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4. Study case Exhibit 9. It shows that about only 50% of its current customers are profitable to do business with. What should Ridderstrale do about the large number of unprofitable customers revealed by the account management system? Should sales representatives be allowed to accept an unprofitable order from a customer?

There are a number of ways to turn unprofitable customers into profitable customers before a company tries to get rid of those customers. Ideas include:

- Perform analysis of carrying costs versus manufacturing order costs to determine if it makes sense to stock more items than is currently done.
- Consider the possibility of offering order discounts to unprofitable customers to order fewer times a year, and in larger quantities than they currently do.
- Review the least profitable product lines and consider:
o Ways to improve manufacturing processes to improve efficiency
o Product design to increase margins
o Discontinuing the product line
o Selling......

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Approximate Pages: 2 (250 words per double-spaced page)

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