As a company that assembles electronics parts to create music players for consumers (MP3s, car audio systems, etc.), eShock recently received word that one of its major suppliers of a central component which is used in its various electronics devices was raising prices. eShock sells these devices through various consumer electronics retailers including brick-and-mortar outlets as well as online channels. eShock faces several options:

1. take a hit on profits without changing prices for its customers

2. try to increase business with alternative suppliers

3. raise prices for its finished products sold to the consumers

4. reduce production to manage costs, inventory, and consumer pricing

Q.1. List and explain 3 advantages and 3 disadvantages for each of the above-listed options. Please create a separate heading for each option and then create sub-headings for advantages and disadvantages. 

Q.2. What recommendation (of the 4 listed above) would you make to the company and why? Explain your answer.

Q.3. Develop an additional recommendation of your own (independent of the 4 options listed in the scenario). Detail a step by step implementation plan for your recommendation. 

Answer rating: 100% (QA)

Q1 Advantages and Disadvantages for Each Option 1 Take a Hit on Profits without Changing Prices Advantages Customer Loyalty Maintaining current prices could foster customer loyalty and satisfaction Co... View the full answer