Problem
Taft's Department Store, an eight-unit organization located in New England, has been in business for fifty years. It is considered one of the most successful operations of its kind in that region. Through its many years of operation, it has continuously provided its clientele with the finest, most unusual merchandise available. To bring these items to the company, the buyers travel the globe and return with products that will be of interest to the clientele. Some of its merchandise, in fact, is available to no other organization within a three-hundred-mile radius. Customers seeking the unusual in both soft and hard goods come from great distances to avail themselves of Taft's offerings. With so much competition for the company, it is a credit to them to have met with so much success. For the past year, the company has witnessed a consider-able increase in its cost of operation. Management has held several high-level meetings to develop strategies to combat the higher cost of doing business so that they could remain as prof-itable as they have been in past years. Many suggestions were made, including consolidation of the business day, which would decrease the payroll; fewer customer services; and a substantial decrease in the promotional budget. Each senior manager was asked to digest the recom-mendations that had come forth at the meetings and sug-gest more appropriate measures. At the final decision-making meeting, it was management's consensus that a reduction in the promotional budget was the only solution. The other recommendations were eliminated from consideration. Against heavy opposition from the buyers, management argued that promotional dollars were available from many vendors and would make up for the deficiency in the budget. Their suggestion was to concentrate more on the companies that offer promotional cooperation. The buyers were asked to organize their thoughts concern-ing their opposition to management's decision and be prepared to present their reasons at a future meeting.
i. Are cooperatively sponsored promotions advisable for a com-pany like Taft's?
ii. Describe the disadvantages to the company that might result from too much emphasis on cooperative promotion.