GM typically solicits bids from global suppliers to produce a component and awards a 1-year contract to the supplier that submits the lowest bid. At the end of the year, a contract is once again put out for bid, and once again the lowest cost supplier is most likely to win the bid. Which of the following is GM using?
A) Strategic outsourcing
B) Competitive bidding
C) Strategic bidding
D) Long-term alliance
E) Hostage taking

Question

Quizplus · Accepted Answer

GM is using competitive bidding, where they are soliciting bids from global suppliers and awarding the contract to the supplier with the lowest bid. This process is repeated every year, indicating that they are not entering into a long-term alliance or strategic outsourcing agreement. Additionally, there is no indication of strategic bidding or hostage taking in this scenario.

GM Typically Solicits Bids from Global Suppliers to Produce a Component