By Jon Ezell
1.Yes; this problem has a negative impact on the customer. Customers who purchased a compactor from Handy Andy were shown to receive improper customer service by the factory distributors. This poor customer service manifested itself in the form of longer delivery times, as well as leaving the compactor in the middle of a customer’s kitchen without giving the proper operating instructions to the customer. Ortega also discovered that the factory distributors in certain cities were misleading customers into dealing directly with them rather than the small dealer they originally used, as well as making disparaging comments about the small dealers to support their claims. The result of these two problems is an unprofessional experience for the customer, which creates doubt in the quality of the product.
2.This is a problem with the marketing channels, as certain large distributors are trying to cannibalize the competition (other dealers) in an unethical manner, and at the expense of Handy Andy’s brand reputation. If this practice were allowed to go on, the smaller dealers may have been forced to stop carrying the product, which would ultimately result in fewer sales.
3.The flow of goods to the customer’s home was delayed in instances where the customer purchased a compactor from a smaller dealer. This problem was reported the supervisor and the VP of marketing, who apparently manages the ‘Order Management’ area of logistics.
4.It is probable that the small dealers are unaware of the exploitation. Without taking surveys of their own, they could assume that the product was really out of stock, and then be unable to compete with the larger distributor when the customer was offered a better model for a lower price. If there was an ongoing problem with these supposed stockouts, the smaller dealers would need to implement vendor quality control programs to help identify the problems.1
5.The VP of...