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Kranworth Chair Case Study

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Submitted By dcabral
Words 2503
Pages 11
ACCT 463/CCMA523
WINTER 2015
ASSIGNMENT 1
KRANWORTH CHAIR CORPORATION

Company Overview
Kranworth Chair Corporation (KCC) was incorporated in 1987 by Weston Krantsz and Kevin Wentworth. KCC is a manufacturing company, and the name of the Company is associated with FOLD-IT! brand that includes production of high-quality and fashionable portable, folding chairs and related products.
The main manufacturing line was concentrate to produce (i) folding chairs (produced at several price points) and related products (tripod stools, ottomans, costs, and stadium seats) in Mexico and China manufacturing facility and (ii) custom-designed products in the Denver location.
The main KCC’s customers were:
• Major retail chains (Wal-Mart, K-Mart, Target) that provided highest sales volumes but with lower gross margin;
• Other retail chains (e.g. sporting goods);
• Corporations for custom-design products orders.

From the begging of activity KCC was a Company that had little competition and high margin rate. However, since 1999 the Company faces some cash and business issues related to the new loan, the new competitors on the market and the worldwide recession.

At that point of time Kevin realized that in order to keep the business in good shape new changes should be done . This changes are to solve the main strategic issues the company faces, which include: eroding profit margin, fierce completion, inventory in more than a thousand types of products and parts and rather tight financial situation. Kevin realized that to handle all these issues, the company needs to better understand customer requirements and believed that decentralization could help KCC to achieve success.

KCC’s key decisions to reach the success
Identify the most important key recurring decisions that must be made effectively for KCC to be successful. In KCC’s functional organization, who had

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