To: Chad Thomas
Founder Chad's Creative Concepts
Subject: Chad's Creative Concepts
Date: Jan. 07, 2015
Chad's Creative Concepts is a small custom furniture manufacturing company that has earned a reputation for innovative designs and excellent quality by focusing production on specialty designed furniture. Chad's Creative Concepts has grown substantially and has caused significant problems between standardized furniture and specialty designed furniture production. The problems concern ...view middle of the document...
Low running and high running furniture pieces are now competing for the same manufacturing capacity.
Chad's Creative Concepts has to emphasize the importance of on time delivery and manufacturing costs. Low running furniture pieces and high running furniture piece have a different set of priorities. Sales and marketing have not considered the conflict between dedicating equipment to standardized pieces and specialty equipment for custom pieces.
Producing standard furniture pieces has created significant growth for the company. The growth has also caused the cost of inventory and operational costs to increase. This has significantly lowered profit margins. The concern has been placed on manufacturing to reduce costs and increase production.
A pre-established plan should have been in place to control growth for Chad's Creative Concepts. The company has “outgrown” its manufacturing capabilities. The current limitations on manufacturing and the increase in sales growth may be catastrophic for future business. If Chad's Creative Concepts continues to miss manufacturing and logistical deadlines, competitors will be able to take business away from the company.