Essay on Butler

678 Words Jun 5th, 2013 3 Pages
Case Study: Butler Systems

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Butler Systems

Case 6: Brief summary of the case and main points

The case in question involves Butler Systems Company, which is in a binding contract with SDX Company. Butler Systems specializes in the manufacture of power conditioning equipment as well as environmental control systems and relies on battery supplies from SDX. Butler Systems uses HD-5 battery as the main component for emergency supply system (Benton, 2010). SDX is in a five-year contract with Butler Systems for the supply of batteries. However, SDX has not supplied adequate quantities of batteries to Butler Systems for two
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This will involve lawyers and the batteries supply contract between Butler Systems and SDX would be reviewed. This is because failing to observe and respect contractual agreements amounts to a breach of contract. SDX has breached the contract on two occasions. First is by failing to observe the normal 90-day battery supply agreement and secondly, is when SDX changed battery prices without notifying Butler Systems sixty days prior to doing so as the contract clearly states. This breach of contract has left Butler Systems unable to serve its customer base efficiently.

Upon expiry of the five-year contract, there will be a yearly renewal of the contract if one of the parties does not notify the other of its intention not to renew sixty days before the initial term expires (Benton, 2010). Therefore, I would assess the quality and improvement of service delivery by SDX and decide on contract renewal accordingly when the contract expires. If there services would not have improved, Butler Systems will search for a new supplier.

What is the buying organization’s role in selecting and qualifying potential suppliers?

A buying organization has to determine its expectations from a supplier and then make the appropriate decisions to select the most suitable. According to Beil (2009), selecting the right supplier involves the buying organization identifying, evaluating as well as

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