Futronics Essay

Decent Essays

Futronics, Inc.
Central Stores versus Outsourcing Analysis
Devry University Online
PROJ410/Contracts and Procurement

Central Stores versus Outsourcing

Steve Hastell
Futronics, Inc.
1213 Lincoln Parkway
Lexington, Massachusetts, 02421

To offset the changing trends of fierce competition, flattened sales, and decreased profits the following analysis will provide the Corporate Cost Reduction Team members with the needed resources and recommendations to make an informed decision in the corporate overhead reduction program. Outsourcing is a hot topic in corporate America. Companies have begun to look at outsourcing of non-core materials and services to achieve substantial cost reductions …show more content…

• Delivery of products on a daily basis to either the facilities loading docks or main reception areas and transferring corporate mail and other important correspondence. • Publishing current catalogue with 500 available items twice a year. • Part of the Corporate Administrative Services, which includes food service contracting, security service, and personnel.
The major complaints were long lead times and split deliveries of office supplies. New items that would be available on the open market were not made available through Central Stores for up to five months. • Complaints over longer lead times during peak season, December for office calendars. • Specialty letterheads took three to four weeks. • Common items had a 10 to 14 day delivery time.
From the perspective of in sourcing as a viable option to control cost and reduce overhead, the following options were examined. Any one or all the below options could be implemented to help meet the required mandate. • Reduce size of current catalogue items, thus reducing facility space. • Better quality control. • Reduction of workforce (in periods of declining sales. • Better control of lead-time, transportation, and warehousing costs. • Cost considerations of current catalogue items.

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