Case Study on Dakot Office Supply
A Case Study on Dakota Office Supply
Case: Dakota Office Products
1. Background Information
Dakota Office Products (DOP) is a regional office supply company with a strong reputation for customer service and quality supplies. Additionally, DOP is unafraid to adopt new services such as its desk top deliver option which delivers smaller orders directly to individual sites as well as its traditional commercial freight delivery. DOP has also introduced and Electronic Data Interchange (EDI) in order to ease data and payment transfer from and to customers as well as building a customer website that acts as an order and account interface for its customers.
2.1 People/Key Players
John Malone General Manager
Melissa Dunhill Controller
Tim Cunningham Director of Operations
Wilbur Smith Site Manager
Hazel Nutley Data Entry Operator
2.2 Chronology of Key Relevant Events
John Malone, General Manager for Dakota Office Products was concerned about the financial results for 2000 since the company just suffered the first loss in company history. Recently, DOP has attracted new business by offering a desk top delivery option which delivers smaller orders directly to customer sites. Dakota charges a small mark up of 2% for this service. DOP has historically priced its products by using a traditional method of cost accounting by marking up purchased products by 15% to cover warehousing, freight, and distribution and then adding another markup to cover general and selling expense plus an allowance for profit. Dakota has also introduced electronic data exchange (EDI) and a new internet site which allowed customer orders to be placed so that clerks would not have to enter customer and order data manually. Several customers have switched to this method for the convenience but Dakota’s costs have continued to rise. John sent Melissa and Tim into the field to get a clearer picture of the company’s activities and costs. Melissa and Tim met
Case: Dakota Office Products
1. Background Information
Dakota Office Products (DOP) is a regional office supply company with a strong reputation for customer service and quality supplies. Additionally, DOP is unafraid to adopt new services such as its desk top deliver option which delivers smaller orders directly to individual sites as well as its traditional commercial freight delivery. DOP has also introduced and Electronic Data Interchange (EDI) in order to ease data and payment transfer from and to customers as well as building a customer website that acts as an order and account interface for its customers.
2.1 People/Key Players
John Malone General Manager
Melissa Dunhill Controller
Tim Cunningham Director of Operations
Wilbur Smith Site Manager
Hazel Nutley Data Entry Operator
2.2 Chronology of Key Relevant Events
John Malone, General Manager for Dakota Office Products was concerned about the financial results for 2000 since the company just suffered the first loss in company history. Recently, DOP has attracted new business by offering a desk top delivery option which delivers smaller orders directly to customer sites. Dakota charges a small mark up of 2% for this service. DOP has historically priced its products by using a traditional method of cost accounting by marking up purchased products by 15% to cover warehousing, freight, and distribution and then adding another markup to cover general and selling expense plus an allowance for profit. Dakota has also introduced electronic data exchange (EDI) and a new internet site which allowed customer orders to be placed so that clerks would not have to enter customer and order data manually. Several customers have switched to this method for the convenience but Dakota’s costs have continued to rise. John sent Melissa and Tim into the field to get a clearer picture of the company’s activities and costs. Melissa and Tim met
References: Latshaw, C. A., & Cortese-Danile, T. M. (2002). Activity-Based Costing: Usage and Pitfalls. Review of Business, 23(1), 30. Retrieved from EBSCOhost.