please write case synopsis , swot porter five forces , alternatives and decision criteria

Read the case study and then follow the Marking Template to write your report in the space below. If you run out of space, you can go to Question 2 and continue writing. If you don't run out of space, you don't need to use Question 2. In February 2016, Don Roberts, director of Clairtone Inc, a small Hamilton, Ontario manufacturer and retailer of high quality headphones and headsets, had just met with a purchasing agent from 2001 Audio, a major Canadian electronics retailer. The agent had approached Roberts regarding the possibility of carrying a line of Clairtone headphones, which involved a potential order of over three times the number of headphones currently being manufactured each year However, during the meeting it became apparent that 2001 Audio had expected a price much lower than Clairtone was prepared to offer. Don was wondering if it would be possible to agree upon a price, and if so, was it in the best interests of his company to supply headphones to a large retailer such as 2001 Audio. As he left the meeting at the retailer's office, Don was aware that he would have to contact the purchasing agent within a few weeks. COMPANY BACKGROUND Clairtone was started in 1990 by Frank Roberts, Don's father Frank, an experienced sound engineer and electronics tinkerer, decided to specialize in the area of headphones for people with oor hearing (especially at the higher end of the sonic range of 16.000hz to 20 000hz), a market at had not been fully developed. Typically, as people age they become less able to distinguish sy high pitched sounds which can affect their enjoyment of music. Roberts originally concentrated a aol hoods of people will that had not been fully developed Typically, as people age they become less able to distinguish pecially at the higher end of the sonic range of 16,000 to 20,0001), a market very high pitched sounds which can affect their enjoyment of music Mr Roberts originally concentrated on custom made specialised headphones made to order, eventually expanded into high quality lightweight on the ear headphones and later headsets. As time passed, the headphones became his major rotasl segment Over the years, the company's image had evolved from catering to those who had lost some of their hearing range to one of providing high quality sound. As these products became more popular, Clairtone's reputation for value (good quality at a reasonable price) attracted a customer base that, while not very large, was loyal and was growing gradually In 2006, Don joined his father in the small family business, after studying Business Administration at Sheridan College One of the first things that Don did was set up a corporate website and begin to engage on social media. He found that these were good for attracting interest, but very little sales, as people wanted to try the headphones before purchasing The manufacturing and retail facilities were located in the same building in Hamilton. Two product lines were manufacturedClairtone, an over the ear headphone with custom moulded earpieces for mature adults, designed to "let you hear sounds that only young people can", and Booster, a headset for those who worked in call centres, but had hearing difficulties These lines sold in the company's own retail store and were also distributed to a small number of selected stores in southern Ontario. Other lines carried in the retail store but not manufactured by Clairtone included Klipsch, Bose, and Sennheiser, all imported from Germany, a country with a good reputation in high end audio equipment. The Company did not compete in the popular lines of headphones and earbuds made by companies such as Beats by Dr Dre, Skullcandy, or Monster TH 2001 Audio A representative from the 2001 Audio chain of stores had been impressed by a review for Clairtone in AudiophileReview.com, a leading high end audiophile blog and review website. Roberts was contacted, and a meeting was arranged at 2001 Audio's headquarters in Toronto in February 2016 The 2001 Audio purchasing agent expressed interest in distributing Clairtone headphones to all of their major retail stores and featuring it in their online store. First year volume was estimated by 2001 Audio to be as high as 20,000 sets. However, when the topic of price was raised, it became apparent to Don that Clairtone's regular wholesale price of $135.00 was totally unacceptable to 2001 Audio Although the meeting ended without a counter offer from 2001 Audio, Don got the impression that 2001 Audio wanted a price in the $100.00 to $110.00 range. It was decided that the two parties would be in contact in a few weeks when Don would send the agent several pairs of headphones for closer examination THE COSTING OF CLAIRTONE HEADPHONES The cost of a pair of Clairtone headphones consisted of materials, labour and overhead. Material costs included frame $12.50 per set The cost of a pair of Clairtone headphones consisted of materials, labour and overhead Material costs included frame $12.50 per set electronics 22.50 per set earpiece : 20.00 per set packaging 5.00 per set labour cost $25.00 per set, based on time studies overhead costs $25.00 per set, calculated as follows: overhead (fixed) costs of $150,000 per year divided by the current production level of 6,000 headsets per year. Although only 6,000 units of Clairtone headphones were currently being manufactured annually (about 500 pairs per month), production of 26,000 sets per year (over 2,000 pairs per month) could be accommodated by the plant. Don estimated that if production were increased to the level required by the 2001 Audio contract, the costs of gearing up production capacity, including hiring new employees, to the higher level would be about $5.00 per headphone set produced. Decision Time ne of Don's major corporate objectives was to increase the company's manufacturing activities, the plant was underutilized. However, he was not sure whether the contract with 2001 Audio as the hest way to do this He was extremely reluctant to lower his wholesale price, since he was One of Don's major corporate objectives was to increase the company's manufacturing activities, as the plant was underutilized However, he was not sure whether the contract with 2001 Audio was the best way to do this. He was extremely reluctant to lower his wholesale price, since he was already undercutting his major competitors by 20% On the other hand, he realized that a contract with 2001 Audio would allow the Clairtone brand to become established across Canada within a year. He felt that being carried by a major electronics store could enhance his company's image, and that it would be easier to deal with one customer with a large volume of sales. However, Don was also concerned by the prospect of devoting about 80% of his capacity to one customer. He might also face problems with his suppliers, especially the electronics, which came from Germany, shipments of which tended to arrive late At the current low level of production, this was not a major problem. However, Don was unsure how this problem would affect his company at the much higher production levels involved in the 2001 Audio contract He also wondered whether or not a high quality specialised headphone was suitable for mass merchandising, and what effect the possibility of a lower retail price by 2001 Audio might have on his own retail business and on his sales and prices through other retailers. In addition, expansion would mean the hiring of additional workers. s he drove back from Toronto to Hamilton, Don realized that his decision could drastically change ne nature of his company His initial reaction was that he could not afford to lower the wholesale ice, but he wanted to expand production and knew that $135.00 would not be an acceptable price 2001 Audio. Within a few weeks he had to contact the company, and wondered what he should