Professional Documents
Culture Documents
Southwestern Ohio
Steel Company LP
The Matworks Decision
Group 48
Name
Vijayeta Bhatia
Abhimanyu Dev
Saurabh Doshi
Kumar Abhishek
Roll no
15S755
15F601
15S639
15F527
Problem Statement
What should be the consideration aspects for Dan Wilson to make his decision on
investment in Annual Sales Meeting of Matworks, Inc.
Industry and competitors
SOSLP
SOSLP started in 1945 and currently (in 1994) has around 500 clients, annual
turnover of $250 million and annual shipments of around 400,000 tons.
One of the two strengths of the company are its value added processing
which is to provide specific type of products according to requirements.
The other strength is good demand forecast leading to cost saving by
purchasing at best quotes, having minimum inventory and efficient
transportation system
SOSLP has believed in having long term relationships with customers by
giving competitive prices, good service and healthy negotiations.
SOSLP didnt spend on advertising and didnt believe in lavish dinners and
gifts to maintain relationships. Rather they believed in proper timely and
required communication and holding the line on process for clients in tough
times to help them not to run into losses due to supply side problems.
They spent less than one-hundredth of percent of sales was allotted to
advertising and promotions
The extent of SOSLP spending on advertising and promotions was usually an
occasional lunch or if possible tickets of a baseball game.
Matworks, Inc had been the biggest customer for SOSLP initially but then the
sales were slow for Matworks due to recession and with time they dropped
out of the biggest customers list of SOSLP. In 1990 they had been 29, in 1993
they were 90th. From $2 million they had dropped to $0.672 million. The
relationship was positive but it was no more the top 25 customer. The top 25
customers bought in two third of the business to SOSLP.
Matworks had sent a letter asking SOSLP to participate as a sponsor in their
annual sales meeting in Hilton Hill, Carolina. The donation started from $5000
and went till $30,000. SOSLP spent less than one-hundredth of percent of
sales was allotted to advertising and promotions and didnt believe in
advertising. Dan wanted to carefully tackle the situation as this could affect
their sales and relationship with Matworks.
The decision
Without turning relationships sour, SOSLP can inform Matworks about the policy of
not investing into promotions as a conscious decision as it is not their style of doing
business. This move when executed with proper communication ( face 2 face) and
logical manner will not affect the business relationship as
They should not invest and inform Matworks in a Face to face meeting owing to their
company policy on advertisements.