Question: Super Sized Cycles specializes in making larger bicycles for overweight riders. Thanks to Internet sales, the company has increased sales every year. However, profits have been razor thin. The problem is that the company currently obtains parts from U.S. - based companies. Though this allows for individualized customer service, it is also expensive, as each bike roughly costs $1,250 to produce. If, however, Super Sized Cycles were to source materials from Taiwan, it could pay just $400 to $500 for each bike.
1- What are the advantages of working with U.S. suppliers? What are the disadvantages?
2- What are the advantages of working with foreign suppliers? What are the disadvantages?
3- What would be the best option for insuring the continued success of Super Sized Cycles?