Monday, May 28, 2012


Q1: Define "direct materials" and "indirect materials". List reasons for a large company having two separate departments to manage the purchasing of each.

Definition for direct materials is a complete/finish products that factory create to supplier and sell it to consumer or customer. Example for direct material such as laptops, mobile phones and etc.

Definition for indirect materials is additional products that are made for consumer/customer such as mouse for laptops, pendrive to stored documents and etc

Reasons for a large company having two separate departments to manage the purchasing of each is because  easy for company to identify the different material for each direct and indirect materials. It is also important to have separate department, one handle or manage direct materials and the other manage indirect materials. Where this also can save the cost of transporting it from overseas or somewhere far, where this method not only save the cost of transporting but also the time. Having two separate department also easy when the finish product have some problem to it where the inventor can define the error and can fix it on the spot since all the material is in one building. It is easy for the customer/consumer to shop for both direct and indirect materials where it is only located in one building. By this company also can get a huge income and loyal customer.


Direct and indirect material are different. Where direct is a finish product and indirect is an additional material that are made to add more depending on consumer or customer need. Having two separated department handling direct and indirect materials might help consumer to easily just drop by to one building instead of going few different store to find what needed. It also help the company to get loyal customer.

Q2: In about 200 words, describe the reasons a buyer might have for wanting to participate in an industry consortium marketplace instead of setting up its own private company marketplace.

The reasons a buyer might have for wanting to participate in an industry consortium marketplace is because it might help to gain more knowledge on how to gain more customer while the old consumer stay loyal. Participating with other vendors also can get more profits while saving the cost on paying the rent and paying transportation. By this participation it help both side of company learning each other strategy and both loyal customer/consumer will combine being a loyal customer to both.

The disadvantages of not participation with other company is not getting any new knowledge for other products and skill of adding another products to sell. The company have to pay full rent of it shop and transportation to send packages if necessary. The profits is less than participating with other vendor. The company not getting any new customer cause of not seeing any other new product to sell.

Q3: Which industries were the first to establish standard RFID technology? In about 100 words, state why, in your opinion, these industries were more interested in RFID tag technology than other industries.

The first industry to first establish standard RFID technology was first documented in 1940's by the British Royal Air Force to identify aircraft in World War II and was part of the refinement of radar and also in 1960's was the first considered as a tracking solution in the commercial world. The basic principle of RFID is identifying as object. The technology can be used to identify, track, sort or detect a wide variety of objects. Communication takes place between a reader or interrogator and a transponder or tag. The benefits are improving on methods of visibility such as EDI, bar coding and Advance ship notification and other benefits is reducing in theft from the store, transport or storage, and a deterrent to increasing product counterfeiting. For me it is a best way to improved security in shopping complex and any big industries that need to be fully protected from theft.


RFID is first establish in 1940's and was first consider as a tracking solution in the commercial world. The benefit to identify, track, sort and detect. When communication takes place between a reader or interrogator and a transponder or tag. It is the best way to improved security and also help the country to reduced theft.


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