MyBad Boards designs and manufactures high performance skateboards and related gear used in extreme sports. Their products are sold widely in North America, Europe, Australia, and East Asia, with sales of more than $20 million last year. They currently manufacture all of their products in the United States, using raw materials and components sourced domestically. However, after experiencing rapid growth during the past five years, the company is considering the alternative of purchasing some or all of its materials from international suppliers.
1. Which is not a reason that MyBad Boards might choose to source globally?
A. Foreign suppliers offer higher quality products.
B. The potential for highly competitive local markets.
C. Foreign suppliers offer better designs.
D. Products the company required are not available domestically.
E. The potential to obtain lower prices.
2. Problems that could arise if MyBad Boards decided to source globally include all of the following except which?
A. MyBad Boards might face costs due to poor integration with the company's overall business system.
B. MyBad Boards might face costs due to exchange rate fluctuations.
C. MyBad Boards might have troublemaintaining security of proprietary corporate information.
D. MyBad Boards might find it difficult to accurately assess potential suppliers.
E. MyBad Boards might avoid costs related to letters of credit.