CASE LET 15-A
A PURCHASE MANAGER'S TROUBLES
Description
1 (Purchase Manager) am faced with a dilemma. I am not between the devil and the deep
ser-I am in the deep sea and the devil is waiting on the shore.
Well, the purchases in most industries are based on the production programme which
in turn is based on the sales forecast. Now firstly, the production has fallen far short of
the target and secondly, the sales forecast has failed to materialize into firm orders. The
net result is that the financial position of the company has been badly shattered. So much
so, even the bills for supplies already made are not being paid in accordance with the
terms stipulated in the purchase orders. The suppliers, having made unsuccessful attempts
with the Accounts Department, are playing hell with the purchase officers.
Supplier 'A': (Extract from a letter)
"We regret that our above bill has still not been paid even though the supplies were made
over a month ago and, as per the agreed terms, full payment was to be made within 2
weeks from the date the supplies are effected." (Neither this letter nor the numerous
subsequent reminders are replied to.)
Supplier 'A': (Extract from another letter)
"It is indeed a matter of surprise and regret that the payment against our above bill, now
overdue by over 4 months, has still not been released. We have sent countless reminders,
which have not been acknowledged. We fail to appreciate such an attitude from a firm
of your repute. We are sorry to advise that unless our payment is released immediately.
we shall have no other alternative but to discontinue all further supplies and hand over
the case to our legal section for realization of our dues together with interest accrued
thereon."
Supplier 'B': (Local firm-during a personal visit to the office)
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