Case Study: Analyzing Chabot Wallpaper Company's Challenges

This case study analyzes the Chabot Wallpaper Company, a private firm involved in the design, marketing, and manufacturing of wallpaper. The company faces significant challenges, including low inventory turnover, poor retailer services, and obsolete inventory, impacting its financial performance and customer satisfaction. The analysis examines the company's background, current situation, and the issues faced by its retailers. The report utilizes qualitative and quantitative methodologies, suggesting formulas, tables, and charts to analyze the supply chain issues and propose strategies for improvement. Recommendations include enhanced communication, sales forecasting, and improved retailer relations to address the challenges and optimize the company's operations. The case study highlights the need for effective supply chain management to enhance inventory control, improve service quality, and reduce obsolete inventory. The study also analyzes the requirement of postponement opportunities in the wallpaper supply chain.

Case Study on Chabot
Wallpaper Company

Table of Contents
I. INTRODUCTION........................................................................................................................3
Background.............................................................................................................................3
Understanding of the case......................................................................................................3
Current situation.....................................................................................................................4
Challenges confronted or problems need to be solved...........................................................4
Future plan..............................................................................................................................4
II. CASE ANALYSIS.....................................................................................................................5
Qualitative and Quantitative Methodology............................................................................5
Formula, tables and charts are suggested...............................................................................5
III. CONCLUSION..........................................................................................................................6
Your proposals........................................................................................................................6
Factors not considered in section II........................................................................................7
REFERENCES................................................................................................................................8
IV. APPENDICES...........................................................................................................................9

I. INTRODUCTION
Chabot is a private company who deals in designing, marketing and manufacturing of
wallpaper and its products are shipped across the country under its own brand. Chabot also
distribute licensed designs and privately labelled brands. This report covers the background and
understanding of the case. It describes the current situation which is face by company and
various challenges which need to be confronted and also a future plan or recommendation for its
growth. This case analyses the postponement opportunities in the wallpaper supply chain and
also needs a justification.
Background
Company has around 8000 stores and accounting for about 90% of sales. Zach Miller is
the CEO of Chabot and concerned about its supply chain practices. Company's annual sales and
revenues are approximately $200 million. Its retail outlets include hardware stores, mass
merchandisers, direct online sellers and home centres. There are various wallpaper companies
which have substantial market shares in industry. Therefore, Chabot's inventory levels are
increasing, financial performance is suffering and customers are not satisfied with the current
service. The various wallpaper manufacturers has decreased over the decades. Competition is
becoming intense between the manufacturers and they fight for the market share, purchasing
patterns and consumers preferences which impact wall coverings.
Understanding of the case
This case study describes the understanding of wallpaper companies and their
merchandising. It describes its supply chain practices and current services which does not satisfy
the consumers. This case study includes the discussion of mass merchants which evaluates the
wallpaper category and the consumer satisfaction which they receive from wallpaper
manufactures. It includes various complaints by retailers which are inventory turnover, services
related issues and the unproductive wallpapers which obsolete inventory. It also contain research
of consumer behaviour which affects the sales and trends. Research shows that the style of
wallpaper design which derives buyer behaviour and another one is the behaviour of consumers
which impact the availability of stock. It also discuss the manufacturing and distribution of the
wallpapers in the market.

Current situation
Currently, company is facing various critical situations in which they faces various issues
in their supply chain practices, their financial performance will also suffers and customers are
not satisfied with the current services. Companies concern is validate when they receive
disturbing letter and feedback from their customers. Their feedback suggests that their business
activities is in risk if there is no improvement in their inventory turnover and their funding for
non-productive inventory.
Challenges confronted or problems need to be solved
Chabot is facing various challenges and their retailers have three basic complaints which
are as follows:
Inventory turnover: Inventory cost of wallpaper is high as 50% and the store level is
unacceptably low. In general words, inventory turnover of overall wallpaper assortment ranges
from 1.5-2.0. Retailers will see that the figures will need to get double in order to meet their
productivity standards. In addition to this, some items meet turnover but most items do not.
Retailers services: Chabot does not introduce new pattern which is successful for the
capability which keeps the demand high. Retailers watch items closely and sales pattern is
exceed to the original forecast then orders will increase with the consumers demand.
Obsolete wallpaper inventory: In this complaint, retailers are in the amount of
unproductive which leads to obsolete wallpaper inventory that needs to markdown to move.
Furthermore, retailers get agree to introduce new wallpaper pattern to stay in touch with the
trends. Earlier, retailers have been willing to share this markdown with chabot but all the funds
markdown.
Future plan
To increase turnover, company needs to level its carrying cost on wallpapers which is as
high as 50%. Although some items meet the turnover standard according to this plan but most of
them does not achieve. As top 20% of items turns about 5-6 times per year. Company solve this
issue as to increase the initial store set of quantities by which they get time to manufacture more
wallpapers without creating stock outs but the retailers does not want to take this approach. In
order to cover the cost, company and the retailers are consider as a number of cost saving options
like consolidating order, long production runs and minimises the increasing orders.

II. CASE ANALYSIS
Qualitative and Quantitative Methodology
As per case study of Chat Bot Wallpaper company, it is clear that there is requirement of
proper analysis about supply chain management because there is issues in their production
process which results in major three issues i.e. level of inventory at store, improper service and
unproductive and obsolete wallpapers. This makes organizational performance downward and
they are not able to conduct activities in appropriate manner. This shows there is requirement of
restructuring organizational operations with the help of which they can provide satisfaction to
consumers. When consumers are satisfied, then possibilities of growth prospects for Chatbot is
more. There is requirement of complete and specific information about ways through which
problem faced by management of Chatbot can be resolved.
There is requirement of qualitative research method with the help of which best and
effective approaches can be used. With using qualitative methodologies, it is easy for making
business at heights and reduce rate of consumer's complaint. With use of qualitative methods, it
is easy and relevant for managers of Chatbot to understand about changes which assist in
understanding about changes through which operational efficiency can be achieved. With use of
qualitative approach, there is ease in using different factors through which effectiveness in
operations can be achieved. For instance: there is problem in supply chain of Chatbot Wallpaper
company, so when they are using qualitative approach for resolving issues, then it is easy to
understand it and interpret it.
Formula, tables and charts are suggested
There is requirement of improvement in supply chain management through which
consumer complaints gets reduced and it is easy for managers to perform their business
operations in better and effective manner. There is some specific manner through which supply
chain process of Chatbot wallpaper company can be resolved. Due to issue in supply chain of
organisation, there is problem in maintenance of stock at store, obsolete of wallpapers and
services to consumers.

(Source: Improving supply chain performance management, 2019)
From the above shown picture. It is clear that there is requirement of identifying KPI
through which target consumers can be set. There is requirement of cost calculation as well
through which after setting goals. With use of appropriate model of management through which
proposed budget can be analysed. When target is set and actions are taken to deal with it, then in
next step there is monitoring of operations. With monitoring, there is ease in analysing
information and fixing gap between set targets and actual outcome. At last, it is clear that report
is presented a framework which shows complete and specific information for improving supply
chain performance of overall organisation to deal with issue.
Illustration 1: Improving supply chain performance management

III. CONCLUSION
Your proposals
Being consultant, there is requirement of some successful strategies with the help of
which Chatbot can improve their their actions in better and effective manner. There are majorly
problem of proper supply chain management due to which improper inventory management, lack
of service to consumers, problem to retailer. In order to deal with issues, some solutions are as
under-
 There must be proper planning and communication with workers through which they can
perform their actions with proper awareness. There must be proper communication
techniques through which different departments can communicate with each other.
 Top level managers of Chatbot have to predict future sales with the help of past sales.
This assist in maintaining inventory properly and consumer's waiting time is less. There
must be regular meeting with retailers, so quality of services can be analyzed and in case
of any issue corrective actions have to be taken.
 There must be provision of taking feedback from consumers with the help of which their
satisfaction level can be improved. If there is improper service rendering from any
employee, then reasons behind it and proper training has to be provided to deal with
consumer's query.
Factors not considered in section II
There are some factors which are not considered above such as: proper market analysis,
factors which has to be considered while ordering, use of Economic Order Quantity (EOQ), etc.
with the help of which actual reasons of improper supply chain can be evaluated.

REFERENCES
Online
Improving supply chain performance management, 2019. [Online]. Available through:
<https://www.semanticscholar.org/paper/Improving-supply-chain-performance-
management%3A-A-to-Cai-Liu/8a24a5730e2381c8bb0f2bba91b1b0d7dc0d7dd6>.

IV. APPENDICES
Illustration 2: Improving supply chain performance management, 2019
(Source: Improving supply chain performance management, 2019)
Q1. major issues and problems that was facing Chabot
The crucial problems which was facing by Chabot is inventory turnover as their overall
figures does not meet the actual standard which is required to maintain their revenues and
income. Another issue is retailers services which obsolete wallpaper inventory, in this
unproductive wallpapers will increase which needs to be markdown but the funds gets
markdown.
Q2. recommendations to solve these problems
In order to solve these problems, company need to increase the initial store set of
quantities by which company get time to make more wallpapers without any stock outs. To
cover their cost, retailers will introduce many cost saving options such as long production,
minimizes the extra orders etc.

Q3. Is requirement of postponement opportunities in the wallpaper supply chain
No, there is no requirement of postponement of supply chain because if this action is
postponed, then there are possibilities that employees are not able to perform their activities in
better and effective manner. There is requirement of complete and specific information about
supply chain because this is connected with production, purchase and sales section of Chatbot.
Q4. Reasons of justified problems
Provided solution are justified because with the help of these mangers are able to perform
their operations in smooth manner. There is complete and specific knowledge to employees
about their roles and responsibilities. This assist in knowing what has to be done and actions for
which they are responsible.