Coastal Uniforms Harvard Case Solution & Analysis

Coastal Uniforms Case Solution 


Coastal Uniforms is the company that has been running its operations unethically as employees are suffering from the unrealistic targets especially sales representatives. In this event, Andrew Vilas, a sales representative finds himself in a situation where he has to take decision which will have great effect on his job and company as well. The company has been putting pressure on its employees to meet the un achievable objectives as well as it treats its employees unfairly particularly villa has been facing difficulty in receiving his due bonus.

Company background

Coastal Uniforms is a public limited company, which has operations in the U.S. The company has annual sales of $200 million and has about 2000 employees on its payroll. Coastal Uniforms has been operating efficiently with steady growth rate from its inception. The resulted effect makes the shares of the company quiet valuable. The company has business units in Massachusetts, New Hampshire and Rhode Island.

The business activities include provision of work uniforms as well as subsequent uniform cleaning services to the manufacturing and services clients. The new addition to the business is the introduction of the flame-Resistance Clothing Division, First aid supplies division and Custom Apparel Division. These new divisions will target the luxury hotels and casinos.

Since 1999, the company started to face serious issues from the competitors as well as from environmental and economic factors. All these factors made it difficult for the company to continue its business in a profitable manner with annual growth. Thus, the company started using different tactics to preserve its financial benchmarks.


The trouble started-Competition

In the year 1999, company started facing business decline, majorly due to the loss of customer. The competitors, which previously did not recognize as threat to the business, wentinto negotiation and customer oriented strategy to steal Coastal’s customers. The company experienced null growth in the revenues and profit. This created chaos in the company, and it wasthe time to introduce major changes in the company strategies.

In this situation the company called up meeting in the start of the year 2000. The meeting decision forced the sales representatives to achieve the sales target which would be up to 20% more than the current target. The budgeting strategy here can be identified as top down approach. New selling techniques such as catalog items were also offered to the customers by the sales representatives.

Rising Prices

In the event of the rising prices, the company started to charge extra delivery charges to its customers, which was assumed to be because of the rising prices of oil but the charges prevails even after the oil prices comes to the normal level. Moreover, the customers who argued about this were given relief from such charges. This indicates the company’s weak policy and customer differentiation. The company, in order to lower it costs, started using low quality fabrics in its uniform manufacturing. Moreover, the company eliminated some add on features from the uniform. All these strategies helped to achieve at least some growth in the profit and revenues.................

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