Riordan has done well with managing their supplier relationships. The suppliers for the Riordan Manufacturing Company are Yin for Electric Motors, a supplier for Polymers to make plastic parts at the Riordan Facility, and a hardware supplier to provide hardware for assembling the fans. Transportation times and costs are negligible for delivery of parts because all suppliers are local. Close proximity of the suppliers also makes for an important aspect of using JIT strategies for inventory.
Even though the relationship may be good, Riordan has some concerns about its motor supplier, Yin. The relationship between the company and Yin is very skeptical. A partner within the company is involved in a secretly fraudulent business relationship, as to why they have yet to make a change from Yin to another supplier for their fan motors. The reason why they are slow about finding other sources of motors is because over in China the company has been contaminated with carbonic acid that was flushed into their water supply. Due to this situation employees have been hospitalized and few will not survive. So therefore, the company is trying to somehow solve the situation before the inspector appears. The location for this company is local to Riordan Manufacturing. On the other hand, the size of Yin is large. They have approximately 400-500 employees. Those employees are also striking for better wages, working conditions and reasonable working hours. As far as financial stability, Riordan believes the company is financially stable. But, they do pose a risk to the supply chain because of the other situations such as employee unrest from striking and potential legal issues from child labor. Either of these situations could result in that company shutting down and leaving Riordan with no alternate means of getting motors. It would seriously cripple the manufacturing process.
The relationship between Riordan and the Polymers is great and very...