Author Question: Eric thought his money troubles would be over after he graduated from college and had a real job.. ... (Read 188 times)

mpobi80 · **on:** Jun 29, 2018

Eric thought his money troubles would be over after he graduated from college and had a real job.. To his chagrin, however, he was close to maxing out yet another credit card. Suddenly he remembered that his company's bonus plan would triple his commission for the sales made after the first of the year. His money problems were overhe already had orders in hand with late-January ship dates. By holding these orders back and not turning them in until the first of the year, Eric could increase his commission and the customer would never know the difference.

Then Eric had a nagging thoughtwas he doing the right thing?

Should Eric hold back the orders until January to increase his commission? Why or why not?

Question 2

Jonathan was sitting at his desk eating his lunch when the phone rang.

Hello?

Hey Jonathan It's Matt, over at Anderson's Department Store. Remember those leopard print negligees that we thought were so hot?

Jonathan instantly recalled the negligees that Matt was referring to. The leopard print negligees were supposed to be the best sellers of the season. SureI know exactly which ones you mean, Jonathan replied.

Well, Matt began, I've reduced the price as low as I can go, and I still can't get them to move off the rack. They may be hot in New York, but out here they're just not selling. I need to return them to you at full cost..

Jonathan paused. He knew that his company's current inventory levels were too high, and returned merchandise would not be looked upon favorably. He wondered how he should respond.

Can Jonathan refuse to accept the returned merchandise?

Bigfoot1984 · **Reply #1 on:** Jun 29, 2018

Answer to Question 1

While it may be tempting to postpone the orders to increase his commission, the long run consequences of such a decision could spell disaster for Eric's career. While it appears from the role play information given that holding the orders would not adversely affect customer delivery, in the real world, things happen: orders get lost, snowstorms delay shipments, manufacturing equipment breaks down. If something beyond Eric's control would happen to this order, the customer (and Eric's supervisor) would rightly be upset.

Even if Eric is able to pull the scheme off without the customer noticing, there is always the possibility of his supervisor uncovering his plan. Eric would be caught lying and might well lose his job: making it even more difficult to pay his bills. Fabricating order dates to make more money is probably not a smart career move.

Answer to Question 2

While Jonathan might refuse to accept the return of the merchandise thus pleasing his boss, the long-run consequences may not be desirable. A better way to look at this situation is that both companies are in a dilemma and pushing the product back to either one doesn't really solve the problem. Perhaps Jonathan's best bet is to become creative and either find another buyer who might be interested in discounted goods or work out a compromise between the buying and selling companies.