1. Alpha Mineral Prospecting and Exploratory Drilling Co. Ltd.

(A case in wrong
specification, packing and dispatch instruction)
If an order is made on F.O.R destination basis, then the goods mentioned in the invoice will be
transmitted from the supplier to the client without any transportation charges. Sometimes, it is
also called Free on Road (Rail, Board or Ship). In the case of Alpha Mineral Prospecting and
Exploratory drilling Co. the supplier was supposed to bear the transportation charges.
If the company and the supplier had fought a legal case then the company would have won
because there was a clear breach of contract on the part of supplier. The company had clearly
stated the kind of gunny bags they required for packaging and had even attached a sample
piece of the kind of material they needed. But the suppliers did not conform to the sample piece
and had provided a packaging material which could not hold the fine powder intact and as a
result there was a huge amount of loss. The term F.O.R destination is a part and parcel of the
purchase contract which clarifies whether the supplier or the receiver will bear the transportation
cost. Descriptive language in the contract is sufficient to convey an accurate description of the
materials ordered for. In this case the company had provided a detailed description of the kind
of material they required and had even sent a sample piece of the kind of material they required
for the packaging. There was sufficient details provided for an accurate description of the
material required.
No, the ground that they were packed in gunny of standard sized cement bags with wider
meshes as per the sample would not have been overruled by the requirements of suitability over
the necessity of correspondence with the sample. The material ordered was of special nature
and all the necessary dispatch instruction had been provided by the company as it was not
possible to carry Bentonite powder in the normal cement gunny bags.

2. National Seed Research and Development Centre (A case in make or buy decision)
The material manager of NSRDC should not take the risk of making the chairs in their own
carpentry workshop and instead should buy them from outside manufacturers on order. Since
time is the most essential element here the material manager should not worry about the cost
factor. As stated to him earlier the deadline is fixed and with the symposium being an event of
high importance for the organization, the job has to be completed before the target date.
As for the decision to make chairs partly in the carpentry workshop and partly buy chairs from
one or both the suppliers is concerned, it would be preferable to avoid such an arrangement and
buy all the chairs from the suppliers. Since the cost of procuring chairs and ordering identical
chairs is of equal importance, it should be taken care that the same type of chair is arranged for
everyone and there should not be any scope for complaint about preferential treatment being
meted out to a select few. As 500 delegates from all over the country and other tropical
countries made it to the symposium, everyone should be treated at par.