Question

ETCETERA, INC.is a manufacturer of specialty key tags.

A Case Study in Quality Improvement and the FMEA

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Answer 1

Answer:

Etcetera, Inc. is a manufacturer of specialty key tags. They have a product line of metal and plastic key tags,some of which have standard symbols and messages; some items may be customized. Their primary market is college book stores and similar off-campus stores, and they produce their standard products with symbols for this market.

Custom products have standard symbols with additional messages; these are typically purchased by campus organizations to promote or commemorate special events. The company has been in business for 15 years, and has been moderately successful. There are 175 employees,120 of whom are in production or production-related jobs. The company has grown steadily over the years. It has developed a reputation among its major customers for timely delivery and good products at a reasonable cost. The company had $8,000,000 in gross sales last year, an all-time high.

The company is a family-owned business,but is considering converting to an employee stock ownership plan. There are rumours that the president and major owner is considering retiring within the next few years. The owners of Etcetera are considering diversifying into a less capital-intensive model. While their market has been good, they would like to hedge their investments. They have selected desktop publishing as a service to provide to the same market they now serve. This would involve publishing things such as newsletters, promotional publications, and small books that could be produced at low cost and sold profitably in small quantities. They expect their customers would be student organizations and small colleges that do not operate their own presses.

This diversification would be less equipment intensive than their present product line and would take advantage of their existing marketing network. This company is at a crossroads, and the management seems to recognize it. They are considering both expansion and major reorganization. They are also becoming concerned with competition. Since the product line involves relatively simple technology, it is certainly possible that competitors could become a factor.

Existing competitors tend to operate within the regions that they serve, so competition within a region is virtually non-existent. In fact, most of the competitors in this market act as if they belong to an exclusive club, and so far there has been a congenial and amicable relationship among the companies that share this market.