East Coast Auto Supply, a distributor of auto parts located in the New England area, received much of its inventory of rebuilt auto parts from a Los Angeles wholesaler that imports the remanufactured parts from several Asian countries where labor costs are low. East Coast Auto Supply received most of its shipments by truck, which generally took a week to ten days to arrive. One day, an airfreight company sales representative called on the firm to attempt to sell it on the use of airfreight. José Menedez, the owner of East Coast, did not wait for the sales pitch. Instead he wanted to get right to the “bottom line” by asking the sales representative for the cost per ton to ship goods by airfreight. After learning the cost, Menedez laughed and told the airfreight representative to “get out of the office.” It was more than double what East Coast paid for truck transportation. Might Menedez have been too hasty in throwing the airfreight sales representative out of the office? Explain.
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