GCSE 9-1 business studies - 2.3.2 working with suppliers

Running the business with so little stock that new supplies have to arrive just before existing supplies run out

• Bar gate stock graph

• Just in case

• Just in time

• Stock levels

The minimum stock level held at all times to avoid running out completely

• Re-order quantity

• Lead time

• Buffer stock

• Maximum stock level

Items held by a business for use or for sale

• Lead time

• Stock

• Warehouse

• Just in time

What is an advantage of ‘just In time’?

• Less of the business’s capital is tied up in stocks.

• There is a greater risk of running out of stock.

• Buying smaller quantities more often means losing out on bulk buying discounts.

• It can lead to higher levels of quality.

What is procurement?

• Knowing how to get the right supplies quickly

• Obtaining the right supplies from the supplier

• Ensuring that the right supplies will be ordered and delivered on time

• Building a business relationship with suppliers

What is logistics?

• Ensuring the right supplies will be ordered and delivered on time

• Knowing how to get the right supplies quickly

• Building a business relationship with suppliers

• Obtaining the right supplies from the right supplier

What does trust mean?

• Improving quality through the use of training

• Building a business relationship with suppliers

• Obtaining the right supplies from the right supplier

• Developing motivational strategies to improve productivity

The level of stock that triggers the business reordering new supplies

• Buffer stocks

• Re-order level

• Re-order quantity

• Lead time