Consider the following two ways TSE could purchase the raw materials for its factories. Which way should TSE use? Justify your answer. - Head office in country P continues to purchase the raw materials for all TSE factories - TSE's factory managers in each country purchase raw materials locally Head office in country $$\(P\)$$ continues to purchase the raw materials for all TSE factories: . . . . . . . TSE's factory managers in each country purchase raw materials locally: . . . . . . . Recommendation: . . . . . . .

Justification could include:
- All raw materials purchased by head office is the best way as this will allow considerable cost savings due to purchasing economies of scale and lower unit costs. This will allow TSE to keep prices low and to be more competitive with other similar sport equipment manufacturers. Whereas it may be more difficult to ensure the quality of raw materials if they are purchased by the factory managers which could damage the brand reputation.
- Each factory manager purchasing their own raw materials is the best way to choose because each manager can meet the local demand for specific sports, and this will attract more customers leading to higher revenue.