Introduction
This case describes the situation of A-CAT Corp. The company was a mid-sized manufacturer and distributor of domestic electrical appliances, largely catering to the price-sensitive rural population. The firm operated two medium-sized facilities in a remote district in Vidarbha, India. A-CAT manufactured a wide range of electrical appliances including TV signal boosters, transformers, FM radio kits, electronic ballasts, battery chargers, & voltage regulators. The focus was on its flagship product that was VR500 voltage regulator. That were most commonly used as household protective device for TV and refrigerators from electrical fluctuations. Their target market was rural segment which were very price sensitive. The company offered nearly 100 different models of various electrical appliances for household use.
The A-CAT team planned to identify potential suppliers/vendors with their attendant strengths and weaknesses and to do forecast in a well-documented and structured manner.
Issues (symptoms) * One of the major issue that were prevailing for A-CAT that the market segment they identified for their products did not last longer and the downsizing trend in sales seems to get worse for the company. * The sales for voltage regulators fallen & the firm started deliberating on its purchasing policy & stocking spares & components in the system, in regards with stock in hand inventory. Prior to this all other products whose primary component was transformer were also hindered. * This also led to the bad relation with supplier who raised their prices, due to lack of uniformity & continuity in placing orders for transformers that were not guaranteed. * Placing order beyond limit also stretched the system. This led to the tie up of cash reserve for A-cat as well as exposed capacity of supplier. * Another major