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Case
-
Reference no. 621-0014-1
New product
Authors:
Tanja Mlinar (IESEG School of Management); David Newlands (IESEG School of Management)
Published in:
2021
Version:
1-Mar-2021
Revision date:
21-Apr-2021
Length:
8 pages
Data source:
Generalised experience

Abstract

'First Smile' is a retailer of a large variety of products for children including clothes, shoes, toys, furniture, strollers and baby care products. The company has recently opened a new regional warehouse for e-commerce sales located in Paris. Among many baby care products, the company has decided to start selling biodegradable diapers called 'Breathy'. They are produced by the leading diaper brand 'Mikae', a well-known US-based company that produces healthcare products, baby care products, cosmetics, fragrances, and household cleaning products. Breathy diapers are safe and effective, free of harmful chemicals and all known allergens. They are available in sizes 0 to 5 based on baby weight, and each pack contains 44 diapers of for each size variant. Over the longer-term, gross demand for diapers is consistent and seldom are there spikes or significant downturns. Month to month, the number of diapers that their parents purchase from the First Smile's stores remain roughly the same for each size. At First Smile, predicting demand for diapers is mainly based on tracking birth rates. First Smile has to evaluate offers from four potential cash and carry type vendors of Breathy diapers including an official importer of Mikae products and large distributors of baby diapers located in UK, Belgium, and France. These offers differ in terms of the purchasing price, discounts and other conveniences, and delivery constraints. First Smile’s management would like to select the right supplier of diapers for the company's e-commerce store and determine the number of packs to order from the supplier to minimize its costs.

Teaching and learning

This item is suitable for postgraduate and executive education courses.

Topics

Supplier selection; e-Commerce; Inventory management; Quantity discounts

Setting

Geographical setting

Region:
Europe
Country:
France
Locations:
Paris, France; Lesquin, France; Maidstone, UK; Antwerp, Belgium

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