HANDY ANDY INC.
1. Is this a customer service problem? Why or why not?
The issues that Jose` Ortega discovered concerning Handy Andy are customer service problems. The customer does not recognize the separate segments of the supply chain; they only acknowledge the supply chain as Handy Andy as a whole entity. There were several “service failures” throughout this case. Although it was not noted that there were lost, damaged or incorrect deliveries; there was still a disconnect in service that left the affected customers dissatisfied. Service failures dictate crucial “moments of truth” for a retailer and its customers. These moments are vital to whether a customer will ...view middle of the document...
Conflict arises in the channels when one channel member believes another channel member is engaged in behavior that prevents the company from achieving its goals. There is vertical and horizontal conflict within Handy Andy’s marketing channels. The factory distributors discrediting Handy Andy’s warranty policy represents vertical conflict between the manufacturer and wholesaler. This situation depicts the factory distributors giving more attention to their profit margins than to the satisfaction of the customer. The factory distributors undermining the smaller retailers’ quality of service through delayed deliveries, poor installations, and unprofessional behavior display horizontal conflict.
3. Logistics channels handle the physical flow of goods or services. Is the problem discussed in Handy Andy’s logistics channel? Why or why not?
Logistics channels “bridges the discrepancy between the assortment of goods and services generated by the producer and the assortment demanded by the consumer” (Murphy and Wood, 2011, p. 16). In this case, there was not much difficulty in the physical flow of garbage/trash compactors; it was established that the factory suppliers were expected to be the sole source for compactors including installation and delivery. Handy Andy’s demand management within the distribution centers is a key factor to the success of their logistics channels. Keeping a complete “stock of all styles and trims” increased customer demand response and increased demand forecasting proficiency (Murphy and Wood, 2011, p. 130) . Also, their order management...