Issues and constraints
The issue, which Cardon Carpet is facing, stems from the lack of expansion throughout the United States, specifically limiting their contract sales portion of its business only to the southeastern portion of the United States. Cardon Carpet Mills has several action options:
1. Expand its market share in contract sales segment throughout the US. Employ ten sales representatives to seek potential institutions and businesses throughout all of the US. Compensate these personnel based on commission, that is, the amount of clients they contract to the business. 2. Sell its products of Contract sale to institutions and businesses especially ones located in the metropolitan areas their wholesalers reside in. 3. Present a contract that specifies a referral of at least five institutions by each of their wholesalers and in turn Cardon would compromise in regards to the “Margin Sharing” proposal. Organization Assessment
Cardon Carpet Mills, Inc. is a privately held manufacturer of a full line of medium-to-high-priced carpet primarily for the residential segment. The company markets its products under the Masterton and Chesterton brand names. Robert Meadows is the president and Suzanne Goldman is his special assistant. Refer to Exhibit 3. Market and Industry Assessment
Wholesale and retail distribution in the U.S. carpet and rug industry has gone through a lot of instabilities since the 1980’s. Shaw Industries, a manufacturer, the carpet and rug industry leader opened its own retail stores but suffered losing many of their buying groups. Shaw eventually sold its retail stores and returned to their prior channel. The Market has experienced an increase in dollar sales, however this is offset by limited profitability for manufacturers. Refer to Exhibit 2. Customer Assessment
Cardon Carpet’s direct customers include: institutions and businesses and wholesalers. Cardon’s indirect customers include: Retailers and consumers....