In April 2008, Haverwood Furniture combined with Lea-Meadows, a maker of upholstered furniture for living and family rooms. The connection was not arranged in the typical manner. Because the two businesses were located on adjacent sites, and because the two firms would be autonomous to an extent that was economically practical, the merger proceeded without difficulty.
The Sales Manager of Haverwood Furniture and the Production Manager of Lea-Meadows were replaced by a general manager who was answerable to the Board of Directors of both companies.
The Sales Department of Haverwood Furniture was responsible for all sales activities including order entry, invoicing, and collections. The Sales Department consisted of five salespeople, three inside salespeople, and two outside salespeople. The Sales Department reported to the Vice President of Sales. The Vice President of Sales reported to the President/CEO of Haverwood Furniture.
In May 2008, the general manager appointed a new vice president of sales for the combined company. The new vice president was given the mandate to increase sales by 10% in the next 12 months. The new vice president was a Sales Manager at a large corporation and had no experience in the furniture industry.
In June 2008, the new vice president of sales hired a new Sales Manager for Haverwood Furniture. The new Sales Manager was given the mandate to increase sales by 15% in the next 12 months. The new Sales Manager was an experienced Sales Manager from the furniture industry.
In July 2008, the new Sales Manager hired two new salespeople. One salesperson was given the territory of North Carolina and the other salesperson was given the territory of South Carolina.
In September 2008, the Vice President of Sales asked the Sales Manager to prepare a report showing how each salesperson was doing in terms of sales. The Sales Manager prepared the report and presented it to the Vice President of Sales.
The Sales Manager reported that each salesperson was doing well in terms of sales. However, the Sales Manager also reported that the two new salespeople were not meeting their quotas. The Vice President of Sales asked the Sales Manager to find out why the two new salespeople were not meeting their quotas.
The only major issue that remained was how to combine the selling efforts. The question was straightforward: “should we give our sales staff the upholstery line of chairs and sofas, or should we keep using sales agents?” According to Haverwood’s vice president, the line should be given to his sales team, but Lea-Meadows argued that it should stay with sales agents.
The Sales vice president felt that if the company gave the upholstery line to his sales force, they could sell it more effectively and make more money for the company. The Sales agents on the other hand, felt that they knew how to sell the upholstery line better than anyone else and that giving it to the sales force would be a mistake.
After much discussion, it was decided that the Sales agents would continue to sell the upholstery line and the Sales force would continue to sell the wood furniture. This decision was made because it was felt that each group knew their product line best and could sell it more effectively. This also allowed Haverwood to keep its options open in case one of the groups was not selling as well as the other.
Haverwood Furniture Inc is a company that sells both wood furniture and upholstered furniture. The company was having some difficulties with its sales force and so it decided to give the upholstery line of chairs and sofas to its sales agents. This decision was made because it was felt that each group knew their product line best and could sell it more effectively.
This also allowed Haverwood to keep its options open in case one of the groups was not selling as well as the other. Sales have increased since this decision was implemented and Haverwood has been able to maintain its position as a leading furniture company.
Lea-Meadows Inc. is a little, privately owned upholstery maker that creates living and family room furniture. The company has been in operation for more than 75 years. Their net sales in 2007 were $5 million and the overall industry sales in 2007 were $15.5 billion. In 2008, a predicted market value of $16.1 billion is expected. Over the previous five years, growth had increased at an annual rate of 3%, which we believe would continue in the future.
Haverwood’s market share was at 0.03% in 2007. In order to remain profitable and increase sales, Haverwood has decided to lower their prices by 10%. The president is hoping that this will help them still make a profit while being able to offer a lower price to their customers, which will in turn lead to an increase in sales. Sales for the company are directly related to how many products they can sell. In order for Haverwood to increase sales and gain a larger market share, they need to find ways to get their product into more stores.
The company is currently selling their product through wholesalers who then sell it to retailers. Haverwood has very little control over how much retailers mark up their product and they believe that this is one reason why their sales have been stagnant. In order to increase sales, Haverwood needs to find a way to sell their product directly to retailers or to find a way to get more control over how much retailers can markup their products.
One way that Haverwood could increase sales is by selling their product online. This would allow them to reach a larger audience and sell their product at a lower price since they would not have the same overhead costs as they do when selling through wholesalers and retailers. Another option for the company would be to open their own retail store. This would give them more control over pricing and allow them to showcase their products in the best light possible.
