008
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| Online Access: | https://eprints.nottingham.ac.uk/21991/ |
| Summary: | ABSTRACT
The strategy of IKEA Cyprus, as in the rest of the world, is to have the Cost Leadership in the industry. This year they had the opportunity to change their sourcing strategy in order to reduce their logistics cost even more. The change was focused in two sourcing methods a) Direct sourcing from Suppliers or their consolidation centers in their country b) Through a consolidation center in Athens that did all the sourcing activities from suppliers and could supply all of IKEA�¢����s SKUs at a higher price and a fixed 2 weeks lead time. The basic question that we had to answer was �¢����Which SKU�¢����s must come through direct sourcing and which SKU�¢����s must come through Athens.�¢����
The dissertation objective is to analyze the current supply set up of the IKEA store in Cyprus and the efficiency of the two sourcing methods and how they can be improved. Analyze the characteristics of IKEA�¢����s SKUs in matters of operational requirements, demand pattern and profitability. Also try to find how and what changes in the distribution processes will help to reduce the overall distribution cost while maintaining the stores service level. The dissertation output would be a costing decision tool that can be used every year to evaluate the distribution set up of the Cyprus store and help in the decision making. |
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