4 Forecasting

Chocolate: The Road to Luxury

Posted on by spr1314mwilkes

MK-CD595_MARS_G_20130529181723

For all of you chocolate lovers out there beware: there may be a flaw in Western chocolate manufacturers’ supply chain management of cocoa. Productivity is not at the levels it needs to be to satisfy manufacturers and consumers. To better put this into perspective, Mars has found that if the levels of productivity remain the same as today, by the year 2020 there would be a shortage of 1.1 million tons of cocoa. If this occurs and current productivity levels of cocoa trended into the future, the cocoa farming business will not be headed in a promising direction.

The disconnect lies within cocoa faming itself. There is little incentive for cocoa farmers to continue in their line of work because of the competitive rubber industry. It is considered a less uncertain industry with a longer crop season by about four months. On top of this, the wage for both types of farming is roughly the same.

The other constraint of the industry is the high risk for disease outbursts. This is partly due to the inadequate access of much needed fertilizers for the cocoa crop.

Cocoa-farmers do not come anywhere near the crop’s capacity since their utilization is only around 60%. Cocoa manufactures have recognized the scarcity as a sincere problem since in many growing areas more than 40% of the cocoa crop is destroyed due to vermin and disease.  One would hope that this type of scarcity could be due to assignable variation that can be improved by subtracting bad causes.

How would you react if chocolate turned into a luxury good instead of an affordable snack due to flaws in the supply chain management?

Chocolate manufacturers are looking to provide solutions for productivity in the cocoa-farming realm. Many companies like Mondelez and Mars have invested millions in education programs in hopes to increase productivity and decrease disease-ridden crop. Mondelez has gone as far as hiring students from universities for these cocoa programs to target efforts toward younger generations. This seems to be an efficient approach, given the fact that peer motivation is a convincing form of motivation.

Another potential solution was Ivory Coast’s decision to set a price minimum for cocoa. This was an astonishing action that stresses how essential cocoa farmers are in the industry.

It is hard to believe that the issue has gone this far. In my opinion, action should have been taken much sooner. The uphill battle is much worse now that efficiency levels have sunk so far below maximum capacity.

Do you think that these efforts put forth by chocolate manufacturers will be enough to save the chocolate industry?

What else can be done to improve the supply chain management and productivity in the industry?

Have you noticed any other flaws in the cocoa/chocolate industry besides the supply chain management?

Which action will have a greater affect on the industry: a price minimum or cocoa farming education programs?

http://online.wsj.com/article/SB10001424127887324412604578513140098292744.html?KEYWORDS=operations+management+supply+chain

 

Beef Prices at an All-Time High a Good Thing?

Posted on by spr1313jmusolino

In the recent months, commodity prices have soared to record highs, with the sharpest increase being in the price of beef. The reason for this increase is partially due to last summer’s drought, but it is much higher than most analysts predicted. This has begun to affect the profits of large restaurant chains such as Burger King, Wendys, and most importantly McDonalds.

1C7301038-130509_angus_hmed_1213p.blocks_desktop_smallIn early May, McDonalds announces that it would remove its Angus Third Pounders from their menu. The company said the removal of this burger was done to make room for other food options, but most experts agree that the profit margins are too low for beef items like these to remain profitable.

This has resulted in McDonalds and other restaurant chains to begin to retool their supply chain to put a heavier emphasis on chicken products, which is more profitable than beef. McDonalds has already begun to roll out new items such as the premium chicken wraps. This will definitely be more costly in the short run, but with rising prices, and more health-conscious consumers, it is a good long-term strategy.

With obesity at all time highs, and consumers becoming more health-conscious, this rise in beef prices could not come at a better time. Chicken is much healthier that beef, having significantly less calories and fat. With chicken prices being low, this could benefit both the restaurants and the consumer.

This situation can be compared to gas prices hitting an all time high in 2008.  Once prices hit the high, there was a sudden demand for more fuel-efficient vehicles, planes, trains, etc. They use less fuel, are much more efficient, and produce significantly less emissions that harm our environment. Similar to beef prices, consumers had no reason to switch to the better option until it became cost-effective.

In any industries of this size, change has to be gradual. Switching from beef to chicken is easy for consumers. On the contrary, in order to fulfill demand, restaurants like McDonalds have to completely re-tool their supply-chain. Farms need to change their facilities to accommodate more chickens, processing plants need to change all their machinery, and restaurants need to change how they cook and prepare the final product.

I personally believe that this will benefit both the profit-minded producer, along with the health-conscious consumer. The fast food world is changing, and these companies know that innovation is essential to adapt to the changing taste buds of consumers.

What is your eating preference at these fast food chains? Do you think this rise in commodity prices is a good thing? Have you become more health-conscious?

http://www.nbcnews.com/business/wheres-beef-mcdonalds-dropping-angus-burgers-us-menu-1C9864163

Abercrombie & its Hitch.

Posted on by spr1313fmohan

Abercrombie & Fitch has been affected by a dramatic decrease in sales in the US. ANF’s stock had once been gaining 20%, when the stock market barely moved. However, everything came to an end on May 24, 2013, when ANF reported its earnings. ANF’s store sales declined 17%. Their shares then went down 8%. Even though they reduced their loss to $7.2 million from $21.3 million, it completely blew Wall Street’s prediction of $0.05 loss per share.

What could be the cause of these huge losses that Abercrombie is facing? Is it the result of CEO Mike Jeffries’ comments that resurfaced recently from a 2006 interview, on how the Abercrombie and Fitch brand don’t carry plus sizes for teens, because the brand exclusively only goes after the cool, good-looking kids? Or could there be something more?

Well, it turns out that Abercrombie started declining before the CEO’s comments reemerged this year. Even though there has been a lot of consumer out lash at the company, the CEO insists that the main problem facing Abercrombie is inventory shortage issues. Abercrombie hasn’t been able to bring in their spring merchandise quickly into the stores, compared to most of their competitors like H&M, who believe in fast-fashion. To gain a competitive advantage and to get back on their sales track, Abercrombie is changing the way they order their inventory, for a quicker turnaround. The CEO stated that most of their inventory issues have been resolved now, however, their sales profits forecasts has been lowered for the rest of the year, compared to previous years. With the company operating 1,053 stores currently, they also predicted to close 40 to 50 stores in the United States. Abercrombie has been acting really quickly on addressing key issues throughout their company to get their profits back up.

In class, we learned about the ten critical decisions which includes inventory management, then we learned about ethics and social responsibility and finally forecasting. Abercrombie’s situation ties in all of these things we’ve learned and teaches us how important these factors are in a business.

The company is now dealing with their losses and their shares plunging, just because of the inventory issue. Another issue, I think they’re facing is the social media. As a reputable company, they have a social responsibility to respect all of their customers. Ever since the CEO’s comments appeared in the media, many people have been fighting against Abercrombie (Examples: A man donating Abercrombie clothes to homeless, a plus size blogger posing in similar Abercrombie ads, a teen activist who petitioned for an apology from the CEO with 68,000 signatures). Do you think that Abercrombie is dealing with these losses solely because of their inventory management or because of the recent outlash at the company? Also, will Abercrombie  remain confident in their solid brand equity, when its competitors like H&M, American Eagle, and Aeropostale are attracting teens with their prices and fast fashion layout, bringing in new merchandise to the stores more often?

Source:

http://www.latimes.com/business/la-fi-abercrombie-earnings-20130525,0,6735405.story

http://www.chicagotribune.com/business/breaking/chi-abercrombie-earnings-20130524,0,3689716.story

Plus size blogger: http://abclocal.go.com/kgo/story?section=news/business&id=9113106

Video:

Man giving homeless people, Abercrombie & Fitch clothes: http://www.youtube.com/watch?v=TPmqZAhLVuI

No South For You! CTA approves plan to close South Side Red Line Branch for Reconstruction

Posted on by spr1323kobrien

imagesOn September 28, 1969, the southern part of the Red Line was completed for the first time. This section has been worn down over the years and 44 years later, they are in dire need of repair.  Yet, where does one start?  This is a tough decision to make.  In the eyes of an operations manager, the entire section of track is completely in shambles, and there are sections that need repairing.  Yet, even if that track is repaired, how much is it going to cost?   That is the question that the Chicago Transit Authority (CTA) had to ask.

There was a lot of work that needed to be done.  The tracks haven’t been fixed in 44 years and “the limestone ballast is worn [as well], failing to properly drain water from the rail bed or keep the tracks securely in place” (Chicago Tribune).  So, that has to be fixed as well because it wouldn’t make sense to fix the tracks if the supports wouldn’t hold them.  Working with Kiewit Infrastructure Corporation, the CTA approved a plan in April to completely redo the entire track section between Cermak-Chinatown to 95th/Dan Ryan.  This company will completely disassemble the entire supports of the old track system and put in new tracks as well as a new drainage system under the tracks.  The total cost of this will be $425 million dollars.

This project is expensive, but it will give jobs to 1,200 workers that will work in two 10-hour shifts for 6 days for a total of 5 months.   imagesCAVNHMYQ Once this project gets finished, the benefits will show.  With the new track system, the South Side Red Line Branch will be able to increase speeds from 15 mph to 55 mph, make a downtown commute to 95th/Dan Ryan 20 minutes shorter, and make the Red Line in general have a much smoother commute as well.   This process can clearly create efficiency for the Red Line as well as the other CTA trains.

Yet, devil’s advocate is that a good section of the Red Line is being worked on and the people who live down there have to take longer to get to where they need to go.  There would be also traffic tie-ups as well.  Behold option #2. With this first option in mind, there happens to be alternative plan as well.  It would have all the necessary adjustments done on the weekends, and would keep the train running during the week.  The bad news?  $75 million more and four years extra to finish.  In my opinion, the first option is the better offer, and in the end, it will help out everyone and it also appears to be the most efficient, which is what the CTA believed to when they made this agreement.  It will also save money and time in the future even though it would cause headaches and tie-ups now.

Do you believe that CTA  was correct to go with their first option or should they have tried the second option?

Sources:

Hilkevitch, Jon. “Red Line Going Offline during Reconstruction.” Chicago Tribune. Chicago Tribune, 10 May 2013. Web. 23 May 2013. <http://articles.chicagotribune.com/2013-05-10/news/ct-met-cta-red-line-south-rebuild-20130510_1_red-line-95th-street-stations-green-line>.

 

Reebok: Using CrossFit to Fire Up the Intensity

Posted on by spr1333cpassage

reebok

Many of us have heard of the fairly new workout brand CrossFit that has been sweeping the world for the past decade or so (2000). Some of you may even participate in the ultra intensified fitness regiments at your local CrossFit gym, or “boxes” as the growing cult has come to call them.  For those of you who are unfamiliar with CrossFit, it is an exercise program that advocates a mix of aerobic exercise, body weight exercise, gymnastics, and Olympic weight lifting that requires an individual to “to keep up the intensity, each and every time.” What does CrossFit have to do with total quality management within a corporate conglomerate you ask?

Well it just so happens that Adidas recently purchased Reebok back in 2006 and the company has been struggling mightily ever since the latter lost its decade long contract to outfit the National Football League last April to its biggest rival, Nike. This loss will reportedly cost Adidas an estimate of upwards to $250 million in lost revenue annually, a crushing blow to a company that was already being scrutinized for its purchasing of the floundering organization that had become Reebok. Reebok has also suffered heavy losses from lawsuits regarding their falsified health claims of their new “toning” shoes that deceived consumers. These allegations were brought forth by the Federal Trade Commission and required Reebok to pay nearly $25 million in total refunds. To top it all off, there has been turmoil within the infrastructure of the organization as an investigation has been prompted relating to alleged fraud by two former executives. However, there may be a silver lining yet for this once promising business transaction as Adidas hopes that sponsoring CrossFit using their newly affiliated business partner Reebok as its representative will not only reverse the current trend of posting a decline in sales the last three of five years, but also restore the brands image as a major powerhouse in the industry that is a force to be reckoned with.

adidas

Adidas continues to stand by there decision to purchase Reebok and hopes that their new two year deal with CrossFit will help them accomplish their goals that they set for themselves prior to their recent setbacks. In hopes of reaching the $3 billion objective for 2015, Adidas believes that their sponsorship of CrossFit will help speed up the process and provide them with some insurance they desperately need. The rapid growth of the CrossFit health craze is most certainly a positive sign for pulling Reebok out of the gutter as more than 3,000 gyms have popped up worldwide. The cult-like fitness routine seems it will continue to grow in popularity in the future as people gravitate towards the infectious atmosphere of the contagious motivation/energy and the promise of a complete workout in under 20 minutes. Will Adidas end up regretting their decision to purchase Reebok in the future? Or will the new addition of Reebok and the sponsorship of CrossFit pay off in the long run?

 

Source: http://www.businessweek.com/articles/2012-06-21/how-adidas-is-whipping-reebok-into-shape

 

Spirit Airlines: We Know You Hate It, But We Don’t Care

Posted on by spr1313zmares

Spirit Airlines is an American airline company that is known for having low-cost flights. The company is more concerned about the prices they give out rather than the complaints they are receiving. Spirit has been acquring their fair share of criticism from customers and the media. A survey was made of some 16,000 customer ratings and Spirit Airlines was among the bottom of the list for flying in America. “That report did not ask the one big question of who offers the best prices. And hands down, the No. 1 thing we’re told by our customers is that the price matters,” says Spirit spokeswoman Misty Pinson. Let’s be honest, would you complain about a flight that is two and a half hours long and only cost 75 bucks?

Spirit AirlinesThe company strives to make the price for flights as low as possible. They have an average base price of only 79 dollars. One thing that customers hate about Spirit Airlines is the fact that they charge fees before and during the flights to passengers. These fees can add up to be 40 to 50 dollars for the majority of customers. Spirit Airlines does not even offer a free cup of water or have a video system while the passengers are in flight. There is not much leg room either so you are cramped, regardless of how short you are.

The airline company believes that is what the Spirit customers want when it comes to this airline business. Spirit believes they have travelers who would most likely be getting a bus seat if their airline service was not available. The Chief Executive Officer Ben Baldanza says, “Well, what we say is that we care about what our customers care about, which is price, and one of the things that Consumer Reports survey didn’t ask is where do you get the lowest fare? And so they asked about leg room, and they asked about check-in, and they asked about bag fees, and things like that. But the total price that customers pay on Spirit Airlines is less than they pay on anyone else, and that’s why they love us.”

Spirit Airline company should not be upset by all the criticism coming their way. Spirit is a very solid business as their sales rose 23 percent in just the past quarter. The planes are fuller than the rest of the other airline companies. The company has a rate of 85.1 percent in the first quarter  of 2013 when it comes to flights being full. That makes the company really profitable as they move forward.

The airline company still gets a lot of negative feedback from the press even when they are succeeding. So, is it fair that Spirit Airlines is getting this terrible assessment from the media when they are making profits and almost all of their flights are full? Does the base price really trump all the niceties that other airlines offer?Or should management try to improve their baggage fees and legroom in the flights in order to please the customers more?

Links:

http://www.businessweek.com/articles/2013-05-23/spirit-airlines-doesnt-care-if-you-hate-it

http://money.cnn.com/2012/05/03/news/companies/spirit-airlines-fees/index.htm

http://aviationblog.dallasnews.com/2013/05/spirit-airlines-ceo-we-have-the-lowest-prices-and-thats-what-customers-care-about.html/

“Lets Cap Up!” -Ford

Posted on by spr1323rpogorzelski

Ford has increased their production capacity for the second year in a row in order to meet their production demand for their cars, trucks, and utilities. The Chicago assembly plant, one of the many plants included in the plan, will play a critical factor in the company’s production capacity who seeks to increase total production by 200,000 units. It seems like the company will for now only focus on their more popular automobiles which include the Ford Explorer, Ford Fusion, and the Ford F-Series. Ford plans on increasing the production capacity by only allowing one-week summer shutdowns which in turn will produce 40,000 new units. Currently Ford’s stock is listed at $14.49 per share, while General Motors is trading at $32.87.

General Motors is also planning on increasing their production capacity, however they are focusing on introducing 23 new cars and trucks to their automobile portfolio. Ford states that the company is planning to add 1,300 hourly jobs this year alone and it is planning to offer 12,000 hourly jobs by 2015. Ford’s revenues increased 10.5% to $35.8 billion.

The automobile industry has been considered America’s backbone for many years and we have heard of the struggles it went through especially during the recent recession with needed government aid. I understand that the industry as a whole is looking to increase capacity however Ford has not mentioned any new automobiles to be added as part of the plan. We have all heard of the phrase, “just because everyone’s jumping off a bridge does not mean you have to.” I believe that this is a risky move for Ford with what they plan on doing with their production right now and we all know the costs that run along with production and storage.

The company states that in plans to increase hourly jobs. However, adding these hourly jobs does not completely mean that hourly workers would be able to work full-time hours. The company has yet to declare whether or not these workers will be working full-time and the type of benefits they would receive. I believe Ford is eager to increase their production due to what other companies are doing and because of their recent growth. However, in the automobile industry, bad forecasting can be very costly for many reasons. For example, if revenue drops for the next year or two, then the company is stuck with a large number of vehicles in their storage centers. No company wants to report new hiring and then go downhill with reported job cuts and firings after.

In Ford’s case, is it too soon to increase this production capacity and plan on new hires? Does one good fiscal year call for changes in operational management for next year? And quite frankly, can Ford compete with the innovation that General Motors is adding to their portfolio?

 

Source: http://finance.yahoo.com/news/ford-enhances-production-capacity-141502358.html

Retail to E-tail

Posted on by spr1333rmortha

There are a lot of pros and cons to doing online shopping as opposed to in-store shopping. Online shopping seems like it only affects consumers by giving them a different medium to make their purchases but we fail to realize that it affects the sellers as well. Through online purchases, businesses gather a lot of data about consumers. Sellers can track which sections of items are the most popular, which products are the most viewed and for how long, and which products are most browsed at but not bought. This gives online sellers a competitive advantage over in-store sellers as they know more about their customers. And everyone knows that the understanding your customer is one of the most important factors in having a successful business. This is empowering in-store sellers to seek e-commerce level data.

The article talks about one company that brings customer tracking data to in-store businesses. This is in hopes of slowly bridging the competitive gap between in-store purchases and online purchases. How can they possibly get consumer data without changing the in-store purchase process? By simply observing the customers! Prism Skylabs specializes in in-store surveillance equipment that tracks customer movement. Prism installs special cameras that captures everything in the store and then is sent to the store’s computers where it is processed by Prism’s special software. The images of the actual shoppers are cut out to respect their privacy.

What is so different about Prism’s techniques than regular surveillance cameras? Prism’s software allows them to “look at which products are hot, which are being moved around and touched, and all kinds of data that allow merchandise teams to understand what is going on across a wide range of stores”. This allows the sellers to get information that the type of information that online sellers use to enhance their systems to get more purchases.

Who is using Prism? Right now, Prism has partnered up with 30 retailers. Retailers that Prism is working with include T-Mobile and Famous Footwear. Does it actually work?  A candy store in Oklahoma City was using Prism in their stores and after close observation they changed their premium display to low-selling seasonal candy rather than their famous candies that buyers usually take the time to look through the store to buy. This allowed the store to quantify the customer’s thoughts and make an effective decision in their operations.

Moreover, Prism is not the only data providing company that is emerging. Other companies are picking up on the importance and building unique strategies and techniques to sell to businesses. For example, Shopkick is an app which personalizes deals for a customer in real time as they walk through the store.

Is it worth it to sellers to invest in these data gathering companies?

How do you feel as a consumer towards this type of innovation? Do you feel that you will be making more beneficial purchases or do you feel manipulated by the sellers to buy their preferred products?

Link:http://www.businessweek.com/articles/2013-04-25/to-catch-up-with-e-tail-tools-to-track-shoppers-in-the-store

Airline Industry Summer Strategy: Have lessons been learned?

Posted on by spr1313aperrotin

“As an airline, if you’re not excited about summer, you’re in the wrong business,” said Mike Van de Ven, Southwest’s chief operating officer. In other words, if you cannot handle the heat get out of the kitchen. This summer, airport crowds are expected to be the largest in the U.S. since 2008. In 2012, all airline flights including regional had an average 76.1% on-time flight arrivals (flight stats analytics WSJ). That will not “fly” this summer.

image_security_linesWhat method of forcasting informed Airlines that airport crowds are expected to be higher than recent years?

United had a terrible summer last year—only 67.9% of flights arrived on-time in summer months. Customer complaints soared. The airline blamed computer system problems related to its merger with Continental Airlines and an attempt to schedule planes and crews more tightly. The plan backfired because it created longer delays and widespread disruption when tighter schedules couldn’t be met. The use of Gantt charts to schedule turnover time is a simple strategy Airlines use. They are constantly coming up with new ways of speeding up this complex process. Southwest does not have to purchase many Airlines because of how fast they can turnover planes. They plan to use spare airplanes this summer to accommodate stuck travelers more quickly. Southwest plans to routinely keep operating late into the night rather than cancel flights on stormy days. This is a contributor to why Southwest is a leader in customer satisfaction.

What is a disadvantage to scheduling each project to tight with each other?

United says they are better prepared for summer because it has more staff and better scheduling. In addition, the airline has rolled out new graphics screens for its computer system to make it easier and faster for airport agents to use. United also is introducing new boarding lanes at gate areas. Five different boarding groups will line up in different areas, similar to how Southwest lines up customers by groups, so that each group will have a designated place to wait. A brilliant new seating system is set to take off. The coach cabin will board window-seat passengers first, then middle seats, and aisle seats last. With the “Wilma” system, as United calls it, seats fill faster because people already seated don’t have to get up as much to let a row mate in.  Now there are more reasons than one to get an window seat.

The industry as a whole have made changes that fliers should be aware of before making travel plans. Budget cuts in Transportation Security Administration overtime will likely lead to longer security-screening lines. Make sure travel plans are set in stone because domestic ticket fees change  to $200 from $150, and international change fees went to $300 from $250. United Airlines, Delta, American, and US Airways collected a total of $2.3 billion in reservation cancellation and change fees last year, according to the Department of Transportation.

Will higher change and cancellation fees persuade fliers to book with other airlines?

What may be the reasons Airlines raise these fees? http://online.wsj.com/article/SB10001424127887324659404578499162528986162.html?mod=WSJ_hpp_LEFTTopStories

Who said you can’t have it all?…. in the back seat of your car!

Posted on by spr1331acorvera

Mercedes Benz, also known as one of the long-held ranked luxury brands in the auto industry which lost its title of N0.1 in 2005, is focusing on its biggest market, China, to get their N0.1 spot back. The Chief Executive Officer Dieter Zetsche of Daimler realized there was a problem while leaning back in the rear seat of a prototype S-Class sedan in 2010. Zetsche realized that the seat did not incline far enough to fit the needs of the wealthy consumers accustomed to spacious airline seats. There is a reason behind him comparing the back seats to an airline seat, S-Class owners generally experience their car from the “second row”, which in China is very common where luxury cars are mostly driven by chauffeurs and not the actual owner. I believe this quality problem of the back seat could have been avoided if engineers were not focusing on the driver seat position so  much but in the overall car.

benz

The S-Class has been the leader, without a doubt, in luxury sedans since it was first introduced to the market in 1972. Because of heavy import levies, Mercedes is allowed to charge more than rivals for its cars in China, which can costs as much as $486,000.  This is a way Mercedes Benz can keep a good reputation when it comes to its image on their cars. The S-Class, as said by August Joas the head of the global automotive practice consultant in Munich, stands for luxury, prestige, comfort, and safety. All of these characteristics of the car can be easily measured by the quality ranked by previous owners. Mercedes Benz must maintain a good ranking on all of these aspects to continue holding the leading position of the luxury brand.

After thinking deeply about what China consumers will enjoy in the back seat of their S-Class Mercedes Benz, it was time to get to work.  Zetsche had his designers create a one of a kind back seat that reclines to a 43.5 degree angle which was available as an option on extended-wheelbase versions of the S-Class. Zersche thought about the comfort of sleep in the back seat, so they made the front passenger seat in a way where the seat slides forward to add legroom while the backrest recedes in a recess illuminated by ambient lighting for a more relaxing feel. In addition,  a calf support swivels forward and a heel rest pulls out of the front seat. And because a bed like back seat with relaxing features such as dimmed lighting wasn’t enough, they added a hot-stone massage function in the back part of the rear seat which can be used for long drives.  At this point it’s tough to even think about how safe this would be if the car was involved in an accident, but because everyone must follow  safety regulations, including ISO certifications, there was a special air bag to prevent passengers from sliding  under the seat belt during an accident presented in the image below.

comp_mercedes21__01__630x420 (1)

Well-heeled Chinese, who account for more that half of all S-Class sales worldwide, are critical to reviving the Mercedes brand. This will remain Mercedes biggest focus, targeting wealthy consumerss in China. Mercedes will continue offering additional services to impress more consumers along with building trusted relationships with current customers to remain brand loyal. They offer perks such as a 13 seat movie theater, located in Shanghai, along with a cigar room, and an in-house tea artist. Management has taken different routes to attract and keep their wealthy consumers, especially in China. The bottom line is that wealthy Chinese buyers will continue to account for more than half of all sales of Mercedes S-Class cars.  That being said, why not focus on making this group of consumers happy? After all, they are who are keeping the brand so exclusive and popular in China.

 

 

 References:

www.businessweek.com/articles/2013-05-16/mercedes-revamps-the-s-class-to-lure-chinas-wealthy-buyers

www.mbusa.com