They started selling quality furniture, bedrooms and other things made of wood but in 1930 because of the Great depression they started to look for other market and products so the company could survive this economic situation that affect all the US. Because of this they started to fabric modern and office furniture and they became very success. They have sales of $1. 7 billion in 1998, $1. 8 billion in 1999, and $1. 9 billion in 2000. ASAL GmbH and ASAL Products, Inc. German company that have more than 60 years, they specialize in the office furniture business, as Herman Miller Inc.
The owner of ASAL GmbH Barnard Stier that is also the president. This company has three stores in the US where they have more than one hundred employees. ASAL GmbH had sales of DM35,000,000 in 1996 and has current sales of DM37,000,000. Problem As we all know the company basically dedicated to manufacture and market their products as you computer keyboards, chairs, desks basically that kind of office supplies. The main problem facing the company Herman Miller is that the german boy named Oliver Asel took a job with ASAL GmbH, after two years, Oliver decidio seek new horizons in America.
In the United Unidos Estados Oliver took a job with the office furniture dealer, Office Pabellon South Florida, Inc. This caused the problem that this company with the same spin that Herman Miller offered products with better market affordable price. Faced with the barrier of not being able to export their products to Europe. That’s why they had to create a different distribution channel also exported to other parts of the world. SWOT Strengths: +Their products perfectly fits the new EU health standards financial strength Weaknesses: + Distributors in Europe had their territories as well as ASAL, with their contract to buy the Aeron chairs in the US and sell them in Europe. This turned into a conflict of interests Opportunitys: + Visitors of the audited trade fairs, where often employees, which Rank highly in the company and can therefore introduce the product if convinced + Emphasis sustainability, a matter that gets more and more important and can improve the company’s image, if correctly promoted Threats: Antitrust Law have forced the company to pay fines in the past +technology has become more important, therefore the company has to adjust to keep up with their competitors Problem solution alternatives The international sales manager Vreni Sahli had now to decide what to do about the grey marketing in the German sector. By setting up a contract with the Florida based company from ASAL Products the subsidiary of the US company Herman Miller created a parallel distribution channel. This is used by the German company Herman Asal GmbH to buy the products cheaper than the official distributors in the European area.
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That creates tension which could be solved by the following possibilities. First, the company should check if it was legal to get into a contract between Gary Kemp, VP Office Pavillon and Oliver. It was clear for both sides that the company Asal Products, Inc. in Florida was just founded to work as a a pass-through organization. Therefore, the VP of Office Pavillon was maybe acting willingly or by accident against the company rules by selling products outside of the own market zone. He sold it within his zone but it was clear that the products would be shipped into another zone and tensions with other distributors would appear.
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Second, the head management of Herman Miller, Inc. should try to solve this problem in the very short term even by risking to break connections with distributors and customers which would lead to decreased profits in the short term. But in the long term the distribution channels would be clear and without interferences again. Also it would be possible to have a clear marketing direction and therefore planning is possible again in the future without interferences of the different distributors with each others.
That would practicably mean that Vreni should decide to get out of the contract of Asal Products, Inc. even when there would be legal problems. Moreover, the business relationships to this company could be worsened in the long run. Another alternative should be to create a plant in Europe so now they don’t have top ay all the taxes they have to pay so they can export their products, in that way they will be able to give better prices to their clients, and they will supposed to have a better service and more quality because they where the pioneers in those products.
The last alternative could be to create a better marketing about their products, to compare their brand with the competition so the market can understand that the differences between prices is because of the good quality, the brand name, the knowledge, and that they are the only ones, the expert ones on those kind of products. Finally we think that a great alternative also could be to open a new market, for example if the competitors are taking some of the market that they used to have when they where the only ones, they can create a new market, with new products focus on a market that they will not have some competitors.
