What should josh do about the boise situation

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Reference no: EM132231693

MoxyChem manufactures and distributes chemicals in the western United States, Mexico, and Canada. Usually the company sells to a distributor, which sells to the customer that uses the chemicals. Hudgins ChemSupply is the biggest distributor in Idaho and represents nearly 15 percent of Josh Carter’s annual sales. Recently Josh acquired a new account in the same area, Boise Chemicals, which has the potential to be just as large. His most recent meeting with Marsha Hudgins, owner of Hudgins ChemSupply, though, went like this:

“Look, Boise Chemicals underbid us on the Canuck contract by 10 percent. You must be offering Boise a better price than us, and I want to know why,” said Marsha.

Josh knew that Boise bid that job with no profit in order to win the Canuck contract, with plans to grow margins once it was able to prove better service. Moreover, the price Josh quoted Boise was actually 5 percent more than Marsha’s. “Marsha, I’m not giving Boise a better price—it doesn’t buy as much as you do from us, so I can’t.”

“Huh. You’ll have to do better than that. You know that the Farley solvents contract is coming up, and it is going to be big. I want to know what Boise intends to do about it.”

“Marsha, if I told you Boise’s strategy, as if I knew it, why would you ever trust me with your information?”

“C’mon. I’m your biggest customer. We have to stick together.”

“Well, I don’t know Boise’s strategy.”

“Try to find out. And while you’re at it, I think I can get the Mohawk Paper account away from Durcon if you’ll give me just a 5 percent discount on those products.”

Durcon wasn’t one of Josh’s distributors and the Mohawk Paper account was big, at least $100,000 per month, but Josh also knew he was as low as he could go with Hudgins on price. Maybe he could get by with sending some product as “free samples”?

Questions

1. What should Josh do about the Boise situation? Should he try to find out if Boise plans to bid on the Farley contract and, if so, what its strategy is?

2. What should Josh do about the Mohawk account?

3. Describe Josh’s relationship with Marsha. Where should he go with this account in the future?

Reference no: EM132231693

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