...SCHOOLS GRADUATE SCHOOL OF BUSINESS CASE ANALYSIS “O.M. SCOTT & SONS COMPANY” SUBMITTED BY: ESTIMADA, ANNA GABRIELLA C. Executive Summary The O.M. Scott and Sons company was a company which first started to produce weed-free grass, but diversified into other products related to its product line: lawn mowers, fertilizers, and other garden paraphernalia. It encountered the problem of nationwide distribution, finding difficulty in the delivery of its product. The company solve this problem of nationwide distribution by first, increasing its work force to keep up with the voluminous orders. Second, by setting up dealerships which will distribute their products and lastly, establishing a trust receipt payment system in order to assure the quick returns of investments. Problem The company encountered difficulty in the distribution of its products for two reasons: the nature of its agriculturally based products necessitated the quick distribution of products upon order. The voluminous orders and distances of nationwide coverage rendered the distribution difficult. Corporate Objective In keeping up with the modernization of agricultural products and technology, the company expanded its product line by diversifying into related products and services. From grass, O.M. Scott & Sons started the production of fertilizers, lawn mowers and other products. This diversification assured the company against stagnation. Areas of Consideration Shareholders &...
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...I. Exec summary O.M. Scott & Sons company is a company that processes clean, weed-free grass seed since 1868. Over the years, its product line has evolved into a wide variation of farm seeds and total lawn care systems. Between 1955 to 1961, the company implemented different programs to market and distribute its product with the aim to increase the company’s past success and growth. Due to these efforts, sales increased from about $10 million to $43 million. However, even with certain policies in place, results of 1961 operations showed that the company’s net income decreased despite the increase in sales. In late 1961, the company’s officials, with the numbers showing the results of operations, geared for the production year ahead. II. Problem Institutional What changes should the company implement to effectively manage its distribution channel, in order to increase market share and profitability Operational What changes should the company implement to improve its collection on receivables, manage inventories turnover, and marketing in order to increase profit III. Corporate Objective A. To be the market leader in grass, and farm seed industry B. To be able to implement effective marketing and sales programs through profitable product lines and effective distribution system C. To be able to effectively manage expenses in the distribution level IV. Areas of consideration Macro-Economic indicators Political The year 1950s was generally characterized...
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...Karen- Kimberly-Clark Case Study In 1872 four business men, John Kimberly, Havilah Babcock, Charles Clark and Frank Shattuck created a company called Kimberly, Clark and Company which initially sold manufactured paper goods. They would eventually branch out into personal care items in order to compete in a larger market with companies like Proctor and Gamble. In 1978, Kimberly-Clark introduced Huggies disposable diapers and were an instant success. In the mid 1990’s Kimberly-Clark merged with Scott Paper and found them in an unusual predicament, the merger did not go well, the integration of Scott and Kimberly-Clark was a rocky one that would lead to dissatisfaction on the part of most Scott employees and especially Scott’s senior management.[1] In 2002, Proctor and Gamble released a line of high end Pampers disposable diapers that not only was a substitute for Huggies, but also captured a large portion of Huggies market share. Around 2003, Kimberly-Clark decided to restructure the way that the company focused on business products. They chose to use a system of “grow, sustain and fix”, which split all products in to areas that needed growth, needed to sustain market share or items that needed to be reformulated. This system was a total failure and caused the company to take several steps back in market share in most of their areas.[2] Had Kimberly-Clark gone for a more product related divisional structure, it is possible that they would not have lost so much of its...
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...Laura Mosier SCM-Professor York Case study #1 “Scott’s Miracle-Gro” Scotts Miracle-Gro, the largest company in the North American lawn and garden industry, has reached a point in its existence to make a significant management decision. The company is considering whether to continue with insourcing its spreader products or switch to outsourcing in China. The solution lies in an analysis of quantitative and qualitative data comparisons and deciding which ideology would benefit the company in the long haul. When considering the costs it seems as though outsourcing would save a lot of money for the firm, however, we must think strategically. Thinking strategically means the long run, and using the statistics we were given we can estimate that the costs of outsourcing are growing quicker exponentially. Yes, the labor in China is cheaper but over a span of ten years wages are estimated to increase by 40 percent in China whereas in Temecula there is an estimated 3 percent annual increase, or approximately 30 percent over the next decade. The additional $8,000,000 freight charge when choosing to outsource would be the biggest expense. Over a span of ten years this is estimated to increase by 30%, almost 10.5 million dollars by 2017. The only area we would be saving on is the electricity costs (other than the obvious difference in the annual lease costs), but compared to the freight charges it is very little. The electricity costs in Temecula are due to increase only 25% (compared...
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...RUNNING HEAD: Scotts Miracle-Gro : The Spreader Sourcing Decision Unit 7 Scotts Miracle-Gro : The Spreader Sourcing Decision Kaplan University School of Business and Management MT460 Management Policy and Strategy David H Brose Professor: Zurick October 11, 2011 Introduction Scotts merged with Miracle Gro in 1995 to form the largest lawn and garden supplier to the do it yourselfer. The company started as a seed supplier in 1868, claiming to distribute a weed free seed. Scotts marketed fertilizer in the late 1920s. In 1930, they developed their drop spreader business and their broadcast spreader business in 1983. Synopsis of the Situation Scotts had developed an injection molding process that is more appropriate for their industry. The old process of “hot stamping” labels left a manufacturer expiration on Scotts product. The new “label stamping” process made for a more unique and efficient manufacturing process. Key Issues The manufacturing process required fewer employees to produce. The location of the manufacturing facility requires high paid production labor, leased facilities, and limited manufacturing capabilities. Define the Problem Scott manufactures their label stamped spreader in a state with expensive cost of living and more expensive realty. The cost of moving the manufacturing facility is unthinkable with the specialty equipment and training required for the product. ...
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...Scotts Miracle-Gro : The Spreader Sourcing Decision John Gray Michael Leiblein 1 As Bob Bawcombe drove to work on a warm California morning in June 2007, his mind was occupied with an upcoming meeting with the folks from the corporate office in Marysville, Ohio. Bawcombe was the director of operations of Scotts’ Temecula plant. For over five years, he had been in charge of the Temecula manufacturing plant, which produced all of Scotts Miracle-Gro’s domestic lawn seed and fertilizer spreaders (see Exhibit 1). As a result of the plant’s location in Southern California, Bawcombe was under constant pressure to justify why Scotts should not offshore/outsource production of its spreaders to a low-wage manufacturing site, such as China. COMPANY HISTORY 2 The Scotts Miracle-Gro Company (Scotts), based in Marysville, Ohio, was formed by a 1995 merger of Miracle-Gro and The Scotts Company. The merger made Scotts the largest company in the North American lawn and garden industry. It was the world’s leading supplier and marketer of consumer products for do-it-yourself lawn and garden care, with products for professional horticulture as well. 1 In the 2007 fiscal year, Scotts had net sales of $2.7 billion (see Exhibits 2 and 3). 3 The Scotts Company was founded in 1868 by Orlando McLean Scott as a purveyor of weed-free seeds. By 1879, Scotts had diversified into distribution of horse-drawn farm equipment and also started a mail-order farm seed distribution channel. Scotts...
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...1. Major issues （□drawbacks √advantages） Issues with Temecula Operations * High costs ( labor cost, overhead cost, raw material cost, energy cost) but were being improved * Redundant and labor-intensive process, low efficiency lay-out, but were being improved * In-mold labeling -- high quality (Hot stamping -- low quality) Issues with outsourcing to China * Scotts has to either provide the know-how of “in-mold labeling” or drop this feature. * Labor cost was low (√) but was expected to increase at 40% in the next decade. * Electricity cost was low (√) but was expected to increase at 20% in next decade. * Freight cost was USD 8 million and was increasing at 3% per year. * It had to keep safety stock of 8 weeks inventory ($460,000) to balance the increased lead time. * Contract manufacturer would take an 8% profit margin above costs. * Scotts also has to pay transaction cost and managing cost. * There would be a time-lag for quality reassurance in US due to the batch nature of suppliers. * Chinese government policy on Yuan remained uncertain. * Provisional agriculture product tariff-free policy existed (√) but later it might change. It seems that risks outweigh benefits. Analysis is provided below. This plan is NOT advisable to be taken. 2. Alternative solutions * Setting up a new plant in China ( mentioned in the article ) * Initial cost would be USD 8 Million and taking one year. * Benefits...
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...The Scotts Miracle-Gro Company (Scott) was the world’s leading dealer and marketer of consumer products for do-it-yourself lawn and garden care in addition to products for specializing in horticulture. Scotts started it spreader business according to “(Pearce & Robinson, 2011), with the introduction of drop spreaders and expand business in later years to develop broadcast spreaders. Scott’s Vision for the company future involved making the plant automated as possible and were headed in that direction.” Scott’s was trained and developed there human resources to meet the need for the future direction of the company. This direction would consist of fewer assemblers and a greater number of machine technicians to maintain plants. By making these changes the company would dramatically cut labor cost and make help balance out the difference and make the cost comparable to the cost of plants in China. I think the key issue with Scott’s growth and development wanted to maintain quality but, also it was important for the company to innovative and cost effective. A good example of this sort of process innovation according to “(Pearce & Robinson, 2011), was the development of a new hand spreader assembly process. Scott’s redesigned the spreader and removed screws connectors this allowed for a pressure fit. In addition to allowing the company to build an in house an automated assembly line which help to cut cost because less staff was needed. This process only required four people but...
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...ring , the best decision making model that the women should choose is by using the behavioral decision making model where this women is preparing for a job interview. This behavioral decision making model is apply when she have a dilemma either she should or should not wear a diamond engagement ring. This woman really want the job however, she thinks that the company has a stereotype perception towards her marital status whereby married woman cannot give the commitment to do their work in the organization. Therefore, this women should used behavioral decision making model to make a decision because she did not has complete information about the organization culture and whereby she need use her intuitive judgment as the situation she had face is not the routine decision. Case Study 2: Wellness or Invasive Coercion? In this case, the CEO Jim Hagedorn used classical decision model where he acting rationally to have a wellness program and anti-smoking campaign to improve health of employees and reduce health care cost for the firm. This case happens in Scotts Miracle-Gro Company, Marysville, Ohio that involved the Scotts human resources policies. There are complaints from employee where the policy is intrusive. The corporate executives are concerned about rising health-care cost to employee who fail to take extensive health risk assessments. CEO Jim Hagedom used classical decision model because of, he have complete information regarding dangerous of smoking that may lead to health...
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...A Case Study on O.M Scott & Sons Co. Table of Contents Objective……………………………………………………….…………1 Company Background……………………………………………………1 Ratio Analysis…………………………………………………………….1 Pro Forma Analysis……………………………………………………….3 Sensitivity Analysis……………………………………………………….3 Recommendations for Management………………………………………4 Summary of Case Study…………………………………………………..4 Appendix………………………………………………………………….5 Objective This paper will seek to analyze the financial statements of the O.M Scott & Sons Company during the years 1957-1961, in order to provide readers with a thorough understanding of the various factors that may influence the future success of this business. Additionally, recommendations based on an analysis of their financial statements will be offered for the management of O.M Scott & Sons to implement in the following years. Company Background Headquartered in Ohio, the O.M Scott & Sons Company has operated in the lawn care industry since 1868 and has grown into a successful business with a positive outlook. In fact, management within the company set an ambitious goal of increasing annual growth rate in sales and profits to 25% in the year 1959. According to management, one of the main factors limiting O.M Scott & Sons companies’ growth was the inability for their dealers to carry a sufficient amount of stock for customers. However, company officials feel that their use of a trust receipt program and other decisions will benefit the company’s current financial...
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...Inc was a company dealing with the manufacture of customized designed fluorescent light fixtures for commercial, and other institutional applications. This company was formed by Daniel Peterson and Julian Scott in 1956 in Flint, Michigan. Daniel was in charge of the engineering and finance sectors while Walters headed the Sales and design unit of the company. As the company grew, personal differences between the two emerged and Daniel bought out Walters from the company and brought in Richard Scott as his new business partner. Daniel became the treasurer of the company and Scott the company president (Adams & Spinelli, 2012, p. 385). The company grew tremendously to steady sales of about $1.2 million and a net profit of more than $18,000. Daniel’s son Jack Peterson and Scott’s son David Scott joined the company in 1983 and 1984 respectively and went on to take charge of the company as the sales and manufacturing managers. The management of the company was stained with a lot of differences and conflicts in the ways of running the business, with both Jack and David preferring different approaches for the well good of the company. As of 2005, the net sales of the company stood at approximately $5.5 million with an after tax profit of around $144,000 and an over 82,000 lighting fixtures shipped. The company had a total of 130 permanent employees with an additional 88 other employees working on an hourly basis. The differences between Jack Peterson and David Scott intensified...
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... I think of my brother Scott. He is currently and investment banker living in Manhattan but the path to that success was not easy. His character traits and dedication to hard work tell the story. Scott was born and raised in Brooklyn, NY. Like most of the kids he grew up with, they attended the local catholic school. When it was time to move onto high school, he was determined to attend the high school of his choice. He attended Saturday classes to help him succeed on his high school placement test. He achieved his goal by getting accepted to Xaviarn and Xavier, both were excellent, however, he chose Xavier. For Scott the travel was 2 buses and 1 train to get to school each day. Just as he studied in grammar school to attend the high school of his choice, so he studied in high school to attend the college of his choice. Scott was accepted to St. Johns and Loyola in Maryland and chose to go to Loyola. He attended school for one semester when he realized that living in the college dorms was not for him. He decided to return to New York and attend St. Johns. Scott began attending St. Johns full time when my mother started her own business. She needed help and Scott was intrigued. He had not held a true full time position with a weekly paycheck so he decided he would go to school part-time and work full time in this family business. The company was small but grew very quickly and Scott thrived as the lead sales representative. Scott also wore the customer...
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...Cultural dilemmas Monday Ahmad is a Malaysian employee in a large Australian mining company. He works in a department of eight people; three other Malaysian employees and four Australians. The CEO of the company is also Australian and his son plays in the same soccer team as Ahmad’s son. After meeting at a soccer game the CEO has invited Ahmad for a barbeque at his house. Ahmad is not sure what to do because he does not want to offend the CEO but he also does not want his Malaysian co-workers to think that he is getting special treatment. How do you think Ahmad’s cultural background is contributing to his feelings about this dilemma? What do you think Ahmad should do? How should he handle the situation? Do you think your own cultural background or ethical framework influenced your answer? Tuesday Kate is working in a multi-cultural team of six in an advertising company. Her team is a very supportive group and they all work very well together. Kate just finished putting together a very successful advertising campaign for one of the company’s biggest clients. Her team had a 3-hour planning meeting where they did some brainstorming and then Kate spent four weeks putting the plans into action. Her boss has just sent her an email saying that she will receive a large cash bonus for her work. Do you think that Kate should point out to her boss that she had help from her team before accepting the bonus? Do you think that Kate’s cultural background would influence her decision...
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...money to build libraries on college campuses. Said you should be disgraced if you die with money in the bank, though he himself died with $40 million in the bank. Signed a telegraph message with his bosses name, an unethical lie but turned out fine and his boss Scott approved of it. Being a leader in a difficult situation and making a good decision. He had told the truth it could have potentially changed his future. Tedlow criticized him for his attitude toward labor and employees. In the 19th centuries there are pitch battles and violence over working conditions in steel mills. They work long hours doing dangerous and dirty work. Carnegie’s attitude toward labor, during Homestead the strike that calls out troops. Henry Frick, no-nonsense guy that doesn’t deal with the union but suppresses it left in charge when Carnegie leaves for Scotland. Doesn’t have entirely successful labor relationships. The advantage to the business in taking the hard line in labor is to lower the cost of employees. Labor is a large part of cost and needs to be minimized. If jobs continue they will need to minimize labor costs. Another story is where Tom Scott the man at the railroad got him started at the higher level. Scott goes to Carnegie to ask for a...
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...character, Frances Flynn Benedetto, a nurse undergoes extreme domestic violence by her husband, Bobby. Bobby and Frannie’s relationship in the movie clearly demonstrate concepts explained in the textbook, Marriages and Families: Diversity and Change by Mary Ann Schwartz and BarBara Marliene Scott. In the text, Schwartz and Scott explain how women and girls are usually the victims in violent situations and the United Nations defined violence against women...
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