Handy Andy Case Study

Handy Andy, Inc., a maker of trash compactors, made two models of trash compactors the standard and the deluxe, the latter having more capacity thus a higher price (Murphy & Knemeyer, 2015). The distribution of the trash compactor to the end user worked like this, a customer makes an order for a trash compactor through a licensed retailer, once the order is made the retailer buys from the distributor to fulfil that order and then delivers it to the customer (Murphy & Knemeyer, 2015). The initial agreement between Handy Andy Inc. and the distributors was based on delivering and installing all units in a period of 5 days after an order was made by a retailer, as compensation for such service the distributor would get 9% of each unit sold (Murphy

In order to fix the problem of distributors taking the full credit for the warranty being offered, and contacting retailer’s customers directly, the distribution manager in coordination with the marketing department within Handy Andy Inc. should consider the following solutions and pick one based on a careful analysis of the costs and benefits of each. The company can invest in creating a distribution network that belongs to Handy Andy Inc. and stop depending on the current distributors in these cities, which would mean a considerably high initial investment and higher costs to keep the distribution network running, or they can just change the distribution company in these cities for another that is more aligned with their interests. Also a third choice would be to convince the current distribution companies to stop their unethical behavior by explaining to them the negative impact that their actions are having on customer service and the whole supply chain in general. If explaining how their actions affect Handy Andy Inc. is not enough to convince them to change the things that they are doing wrong, the company should proceed to putting these distributors on notice that their contracts won’t be renewed and action would be taken so retailers learn of how they have been selling directly to their customers instead of just fulfilling the orders. It‘s my opinion that after these distributors are faced with the possibility of not having their contracts renewed and retailers learning about their unethical behavior they will behave according to the wishes of Handy Andy Inc. in order to protect the source of revenue that Handy Andy Inc. and retailers represent. While is true that contacting the retailer’s customers directly and taking the full credit for