Supply Management of Japan Epson Electronics Company
In Partial Fulfillment
Of the Requirements for the subject
MM 221 (7332)
Distribution Management
Submitted By:
GROUP 10
Sebumpan, Hanna Blaise
Buaya, John Phillip
Diamante, Anamarie
Margate, Lyndon
Tagana, Jeffrey.
Submitted To:
Prof. Joanna Lynn Mercado
May 10, 2025
TABLE OF CONTENTS
Background of the Establishment…………………………………………………………1
Statement of the Problem…………………………………………………………………..1
Demand and Replenishment Issues………………………………………………………1
● Demand Forecasting………………………………………………………………….1
● Inventory Management……………………………………………………………….1
● Replenishment…………………………………………………………………………1
Logistics Operations Issues………………………………………………………………..1
● Warehousing……………………………………………………………………………1
● Handling and Storage………………………………………………………………….1
● Inventory Management………………………………………………………………..1
● Transportation and Delivery…………………………………………………………..1
Purchasing Issues…………………………………………………………………………….2
● Supplier Selection………………………………………………………………………2
● Negotiation and Bidding………………………………………………………………..2
● Contract Administration……………………………………………………………….2
Customer Service Issues……………………………………………………………………2
● Order Taking……………………………………………………………………………2
● Order Entry…………………………………………………………………………….2
● Order Processing………………………………………………………………………2
Areas of Consideration……………………………………………………………………..2
Alternative Courses of Action…………………………………………………………….3
● ST (Strengths–Threats)......................................................................................3
● WT (Weaknesses–Threats)................................................................................3
● SO (Strengths–Opportunities)............................................................................3
● WO (Weaknesses–Opportunities)......................................................................3
● SWOT MATRIX……………………………………………………………………….4-5
Conclusion……………………………………………………………………………………6
Recommendations…………………………………………………………………………..6-7
Documentation……………………………………………………………………………….8
Case Study Title: Supply Management of Japan Epson Electronics Company
Background of the Establishment
Japan Epson Electronics Company in Davao City is a branch of the globally known Seiko
Epson Corporation. While the brand is best recognized for its printers and imaging devices,
the company also manufactures high-precision timepieces. In Davao, their operations in
watches and machine parts rely heavily on efficient supply chain systems to maintain high
quality standards. The company collaborates with suppliers, logistics partners, and retail
outlets to distribute their watches effectively. With growing demand and the need for timely
replenishment, Japan Epson Electronics Company continues to adjust and improve its
supply management processes to remain competitive and customer-focused.
Statement of the Problem
This case study seeks to understand the supply management challenges of Japan Epson
Electronics Company, particularly in watch production and distribution. Specifically, it
answers:
1. Demand and Replenishment Issues:
1.1 Demand Forecasting – Difficulty in predicting accurate watch demand due to seasonal
fluctuations and new model releases.
1.2 Inventory Management – Overstocking of older models and stockouts of trending
designs.
1.3 Replenishment – Delays in supply chain response time when new stock is needed,
especially for popular models.
2. Logistics Operations Issues:
2.1 Warehousing – There is a shortage of staff in the warehouse, which leads to
mishandling of items. Environmental conditions like heat or humidity can damage the
watches. Because of the product’s value and fragility, it needs secure and proper storage.
2.2 Handling and Storage – Watches are sensitive to extreme temperatures. If the storage
area is too hot or too cold, items can get damaged. Proper ventilation and temperature
control are needed to avoid damage.
2.3 Inventory Management – Manual tracking systems sometimes lead to miscounts.
2.4 Transportation and Delivery – They face problems like heavy traffic and bad weather.
Sometimes, the product appearance does not match customer expectations, leading to
returns. Since packaging hides the product, delivery staff can’t check if the item is correct or
damaged.
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3. Purchasing Issues:
3.1 Supplier Selection – Some raw materials arrive already damaged, affecting the final
product. There’s also a risk of being scammed by dishonest suppliers. This causes delays
and quality issues.
3.2 Negotiation and Bidding – Epson faces challenges in ensuring fair and competitive
bidding processes between local and international suppliers. This issue may lead to inflated
prices, limited supplier diversity, and procurement delays, ultimately disrupting the timely
replenishment of watch components.
3.3 Contract Administration – Issues associated with regularly monitoring and enforcing
the terms of contracts with suppliers and logistics partners, which occasionally leads to
non-compliance, delivery delays, and disparities in service quality that impair the
effectiveness of their supply chain operations.
4. Customer Service Issues:
4.1 Order Taking – Some errors occur due to miscommunication between sales reps and
customers because some customers ask for too many discounts or haggle too much. Others
don’t trust the product and claim it's fake. These issues affect sales and customer relations
which creates trust and communication problems.
4.2 Order Entry – Slow encoding and manual order entry causes processing backlogs. It
delays operations, increases errors, and can be time-consuming
4.3 Order Processing – Manual approvals delay shipping and tracking can lead to customer
dissatisfaction
Areas of Consideration
● Inaccurate demand forecasting leads to inventory mismatch.
● Delayed replenishment limits product availability.
● Storage issues affect product handling.
● Poor communication slows customer service response.
● Staff shortages across departments affect warehouse operations, processing, and
customer service.
● Manual processes in inventory, order taking, and approval systems cause delays,
errors, reduce speed and accuracy.
● Fragile, high-value products require specific storage, handling, and delivery
standards.
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Alternative Courses of Action
ST (Strengths–Threats):
● ST1: Use quality assurance and brand trust to meet customer expectations.
● ST2: Use market data, retail insights, and warehouse stockpiling to adapt to demand
changes.
● ST3: Strengthen loyalty through branding, promos, and rewards.
● ST4: Maintain product quality by sourcing only from trusted suppliers.
● ST5: Train staff for better quality checks and secure packaging to ensure authenticity.
WT (Weaknesses–Threats):
● WT1: Offer competitive pricing and increase perceived value to reduce returns.
● WT2: Automate inventory, hire skilled staff to reduce errors and match demand.
● WT3: Use automated systems, GPS tracking, multiple logistics partners, and backup
plans.
● WT4: Automate contracts and evaluate suppliers to avoid delays.
● WT5: Add QR codes, seals, and protective packaging to confirm authenticity and
avoid damage.
SO (Strengths–Opportunities):
● SO1: Boost local sales through strong brand promotion.
● SO2: Let skilled staff manage digital inventory upgrades.
● SO3: Expand e-commerce using retail connections.
● SO4: Partner with reliable 3PLs to improve delivery and reduce costs.
● SO5: Use feedback via social media and surveys to keep customers loyal.
WO (Weaknesses–Opportunities):.
● WO5: Use digital tools and customer input to redesign packaging, improve order
handling, and ensure items meet expectations.
● WO1: Enhance product checks before delivery to meet customer standards.
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● WO2: Replace manual systems to reduce errors and delays.
● WO3: Improve online info and packaging quality to reduce complaints.
● WO4: Work with trusted logistics and automate tracking for smoother delivery.
● WO5: Redesign packaging based on customer input to protect items and meet
expectations.
SWOT MATRIX
INTERNAL (SW) STRENGTHS WEAKNESSES
EXTERNAL (TO)
S1: Existing warehouse and W1: High item return rate
logistics facilities in Davao due to mismatch in
City. expectations.
S2: Skilled local workforce W2: Lack of warehouse staff
in precision watch causing handling errors.
manufacturing.
W3: Manual inventory and
S3: Good relationships with order entry systems.
local retail outlets.
W4: Delays in contract
S4: Established updates/approvals and
partnerships with a few manual processes.
trusted suppliers.
W5: Poor packaging
S5: Established brand visibility causes undetected
recognition and product defects upon delivery
quality locally.
THREATS ST (How would the WT (What solutions can the
establishment take establishment formulate to
T1: Competition and pricing advantage of their strengths overcome their weaknesses
pressures. to overcome threats?) and threats?)
4
T2: Fluctuations in local ST1: Leverage quality WT1: Adopt competitive
demand. assurance to ensure pricing strategy and improve
products match customer perceived value to reduce
T3: Delivery delays (traffic, expectations. Use a strong returns
weather, fortuitous event). brand reputation to maintain
customer trust and loyalty. WT2: Implement automated
T4: Risk of damaged/poor inventory tools to adjust to
quality/defected raw ST2: Use market data and fluctuations in demand
materials or supplier scams forecasting experience to patterns and hired more
prepare for changes. Use skilled & experienced staff.
T5: Negative feedback from retail partners for real-time
customers claiming items market insights to adapt WT3: Adopt an automated
are fake. (customer production volume and inventory and order entry
complaints about product leverage warehouse system to improve accuracy,
authenticity) capacity to stock ahead for speed, and real-time
peak periods. tracking. Collaborating with
multiple logistics partners for
ST3: Build customer loyalty backup options, use GPS
using brand trust to handle tracking & route optimization
competitive threats and tools and risk management
offering freebies, discounts plan
or loyalty card.
WT4: Streamline supplier
ST4: Rely on trusted evaluation and automate
suppliers and use quality contract processing to
control to reduce risk of poor minimize delays
quality.
WT5: Strengthen its brand
ST5: Train staff to improve protection measures by
quality checks, including authenticity seals,
double-check packaging QR code verification, or
and item tagging to ensure tamper-proof packaging for
authenticity and match the legitimacy purchase.
expectations. Redesign packaging by
using clear, protective
packaging for visual
inspection before delivering
and fragile or inspection
labels
OPPORTUNITIES SO (How would the WO (How would the
establishment use strength establishment take
O1: Growing demand for to take advantage of the advantage of the
quality watches in the local opportunities) opportunities to overcome
market their weaknesses?)
SO1: Strengthen and
O2: Availability of digital maximize brand recognition WO1: Improve product
tools for inventory/order using brand image to boost inspection and quality
automation local sales control before delivery to
meet rising demand
O3: Expansion of online SO2: Use technical expectations.
retail platforms workforce to integrate digital
inventory systems. WO2: Transition from
O4: Opportunity to work with manual to automated
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better third-party logistics SO3: Use retail network to inventory and order systems
providers grow e-commerce to reduce handling errors
distribution and improve processing.
O5: Customer
preference/feedbacks/sugge SO4: Use its strong WO3: Use online platforms
stion/recommendations for relationships with trusted to provide better visibility on
fast and smooth service suppliers as a foundation to product info and packaging
build connections with better quality to reduce delivery
third-party logistics complaints.
providers, this allows it to
negotiate better and WO4: Collaborate with
enhance overall supply trusted logistics providers
chain efficiency. and automate tracking to
avoid delays and
SO5: Use its strong brand miscommunication.
recognition and trusted
product quality to actively WO5: Use digital tools and
engage with them through customer input to redesign
surveys, reviews, and social packaging, improve order
media. This creates a cycle handling, and ensure items
where satisfied customers meet expectations.
feel heard and are more
likely to stay loyal.
Conclusion
Demand and Replenishment:
Epson Davao struggles with predicting demand for watches accurately. This causes
overstocking or running out of popular items. They need better tools to forecast and respond
quickly.
Logistics Operations:
Manual systems and ventilation are causing delays and inefficiencies. They need to upgrade
their warehousing and tracking systems, especially for fragile items like watches.
Purchasing:
Supplier limitations and slow contract processes increase costs and delay operations.
Expanding and evaluating their supplier network can improve their purchasing power.
Customer Service:
Slow order processing and manual entries are frustrating customers. Automating these steps
can improve service and satisfaction.
Recommendations
Based on the case study on Japan Epson Electronics Company in Davao, here is our
recommendation for each strategy type from (ST, WT, SO, WO):
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ST (Strengths–Threats)
"Create a centralized customer feedback system integrated with product tracking”.
Leverage Epson's established reputation and technical infrastructure to gather real-time
customer reviews and link them to specific product batches. This strengthens brand trust
and mitigates threats from complaints about authenticity or defects.
WT (Weaknesses–Threats)
“Develop a rapid-response team for damaged goods and supply disruptions.”
Form a cross-functional team trained to handle unexpected supply chain issues, like supplier
defaults or weather-induced delays. This directly addresses staff shortages and the threat of
poor supplier quality.
SO (Strengths–Opportunities)
“Launch a Davao-based online exclusive watch line”
Capitalize on brand recognition and e-commerce growth by introducing a local online-only
watch collection. This creates a sense of exclusivity and allows the company to test new
designs based on digital feedback.
WO (Weaknesses–Opportunities)
“Implement a warehouse management system (WMS) with predictive maintenance
features.”
Use digital tools not only for inventory but also for proactively managing equipment and
storage conditions (e.g., monitoring temperature and humidity), addressing both handling
issues and automation opportunities.
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DOCUMENTATION
Video Link:
https://drive.google.com/file/d/1ble47h5PGjG7tOF55_YKDlG8aRWd07ce/view?fbclid=IwY2xj
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Pictures:
