Submitted by: Submitted by Maizulaiha
Views: 720
Words: 1034
Pages: 5
Category: Business and Industry
Date Submitted: 01/04/2012 02:10 AM
Mai Zulaiha Baharuddin
EMBA UiTM 2011
Assoc Prof Dr Faizah Abd Rahim
Step 1: Define the problem
A mass merchant store contacted Fe’nix in 2009 asking to sell a large product line. The store said they would pay 10% below the company’s existing prices and the purchase would be for no less than $750,000. Purchases were expected to be 4million annually however, to satisfy the contractual obligation, the company would have to triple its replica production. Accepting the contract would have a severe impact on how the company defined its business.
The real question to be asked is: Do they want to accept the contract offered or remain as an authentic artifacts supplier i.e. rejects the contract?
Fe’nix objectives:
- To supply authentic artifacts to its buyers and remain exclusive as authentic supplier
- Increase in sales and revenue
Fe’nix Constraints:
- Political situation in Africa and government rule that does not allow export of artifacts due to “national significance” issue has limited product supply
- Increasing number of competitors that sell authentic artifacts and replicas
- Increasing number of buyers who go straight to craftmakers that reduces Fe’nix’s retail sales
Step 2: Enumerate the decision factors
There are two sets of decision factors that must be enumerated in the decision making process which are:
(a) Alternatives course of action – controllable decision factors which include the marketing mix; product, place, price, and promotion strategy:
Place: Fe’nix could increase its branches to improve distribution channel of its products
Price: With the slipped of bargaining power due to increasing competitors, Fe’nix needs to consider changes on its products’ price but at the same time remain exclusive.
Promotion: Improve product market strategy via huge promotion on awareness about originality/authenticity of artifacts
(b) Uncertainties – uncontrollable/external factors
Competitors: Fe’nix can’t control the existence of...