The Peanutty Food & Co. Supply Chain 1. What actions can Peanutty’s managers take to ensure the supply of raw materials for its operations, while reducing the risk of stock outs or high production costs?

In order to ensure the supply of raw materials for its operations and reduce the risk of stock outs Peanutty can use a just in time method. The just in time method is an inventory method where companies only receive goods when they need them. In order to do this Peanutty would have to make sure they knew exactly when the needed the products in and if they needed less or more in a given month. By using the just in time method they will ensure they have exactly what the need reducing the cost of storing the goods which will reduce the production costs.

2. What activities could be developed by Peanutty to reduce or manage the power of its suppliers and customers to minimize risk and maximize profitability?

Activities that could be developed by Peanutty to reduce the power of its customers Peanutty needs to go out and find other suppliers. Even though from a logistics point of view it makes sense to use the local employees for its supply of peanuts, Peanutty needs to reach out to suppliers in other countries like India and see if bringing in peanuts from those countries would ultimately be cheaper than purchasing them from the local collectives in Brazil. If it is cheaper for Peanutty to buy elsewhere it would give them some leverage to go back to the collectives in their country and ask them to lower prices. In order to reduce the power of its customers Peanutty should use its R&D department to come up with new and innovative uses for peanuts that only their company can produce. Being the only company that can sell this product will give the company more leverage with the larger companies that they are already selling their peanuts to. Additionally,