Sunday, July 13, 2003
Business Problem 1.
Ty Beanie Babies.
My dad for years carried several different brands of stuffed animals in his stores. He carries Mary Meyers, and Ty for the largest bulk of the items. For at least 10 years he carried every item in Ty's lineup. An he carried beanie babies when they first came out. He always got the orders he placed, and had not a lot of issue selling them. Then they got popular, really popular. The orders he got became less and less frequent, not that they were back ordered, but that they no longer met the standards for a minimum order. "You need to order full lots of each style", "you need to add more styles" "You need to buy this kit with our other new products before you can place a beanie order"
So in short, the very people that kept the company afloat for years by buying the products before the breakout hit, were the ones that got cut out as the dollars started flowing in.
Does a comapny owe a debt to the members of its distribution channel? to its customers? Is there a way to track this in accounting terms that would be appropriate? Does there need to be one created?
Ty Beanie Babies.
My dad for years carried several different brands of stuffed animals in his stores. He carries Mary Meyers, and Ty for the largest bulk of the items. For at least 10 years he carried every item in Ty's lineup. An he carried beanie babies when they first came out. He always got the orders he placed, and had not a lot of issue selling them. Then they got popular, really popular. The orders he got became less and less frequent, not that they were back ordered, but that they no longer met the standards for a minimum order. "You need to order full lots of each style", "you need to add more styles" "You need to buy this kit with our other new products before you can place a beanie order"
So in short, the very people that kept the company afloat for years by buying the products before the breakout hit, were the ones that got cut out as the dollars started flowing in.
Does a comapny owe a debt to the members of its distribution channel? to its customers? Is there a way to track this in accounting terms that would be appropriate? Does there need to be one created?
