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Dew Case Study Solution

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DEW relies on a complex distribution system in order to get their products to its customers. Only about 30 percent of the firm’s total sales are purchased directly from DEW. Smaller companies and retailers usually make purchases through one of the many independent distributors. Unfortunately, it’s been recently discovered that the results are terrible and profits are down 30 percent from this same quarter time last year. In order to boost sales, senior management has decided to eliminate all direct sales from DEW, distributors are now required to maintain a minimum inventory level which is higher than before, and form a task force to study and propose ways that the firm can recapture its lost market share. I do think that it was smart to eliminate …show more content…

DEW also gives a variety of many different distributors that it should not be that difficult for them to locate one. If DEW requires their distributors to maintain a minimum inventory level, this may be a good short-term option, but if the company wants to stay in business long term, this may not be the best thing to …show more content…

However, if there is not a high demand for their products, there is still that possibility that their distributors will return their inventory to them within the nine month time frame. If all the distributors return the inventory because they weren’t able to sell the product, DEW’s cost of inventory will skyrocket bringing the company back to the bottom. A quick temporary fix should never be the appropriate solution for a business that has long-term goals. Voiding the problem and going with a quick fix will only lead to company failure. Another factor that may make distributors less interested in DEW is the fact that they want their distributors to continue to taking inventory delivery for the next two months after a product return even if they don’t need it. After considering how all these changes may affect DEW and their distributors long term, I would not be comfortable announcing these changes to anyone. However, if this was the company that is providing me with my job and income, I will always stand by company decisions and give my best effort in

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