P320 Commodity Paper

Submitted By rlduncan
Words: 2345
Pages: 10

Supply Chain Management: P320
David Gray, Paige Recker, Rachel Duncan, Madison Wathen, Rachel Hetrick
Harley Davidson
4/24/2013
Supply Chain Management: P320
David Gray, Paige Recker, Rachel Duncan, Madison Wathen, Rachel Hetrick
Harley Davidson
4/24/2013
Leather for Purchase Agreement
Leather for Purchase Agreement

Product Information: The intended use for the leather that Harley Davidson (HD) purchases is to make customized leather jackets for both men and women. For this report, we are using Harley Davidson as the point of contact and focusing on the leather that is provided by Schott, DA ORG and Choice Leather Outfits. When Harley Davidson receives the leather from its suppliers, the logo is embedded into the product at the supplier warehouse. Harley has given permission for the suppliers to use its brand logo provided that they follow the Harley Davidson code of conduct. When Harley Davidson requests a jacket from its suppliers, the suppliers must provide specifications for the leather in order for Harley Davidson to know exactly what it is getting. The specifications listed are to be met by every supplier, regardless of relationship or dedication to the Harley brand. The specifications for Harley Davidson are as follows: (Supplier Code of Conduct). * Confidentiality * Accurate statements * Email, internet, voicemail usage * Health and safety * Use of the Harley Davidson trademarks * Media communications * The purchase of gifts or entertainment by suppliers for Harley Davidson employees * Improper payments * Conflict of interest * Environmental responsibilities * Being a good corporate citizen
Once the jackets are ordered, the specifications are kept on file for future orders so Harley Davidson would then only have to refer to a material/shipper number. There are four classifications of leather: pure aniline, semi aniline, corrected grain, and suede split. Leather can be made from the skin of virtually any animal; however, most leather products come from just four animals—cow, sheep, pig, and goat (leatherresource.com). All skins and hides go through a process called tanning, which is the process to convert the raw hide into leather, through chemical treatment. When dealing with grade of leather, the scales vary from a one to five or from A to E, depending on what the manufacture decides. The farmers that deal with the animals need to be aware of the type of feed they are using on their animals because that will ultimately affect how the skins and hides look when the animal(s) are slaughtered and sold (leatherresource.com).
The current manufacturing of leather is outsourced to companies throughout parts of Asia and Southeastern Asia. Among the countries in Asia and Southeastern Asia, China is the leading manufacturer of leather. The type of leather referred to in this paper is designed specifically for motorcycle jackets. Many of the companies that supply leather for Harley Davidson import their leather from outside the United States due to the lower cost of making and dying it. However at one point in time, Harley Davidson leather was only produced in the U.S. by the Schott Bros out of New York City. Schott was the first manufacturer and distributor for Harley Davidson. Schott has continued to supply leather products for the brand. However, Schott now outsources its leather through two main vendors: * Zhejang Native Produce & animal * Sofich (Xiamen) Industrial
Both of these companies are located in China. Harley Davidson also uses D A ORG—for which the suppliers used were not available—and Choice Leather Outfits, which manufactures leather in its own factory, Complete Leather Garments Manufacturing Unit. The company is located in Karachi, Pakistan (About Us). The supply of leather products can be affected by a number of things in the world. Some examples of environmental events that have an impact on the supply of leather include