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Honda Essay

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The history of Honda Honda is one of the world’s largest motorcycle manufacturers and of the leaders in the automakers industry. It was founded in 1948 by Soichiro Honda and Takeo Fujisawa. It’s headquarter is in Tokyo, Japan and it serves worldwide. Honda has 492 subsidiaries and affiliates accounted under its equity. The company develops, manufactures, and markets a wide range of products such as: automobiles, motorcycles, scooters, ATV’s, electrical generators, water pumps, lawn and garden equipments, robotics, jets, jet engines, and thin-film solar cells. In 2001, Honda became the second-largest Japanese manufacturer and in 2008, it became the fourth largest automobile manufacturer in the United States. Honda’s major products are …show more content…

* Honda uses economy of scale-all purchasing done by Honda Trading America Corp. * Honda uses high technology and multipurpose machinery, and operates facilities in every major market they enter. * Honda uses strategic sourcing-maximizing the value added through their external suppliers, and they choose highest supplier in overall service not necessarily the lowest price. The company uses target pricing for the parts they purchase from suppliers. To Honda, customer satisfaction is top priority which they accomplish through suppliers competitiveness in quality, cost, delivery, development, and management. Honda gives its suppliers target costs and it reduces the cost through own ideas, technology, and improved productivity. Exhibit 1 illustrates Honda’s supply chain. Honda Just-in-time management Honda was among the pioneers in using JIT (Just-in-Time ) inventory model. Honda used this model successfully without large amounts of inventory. Honda mostly focuses on only purchasing what is guaranteed to be used and sold so that it doesn’t remain in inventory for extended time. Honda lower its month to month inventory costs in order to compete with the North American counterpart who have large amounts of inventory holdings. Honda uses JIT model because that will enable the company

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