Corwin Corporation

In: Business and Management

Submitted By ahmadzeerak
Words 3678
Pages 15
By June 1983, Corwin Corporation had grown into a $150 million per Year Corporation with an international reputation for manufacturing low-cost, high-quality rubber components. Corwin maintained more than a dozen different product lines, all of which were sold as off-the-shelf items in department stores, hardware stores, and automotive parts distributors. The name "Corwin" was now synonymous with "quality." This provided management with the luxury of having products that maintained extremely long life cycles.

Organizationally, Corwin had maintained the same structure for more than fifteen years. The top management of Corwin Corporation was highly conservative and believed in a marketing approach to find new markets for existing product lines rather than to explore for new products. Under this philosophy, Corwin maintained a small R&D group whose mission was simply to evaluate state-of-the-art technology and its application to existing product lines.

Corwin's reputation was so good that they continually received inquiries about the manufacturing of specialty products. Unfortunately, the conservative nature of Corwin's management created a "do not rock the boat" atmosphere opposed to taking any type of risks. A management policy was established to evaluate all specialty-product requests. The policy required answering the following questions:

• Will the specialty product provide the same profit margin (20 percent) as existing product lines?

What is the total projected profitability to the company in terms of follow-on contracts?

• Can the specialty product be developed into a product line?

• Can the specialty product be produced with minimum disruption to existing product lines and manufacturing operations?

These stringent requirements forced Corwin to no-bid more than 90 percent of all specialty-product inquiries.

Corwin Corporation was a…...

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