CJI has three options that can help them in fulfilling their contractual obligations with Great Lake. The first option is to continue working with Heavy Pumps (HP). The second option is to start producing pumps with in-house investment of $0.5 million, and the third option is to procure pumps from two other manufacturers that are located approximately 500 miles away from CJI. In case CJI continues working with HP, it has to make sure that the company will be able to supply extra number of bilge pumps. The main advantage of pursuing this option is that the company has to face minimum risk as there is no record of complaints from Great Lake regarding HPs bilge pumps.
1. Please provide at least three suggestions (alternatives) on how CJI can get the extra number of bilge pumps necessary for the contact that they have already signed with their customer. Also, state the advantages and risks of each alternative you provide. Please state which of those alternatives you would like to recommend for CJI and why.
2. How can CJI assure continued contract compliance and additional contract business from Great Lakes in the future?