Cottrill, Inc., a corn refining outfit and industry leader in producing supply inputs for a variety of industries set out to reduce the level of working capital spent annually by $300,000. Judy Stevens, purchasing supervisor at Cottrill was generally granted autonomy in her department and currently was chewing over a proposal set forth by Saxton, a large wireless services company. During a trial of Saxton’s paging service there were some incompatibilities between Cottrill’s ProductionMessaging software and Saxton’s hardware. These snags required reprogramming and reworking of the pagers to establish connectivity and resolve the issue. Judy was unsure how this would impact buy in with the systems group and what the implications of these events would be going forward if she accepted the proposal.

Some issues surrounding Cottrill, Inc. are whether the proposal from Saxton is compelling enough to prompt a switch. While Saxton offers a cost structure that is only a fraction of what Tallant, Cottrill’s current supplier is offering for the 20 pagers they use, the savings pale in light of the money the company may have to spend to complete the switch. Furthermore, Saxton does not include guarantees that the low initial price offered won’t suddenly rise sharply after a time. The service issues Judy was experiencing with Tallant, Cottrill’s current supplier were more of a disappointment than an actual problem. Another issue lies with the systems group, they may not feel a sudden switch is warranted.

Additionally, there is an area of ambiguity surrounding Saxton’s proposal as to whether the company had the wherewithal to handle the technological requirements of Cottrill’s accounts. It is also unclear from the proposal if Saxton has any experience at all with in-plant wireless systems. Cottrill currently experiences one warning per week from the current paging system.