Hallstead Jewelry Case Study
INTRODUCTION: Hallstead Jewelers is a family owned company that has been around for generations. After the death of their father Gretchen and Michaela resumed ownership of a business that had been very successful for many years. However, due to changes in the market related to competition, customer demand, and demographics, business has not been as profitable as the sisters hoped it would be upon taking over of (remove) the company. Michaela and Gretchen are now faced with the tough task of revitalizing the business. They must first determine the best course of action to take after a decision to move to a new location that has proven to not be a key place for foot traffic and jewelry buyers. Michaela’s and Gretchen’s challenge is to determine a way to return to profitably all while not eliminating commission based pay; a strategy that their father and grandfather were totally against.
RECOMMENDATION: The recommendation for the managers at Hallstead would be to perform a marketing analysis of their customer base to determine its buying power. It would also be a good idea for the managers to get a better understanding of who their competitors’ are to determine the types of items that are being sold, that are doing well in their stores, as well as online and develop a new marketing strategy.
Hallstead Managers should also reassess their decision to make a location change. By doing so, new ideas should be developed for re-attracting old customers and generating new ones to the new location. In addition, completely eliminating the sales commission may not be the appropriate thing to do either.
CONCLUSION: In order to operate an effective and profitable business, it is imperative that the business owners perform the appropriate business analysis’ (Remove) before making decisions. In this case, the sisters should take into consideration that any decision regarding the commission should be based on the company’s profit versus sales. If the company does not make
RECOMMENDATION: The recommendation for the managers at Hallstead would be to perform a marketing analysis of their customer base to determine its buying power. It would also be a good idea for the managers to get a better understanding of who their competitors’ are to determine the types of items that are being sold, that are doing well in their stores, as well as online and develop a new marketing strategy.
Hallstead Managers should also reassess their decision to make a location change. By doing so, new ideas should be developed for re-attracting old customers and generating new ones to the new location. In addition, completely eliminating the sales commission may not be the appropriate thing to do either.
CONCLUSION: In order to operate an effective and profitable business, it is imperative that the business owners perform the appropriate business analysis’ (Remove) before making decisions. In this case, the sisters should take into consideration that any decision regarding the commission should be based on the company’s profit versus sales. If the company does not make
References: (n.d.) Building a Profit Volume and Breakeven Analysis. Acquired August 7, 2010. URL: http://www.stephenlnelson.com/MBAxlch11.pdf