A firm produces goods that are subject to frequent customer design changes. The products are sold to a few distributors who sell to a large number of retailers. In this situation, which of the following represents the best approach for which the firm should produce those goods?
Given the frequent customer design changes, it is essential for the firm to remain flexible and responsive to actual market demand. A pull strategy based on retailer sales allows the firm to produce goods only when there is confirmed demand from retailers, ensuring that the products align closely with customer preferences and reducing the risk of overproduction or obsolescence. This approach not only minimizes waste but also enhances customer satisfaction by providing exactly what the market desires.
I go with B Pull based on retailers
Why it isn’t D ?
"subject to frequent customer design changes" it is PUSH not PULL
In this situation, where there are frequent customer design changes, it would be best for the firm to use a pull strategy based on retailer sales. This means that the firm should produce goods based on actual demand from retailers, rather than replenishing distributors based on forecasts or push strategies
The best approach for a firm producing goods with frequent customer design changes and selling to a few distributors who then sell to many retailers is D. Using a pull strategy to replenish the distributors. A pull strategy allows the firm to respond more flexibly to actual demand and design changes, ensuring that production aligns closely with current market needs A pull system requires a signal to drive replenishment. In this case, the signal would be good leaving the DC
D is correct ans