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Questions 1. What should Charles do? Should he allocate the facings on the POG to maximize Super Saver's sales, as Alice expects? Or should he rework the POGs so that his own company, Breston's, can tum things around? 2. What are the short- and long-term risks and benefits of the decisions that Charles makes? 3. What are the potential personal risks and benefits for Charles? 4. Is Charles's personal relationship with Alice potentially affecting his judgment in this situation? 5. If Charles makes the decision to reduce the SKUs for his products, should Deke take any action? 12 Tough decisions Something to snack on Brendan D. Murphy and Patrick E. Murphy Major players Breston's Salty Snacks producer Cleries - Breston's Category Advisor for salty snacks Doke=salty snacks' Account Manager for Breston's B&M - Breston's main competitor Super Saver = major retail chain Alice - Buyer for Super Saver Introduction Deke couldn't believe his eyes as he reads the sheet of paper handed to him by Charles during their weekly meeting. He studies the POG and realizes he is losing four SKU of his company's branded product, while the competitor, B&M, was gaining five. "How could you do this to Breston's peke shouts. There is no way I'll be able to hit my Fiscal 2012 sales goals with all of this distribution loss! "B&M's product introductions are simply stronger and they had a better year, Charles replies. "I have to give the extra shelf space to the stronger brand. If Breston's has a good year this year, we'll take another look at the shelf and reallocate where necessary Background of characters To understand the implications of Charles decisions. it's first important to recognize the Sackground of luis situation. Ile had been working at Breston's for three years primarily in Category Adviser capacity. As a Category Adviser for the national grocery chain, Supersaver , Charles is in charge of properly allocating shelf space to each product and Seard in the POG. He analyzed unit sales, dollar sales, price points, and sales velocity for sich of the SKUs in his category, and makes decisions based on his analysis about how Products are performing ranging from adding and deleting to increasing and decreasing sel space. Charles is incented on the growth of the overall category, not just Brestan's Although he had only worked at Breston's for a few years, Charles was considered a kitong star at the firms. This was his first role out of graduate school, caming his MBA at Wiaron, and graduating second in his class. Prior to business school , Charles traveled the ld as a consultant for Mickinsay, but grew tired of the hours and living out of a suitcase. Esta inundated with offers from banks as he wrapped up his MBA, but vias intrigued by sodacts. Terch den nu Bulletida maht 2010 with Jeelinmy sales by is but was still lost twice the of Super Saker at S1153 in sales anually. It was considered more che ha Supersoner offering consumers trends new products and staying on the cutting edge of not unty food, butaba Ghion When the economy was por forming well. Bulls also the is copia the trendy retailer. When the cominy w down, however Consumer perceived Super Sacs simple format as translating to lower prices and stiti their alty toal Breston's sales department structure Chaths worked in the dission at Breston's where employees were disidor up by retuler and allocate persoanel by iwanhatter's business Impleseus of Breton's cred to work in one of a capo direct lexor category management The sales cams or Account Managers are responsible for compilingan mul plan of promotions and selling to the buyers by trying to hid competitors for optimal a space and timing of passion. Ich was the count Manager for Bren Salty Snacks with repubility for sulling to Super Saver The cateringen sam, called Category Aber work hand-in-hand with 16 buyers at retailers to make decisions that rest for the category asshole This scan reglarly interact with Act Managers, but ultimately is expected to make unbiased decisions that will on the total categy at that relates Churies as the Category Adviser from Breston's with responsibility for the Salty Snacks category at Supeaner Fiscal 2012 Salty Snacks category review At one of their bekly meetings, Alice told Charles that she would like to the chose lok at the sales numbers from l'iscal 2011, and to see which competitors to performahal and how he think they are likely to perform in 2012. Clarkspurala thorough analysis which showeil ikat Blud achieve youth in the Sally Snacks category in FH. hercas Breton's was only growing at. In addition, as Category Achser Clothes had Knowledge of new product lineup for both Brostaton B. M. Brestonew prod. Kintroductions or weak only allerung line extensions of their current home such as Salt de Vineyat Chips and Nutan Petc. BAN.on the other hand, saring ground- breaking products that are designed to introduce nenummers to the Salty Snackscate pory One of the main introduction. He was most excitala cu asa 100 Calorie Pota Chipluit find all the floor of regular potato chip was a fraction of the fait. This is an item But Alice was particularly excited about and is considering allocating a significant amount fue to all three ftason the plain or cream and onion and chostomatolof's 100 Caloric Packs Charles draft recommendations When it came time to allocate the space on the new Po. Charles place netow's to 12 SKUs. Jon from th 2017. a. Raluction in total SKLH Mad & taking all of that place in addition to all one in to regional 90 Tough decisions: something to snack on competitor, going from 10 SKUs to 15. With this change in shelf space allocation, B&M stood to gain significant ground in the share of the category in 2012. At the same time, in one of his regular meetings with Alice, Deke discovered that Alice was undergoing a Fiscal 2012 Review and Reset, and that Charles' recommendations would play a major role in the decisions. Upon retuming to his office, Deke gave Charles a call. "Breston's could really use some help with this reset. You know we've had a tough ycar, and it's only going to get worse if we keep bleeding distribution like this. I also know you were in the big product development session, so you know our R&D team is working hard on coming up with our very own 100 Calorie Packs ... You just have to give our folks a little more time. You do work for Breston's, after all, you know?" Charles hung up the phone and got to work on the POGs. He knows that he already has to answer to two companies and this situation is making it more difficult for him. He wonders whether he should revise his proposed recommendations to Alice. 5:32 at 5G Dashboard Calendar To Do Notifications Inbox 5:32 at 5G Dashboard Calendar To Do Notifications Inbox 90 Tought decisions: something to snack on competitor, going from 10 SKUs to 15. With this change in shelf space allocation, B&M stood to gain significant ground in the share of the category in 2012. At the same time, in one of his regular meetings with Alice, Deke discovered that Alice was undergoing a Fiscal 2012 Review and Reset, and that Charles' recommendations would play a major role in the decisions. Upon returning to his office, Deke gave Charles a call. "Breston's could really use some help with this reset. You know we've had a tough year, and it's only going to get worse if we keep bleeding distribution like this. I also know you were in the big product development session, so you know our R&D team is working hard on coming up with our very own 100 Calorie Packs ... You just have to give our folks a little more time. You do work for Breston's, after all, you know?" Charles hung up the phone and got to work on the POGs. He knows that he already has to answer to two companies and this situation is making it more difficult for him. He wonders whether he should revise his proposed recommendations to Alice. Questions 1. What should Charles do? Should he allocate the facings on the POG to maximize Super Saver's sales, as Alice expects? Or should he rework the POGs so that his own company, Breston's, can tum things around? 2. What are the short- and long-term risks and benefits of the decisions that Charles makes? 3. What are the potential personal risks and benefits for Charles? 4. Is Charles's personal relationship with Alice potentially affecting his judgment in this situation? 5. If Charles makes the decision to reduce the SKUs for his products, should Deke take any action