CONTROL OF RETAIL DISTRIBUTION BY A SHOE COMPANY.

The article presents a case study of the Childers Shoe Company, which had abandoned the use of wholesalers and was frustrated with the results of selling directly to retailers, and decided to open its own retail chain. Faced with a competitive market, the company decided to match a deal made by another shoe retailer and sell all of its shoes for $6 a pair. This strategy would realize a average 32% profit margin on all shoes sold. The article presents and analyzes the details of the plan, which only applies to their own retail outlets, not to those retailers to whom it also supplies shoes. The author suggests that the company has chosen to favor its retail business over its manufacturing business. The article suggests and discusses three possible remedies to the situation.