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Case Study 5-1:Vetements Ltee

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Case Abstract

Lisa D. Spiller, Ph.D., Christopher Newport University
Carol Scovotti, D.P.S., University of Wisconsin-Whitewater

It was a wintry morning in early 2005. Pat Overton, Marketing Director for McDonald Garden Center (MGC), had arrived early to review this year’s marketing plan. As she surveyed the greenhouse adjacent to her office, she saw rows of dirt filled trays coming to life with tender, green seedlings. The first buds of spring also triggered the arrival of the customers. Pat couldn’t stop thinking about all the decisions that had to be made … allocating the media mix … the future of the rewards program … growing the customer base. She decided to take a walk through the network of greenhouses and clear her mind before meeting with her promotions coordinator, Sherry Connell, and the team of associates that assist with marketing activities. Decisions would have to be made soon to be ready for the spring selling season.

This case provides an opportunity for students to deal with the variety of strategic and tactical issues faced by small retailers that continue to compete with the big box chains. Local and regional retailers’ marketing and media budgets are dwarfed by monies spent by Lowe’s, Home Depot, and Wal-Mart, the three top retailers of plants and garden supplies. To compete requires strong relationships with current customers and a commitment to ongoing innovation to keep existing customers and obtain new ones.

Retail sales of garden products are forecasted to grow to $40.8 billion by 2009. Steady growth is expected from 2005 through 2009, with overall annual sales increasing around 5 percent a year. Seeds and plants are expected to remain the largest sector, reaching sales of $12.9 billion by 2009.[1] All garden supply stores accounted for 21 percent of sales in 2004, down from 23 percent in 2003.[2] This

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...CASE STUDY 5-1:158 VETEMENTS LTEE Case Synopsis Vêtements Ltée is a chain of men's retail clothing stores located throughout the province of Quebec, Canada. Two years ago, the company introduced new incentive systems for both store managers and sales employees. However, the sales employees began to engage in activities that had an adverse effect on inventory management, employee cooperation, and customer relations. The store managers have tried, with limited success, to correct these problems. Discussion Questions with Suggested Answers 1. What symptom(s) exist in this case to suggest that something has gone wrong? • Employees stand near the store entrance, creating customer service problems, • Occasional conflict among employees over ‘ownership’ of customers • Some parts of store are left unattended, • Employees are unwilling to restock and reorder inventory • Employee morale has fallen, particularly in terms of poorer relations with the store manager 2. What are the underlying problems that have led to these symptoms? In other words, what theories explain what went wrong in this case? Expectancy theory Expectancy theory can be applied to this case to explain employee motivation to hoard customers at the store entrance rather than (a) attend to lower traffic parts of the store and (b) complete inventory duties. The E‐to‐P expectancy is likely least important because it is almost certain that any employee can stand near the front of the store to hoard customers. However...

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