This report addresses the issues related to the contract offered by the mass-merchandise department store.

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This report addresses the issues related to the contract offered by the mass-merchandise department store. The following recommendation is offered:

Do not pursue the contract with the department store chain.

Rationale

EFFECTS ON BUSINESS

Contracting with the department store chain will have several negative effects on the nature of the business. The core competency that has been established since the beginning will now change. The buyers will no longer use their knowledge and expertise to find genuine artifacts. Instead they must develop negotiation skills to deal with mass merchandising of replicas. Delivery, pricing, and quality will all have to be confronted. Tripling replica production means increasing the search for artisans with quality re-creations. This will change the scope of the business from procurement of artifacts to manufacturing of replicas. Because employees will not be able to use their area of expertise, quitting will become an issue. The distinctive competency will not be used in the replica business and therefore the contract should not be pursued.

EFFECTS ON CONSUMERS/MARKET

Collectors of artifacts take pride in their knowledge and interest of authentic creations. If the contract were pursued, it is possible that a collector may