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The Case of Southern Chair

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Isaac Downey

on 26 November 2014

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Transcript of The Case of Southern Chair

The Case of Southern Chair
1.Foreign wood manufacturing had been on the rise, and domestic wood manufacturers had seen moving overseas.
2. Existing and proposed U.S. trade policies affected its ability to compete.
3. Economic downturn fueled by crises in the banking and mortgage industries resulted in a distressed housing market.
4. Internet retailers opposed any price increases which resulted the company selling products at a low margin.
1.Not in a financial position to invest in new equipment when old equipment had limitations.
2.Unfamiliarity with the added administrative costs of the new internet retail customer channel while the internet customer group was on the rise.
3. Few efforts in markets. For instance, there were no in-house salespeople.
Introduction / History
Founded 1931 in Lexington NC
Purchased in 1994 by Sarah and Robert Drake
Specialized in wood - based household furniture
Chairs / barstools
Rocking chairs
Children's chairs
Side tables
Opportunites: Leverage Trends
2011 Re-shoring Trend
Job promotion/incentives
2013-2014 New Home Construction
Buy America Trend

Opportunities: Expansion/Marketing
Fill a market niche
Engage in market expansion (foreign)
Online retail
Children rocking chairs
Declining Revenues
Strengths: Early stage investments
Capital infusion
Investment in Technology
Investment in Marketing
Investment in data collection
Institutional knowledge

Strengths: Diversification of Product
Multiple Models
Assembly & Ordering & Full-fillment

1998 - NAFTA and other trade agreements
Lower labor costs overseas
The "Production Concept" at work (p. 9)
2000 - 2002: $5 billion in wood furniture imports from China
2007: $15 billion annually
Economic Recession

Hire a marketing manager
Re-negotiate contracts or cut ties with existing internet retailers.
Expand online presence
Full transcript