Describe two ways in which logistics has an important economic impact.

Why is transportation important to a firm's supply chain operations?

A paint company has three sources for buying bright red pigment for its paints: Vietnam, Taiwan, and Thailand. Unfortunately, the pigment is made from a bush whose annual growth is heavily dependent upon the amount of rainfall during the growing season. The following tables show probabilities and prices for wet, dry, and normal growing seasons. Probabilities Wet Dry Normal Vietnam 0.5 0.2 Taiwan 0.6 0.3 Thailand 0.4 0.4 Price/Pound ($) Vietnam 0.96 1.11 Taiwan 0.86 1.25 Wet Dry Normal Thailand 0.92 1.19 0.3 What country shoul the company select? Thailand Taiwan Vietnam 0.1 0.2 1.05 0.99 1.06 What is the expected value (price) associated with it?

Discuss the impact that current transportation issues may have on supply managers.