Final answer:
For basic products with steady demand, Wal-Mart may use direct sourcing, while for specialized products like waterproof ski jackets, they may opt for full package sourcing. Direct sourcing is efficient for standardized items, whereas full package is ideal for complex products. Wal-Mart's sourcing decisions reflect its focus on cost, quality, and maintaining competitive advantage.
"the correct option is approximately option B"
Step-by-step explanation:
For basic products with steady and predictable demand, sourcing managers at Wal-Mart may consider a direct sourcing option, which allows for efficiency and predictability in supply chain management. Conversely, for products that require special knowledge and skills to produce, such as waterproof ski jackets, Wal-Mart may consider a full package sourcing option. This approach allows them to collaborate with suppliers who have specialized capabilities, ensuring product quality and innovation.
Direct sourcing is advantageous for standardized products because it contributes to the efficiency and calculability of production, leading to cost savings that large retailers like Wal-Mart can pass on to consumers. The full package sourcing option is suited for products that involve complex designs and technology, where the supplier is responsible for the entire process from sourcing materials to delivering the final product.
Wal-Mart's business model emphasizes undercutting competitors on price by leveraging economies of scale, but this can have consequences such as affecting local economies and reducing product variety. However, firms like Wal-Mart determine their sourcing strategies based on the need to balance cost, quality, and production capabilities so that they can remain competitive in the retail sector.