Sales and Carbon Dioxide

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Dracca became aware that one of its competitors, TrendBaby, Inc., was soliciting information from one of Dracca’s employees, Bob Shumaster. Shumaster was apparently detailing product assembly information that was unique to Dracca and explaining to TrendBaby how this assembly strategy saved Dracca thousands of dollars each month. Dracca discovered that TrendBaby actually hired Shumaster to provide this information, and that Shumaster was using Dracca company computers to relay the proprietary information to TrendBaby via email. Meanwhile, Sally May, a sales representative for Dracca ran into her neighbor who is a sales representative from one of Dracca’s competitors. May is friendly with her neighbor, and drives her children to school each morning. The families get along well, and often have barbeques and other social events together in the neighborhood. As part of the small talk, May mentioned to her neighbor the new sales promotion Dracca was offering retailers on its full line of products. Although the promotion had been mentioned in trade publications, May’s neighbor had not yet heard about it and was curious about its details. May worked closely with the marketing department. Her colleague in marketing, Rick Martin, developed the new slogan for Dracca’s crib products: “A Full Night’s Sleep.” In the Internet advertisement for this campaign, Dracca claimed that babies using its crib products slept two hours longer than other infants. This was an unverified statistic. Dracca’s crib sales increased 50 percent because of this advertisement, but they received many complaints from unsatisfied parents. Dracca sold the cribs to eight different retailers across the United States. Dracca charged six of the retailers $75 per unit, but they only charged the other two retailers $50 per unit because they were Dracca’s best retail customers. Due to the price differential, the two retailers with the $50 per unit price were responsible for 96 percent of Dracca’s sales, even...
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