Nonono Essay

3093 Words Jun 1st, 2013 13 Pages
GUIDING QUESTIONS FOR ANALYSIS OF THE WESTLAKE HOME FURNISHINGS LTD CASE
(Case to be used for Class Discussion on Tuesday, Aug.19)

1. Analyze the North American home furnishing industry using both Porter's 5-forces and the PEST models.(Book 1 Chapter 3) 2. Oualitatively, what are the possible advantages and disadvantages of Bowman accepting his customer's price reduction proposal? Do you think Bowman should proceed with the reduction? Why or why not? 3. What other recommendations might you propose or support to improve West Lake's performance?

Richard Ivey School of Business

The University of Western Ontario

IVEY
9B07M071

WEST LAKE HOME FURNISHINGS LTD.

Ken Mark wrote this case under the supervision of Professor
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This customer, a large U.S.-based retail chain, accounted for about one-third of West Lake's wholesale business in 2006. On the one hand, Bowman found the prospect of boosting sales attractive. On the other hand, Bowman knew that agreeing to a reduction in retail price of this signature product for one customer could force prices down in his wholesale, retail and Internet businesses. Still, Bowman wondered if this was an offer he could afford to refuse.

THE CANADIAN

RETAIL MARKET

In 2006, with sales of more than $200 billion 1 and a wide selection of products offered by retailers, the Canadian retail market was highly competitive. Large chains, such as U.S.-based Wal-Mart Stores Inc., Canadian Tire, Hudson's Bay Company and Sears Canada, accounted for about one-third of the retail market. The chains offered consumers a wide variety of home furnishings, generally carrying three or four national brands and a private-label line. The other two-thirds of the market consisted of thousands of small retailers, most of which had local or regional presence. These smaller retailers rarely had private-label lines in home furnishings, preferring to carry national brands. Smaller retailers typically had limited shelf space, which meant that they could carry only a small selection of items and ordered in small volumes. Sales in the home furnishings category had grown from $7.6 billion in 2002

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