You are the producer of a new soft drink that boost energy for all kinds of people. Walmart has been a good retailer who has been selling your product nationwide. You received a phone call recently from Walmart that they do not like to continue keeping your drink due to a sudden decline of sales. You called for an immediate meeting with the sales team of your company and decided to send this team to meet with the purchase director of Walmart.

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You are the producer of a new soft drink that boost energy for all kinds of people. Walmart has been a good retailer who has been selling your product nationwide. You received a phone call recently from Walmart that they do not like to continue keeping your drink due to a sudden decline of sales. You called for an immediate meeting with the sales team of your company and decided to send this team to meet with the purchase director of Walmart. The sales team to meet with the purchase director made up with four members. The following issues to be discussed and included in your report.

  1. Identify the reasons for sales decline
  1. Discuss the out of stock situation and its possible solutions

FACTS:

  • Manufacture selling price per unit $0.80
  • Manufacturer selling price per dozen $9.60
  • Retail price per unit at Walmart $2.00
  • Retail price per dozen at Walmart $24.00
  • Retail price per unit at competitors’ stores $1.90
  • Retail price per dozen at competitors’ stores $22.80
  • Walmart sales per year $3 million in each store and the product kept in 150 stores countrywide
  • Other stores sales per year $1 million and product kept in 200 stores country wide

Walmart does not have any promotional consideration for your product and it is displayed with other competitive products. Further, the store has a 10-year backdated system to report inventory before the products go out of stock. The store reported a breakdown of the system at least 4 times in the previous year (2019). At least 50% of the customers move to other stores if the product is not available. At least 20% of the customer look for new items and move to other stores but Walmart refuses to keep any new item(s) due to ongoing decline of sales.