Prep for Module 2 | Practice Operations

Vendor Showdown

Master the Total Cost of Ownership

The Cheapest Price Isn't Always the Lowest Cost

In Module 2 of Practice Operations, you'll evaluate suppliers and discover that vendor selection is more complex than comparing sticker prices. This game builds the intuition you need to succeed.

💡 The Key Insight

Total Cost of Ownership (TCO) includes everything: purchase price, quality rejects you'll have to toss, unreliable deliveries that delay production, and holding costs for inventory sitting in your warehouse.

Round
1/10
Correct
0
Streak
0

Which vendor has the LOWER Total Cost?

Consider ALL costs: purchase price, quality rejects, reliability issues, and holding costs

You need to order 500 units of Cotton
Final Score
0
out of 10

🎯 Key Takeaways for Module 2

  • Quality matters: Low quality means rejected materials and wasted money
  • Reliability matters: Late deliveries can shut down your entire production line
  • Holding costs add up: 10% per turn for raw materials sitting in inventory
  • TCO = True comparison: The vendor scorecard in Practice Operations helps you see the full picture
✓

Correct!

Vendor A - Cost Breakdown

Vendor B - Cost Breakdown