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The local Hospital purchasing manager

Question # 00349765
Subject: Art
Due on: 07/30/2016
Posted On: 07/30/2016 11:19 AM

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The local Hospital purchasing manager was contacted by new supplier, who offered a quantity discount for disposable syringes. The order cost for the item is $80 per order and holding cost is 25 % of average inventory value on an annual basis. Annual demand is 40,000 boxes at a constant rate (no seasonality). The Hospital currently pays $80 per box of for syringes. However, the new supplier offered a $4-per-box discount if the hospital would order a minimum of 2,000 boxes at a time. Should the hospital take advantage of this offer? Show a comparative analysis of all costs in the two alternatives; with discount and without discount); Show detail of your work.

Tags manager purchasing hospital local hospital discount order annual syringes boxes offered supplier cost 0 4perbox currently pays time minimum offer analysis costs work comparative alternatives seasonalitythe advantage basis disposable item quantity contacted purchasing