UCC Case Study - Setting the Stage You are a team of marketing executives that work for UCC Company. UCC Company has been selling its industrial clothing across Canada for over 25 years. It has 4 employee sales representatives who work for the company, 3 are in Ontario and 1 is in Quebec. Market share is 24.7% in each of those markets. The company also has 9 independent manufacturer's agents, who are paid an 8% commission on sales, i.e. they draw no salaries or benefits from UCC. (summary of this info below) Direct Sales Indirect Sales 9 manufacturers agents 4 sales representatives (own salespeople - three in Ontario, one in Quebec) The cost of a sales representative in a territory (outside Ont/Que) would be $90 000 no commission. Only one representative per territory would be needed Currently paid 8% commission on sales, no salaries, no benefits. Agents sell other non-competing product lines. One complaint: requesting 10% commission on sales The 9 independent agents are spread across the country in different regions. The sales volume per region with market share is defined. In the table below is a summary of this information. Territory British Columbia Alberta Sask & Manitoba Atlantic Canada Total # of Agents 2 2 2 Sales S 886,458 $ 742,458 $1,244,553 $ 937,887 $3,811,356 Market Share 17.5% 13.4% 19.5% 26.3% 3 9 Using the information provided in this case, answer the following questions. Question One - 5 marks Based on current sales data, and using the current 8% commission rate, perform a territory-by-territory benefit to cost analysis. Repeat this step again assuming a 10% commission rate. Territory Sales 8% Commission 10% Commission British Columbia Alberta Sask./Manitoba Atlantic Canada Total Question Two - 5 marks What managerial decisions might you make as an outcome of your analytical results from question number one? Provide detailed justifications. Question Three - 5 marks Your market share has now increased per territory. Calculate revenue for each territory based on the same market share as you currently have in Quebec and Ontario at 24.7%. (You will need to calculate the market share per region based on this new information.) Territory Current Market Current Sales Share New Sales volume based on the new market share British Columbia Alberta Saskatchewan/Manitoba Atlantic Canada Total Question Four - 5 marks What ? UCC were to use their own sales force instead of manufacturer's agents and maintain the new market share across Canada as you currently have in Quebec and Ontario? Using the information from question three calculate the direct selling costs and compare that to the indirect selling costs assuming a 10% commission rate for the manufacturer's agents Territory Agents per Region Indirect selling costs Direct selling costs e.com 2 2 British Columbia Alberta Saskatchewan Manitoba 2 3 Atlantic Canada Total Question Five - 5 marks What managerial decisions might you make as an outcome of your analytical results from question 147 Provide detailed justifications for each decision