Final answer:
The make-or-buy decision for Speedy Wheels involves analyzing whether to produce a component in-house or outsource it by considering costs, core competencies, quality, and supply chain effectiveness. It is a cost-benefit analysis critical to the operational and competitive aspect of the manufacturing business.
Step-by-step explanation:
A make-or-buy decision that Speedy Wheels, a motorized skateboard manufacturing company, will have to make involves deciding whether to manufacture a component part in-house or to purchase it from an external supplier. This decision requires a careful cost-benefit analysis that compares the costs of in-house production, including labor, materials, and overhead, with the cost of purchasing the part externally. The decision will also consider factors such as quality control, lead times, production capacity, and the potential for intellectual property or proprietary technology concerns.
To make a well-informed decision, Speedy Wheels would typically analyze its core competencies—what it does best compared to competitors—and consider whether the part in question is critical to their competitive advantage. Additionally, the company will likely evaluate the reliability and performance of potential suppliers, as well as the flexibility that outsourcing may provide in responding to fluctuating demand.
In summary, a make-or-buy decision is a strategic choice that can significantly impact a company's operations and competitive standing within its industry. For Speedy Wheels, such a decision could impact the efficiency, cost-effectiveness, and quality of their motorized skateboards.