Gloria’s business is doing well. She has been manufacturing widgets in the United States, however, the costs for the raw materials have increased 200% with her current supplier. She has found a new U.S. supplier—Greenleaf Manufacturing—that is willing to negotiate costs with her. Gloria has scheduled an appointment with its CEO, Richard Franklin. She is also considering manufacturing her widgets overseas. She traveled to China and met with Jun Chin, who is interested in the contract. She also went to Brazil and met with Mateo Bonilla, who also discussed production with her. Currently, Gloria has been selling approximately 12,000,000 widgets per year, but she recently got a purchase order from a large retailer for 8,000,000 widgets and a guarantee for a minimum of 13,000,000 widgets over the next 24 months. The purchase order states that continued business is dependent on paying no more than $7.34 per widget. Gloria’s current cost to manufacture widgets is $6.22 and she has been selling them for $9.18. Doing business with this large retailer will take Gloria’s business to the next level, but she has to get her costs down.
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