The Faraway Tree Collection

Work Tales - Life has been quite stressful and hectic for me these last few weeks. I have zillions of emails to respond to, tasks are piling up and my to-do list is just impossible!!! The 2011 Contract Season is here. It's been hard. Very hard. I really don’t know how to generate positive growth (double-digit) for this year negotiation. I don’t want to point fingers, I am sure Patrick have to do what he have to do at that time. The pressure that Iron Butterfly and Rufus have put on Patrick; I am sure it has been overwhelming on him at that point of time. If I were in Patrick’s shoes...I would probably do the same thing as well. It’s always easy to say just ignore the pressure but it’s actually very hard to actually to do it when the time comes. The market share for the furniture business is already so small and yet my predecessors decided to split them up and have 4 main players instead of the big 2. Letting in the 2 late entrants suppliers who contribute the least in terms of RBB and yet giving them to handle the most fast-moving sku business while the 2 original suppliers who pay the most money, only get a small pie of the share. It’s not fair. It’s not even on the same level of playing field. Putting aside the 2 big manufacturers in Malaysia and giving away the big business to a small manufacturer and a trading company does not make any business sense to me at all. I don’t understand where the logic is...asking the 2 big suppliers to pay for so much but in return such a small business that they are getting back from us. I guess everyone have their own reasons for what they do. And I don’t want to understand. All I know right now, is that the 4 contracts is out of balance and I am having a very difficult time to make things right. The 2 big suppliers wants a reduction in their contract for this year while the 2 small time players refuse to give more. Sigh...how am I going to convince, influence and persuade the 2 big suppliers to at least to maintain their A & P fund as per last year and to increase the budget for the other 2? Another big problem that I am facing is with the consignment suppliers who just refuse to increase their entry margin & back margin. So, no matter how good my outright business are, my overall commercial margin will be affected because these consignment suppliers value is too big. The more I do with them, the less profits I earned. And I cannot get rid of them either. I cannot buy sofas, bedroom set, mattresses on an outright basis because this will shoot up my store's stock days & stock value. Plus, my stores do not have sufficient storage place to keep these items. I cannot stop selling these items as well because they generate volume and they are big sales value to the department. And I cannot replace them with my outright goods because the outright value is too small and the company financial policy is to compare the sales LFL (lite for lite). My store team would rather push the sales of a sofa that cost RM1990 than selling 100 units of a RM19.90 folding chair. I agree with Juan Carlos that we should run our business on an outright basis, we should not let consignment suppliers to decide on our business. Again, my predecessors have run the furniture business in such a way: Outright 60%, Consignment 40%. Out of balance again. So, how am I going to at least to maintain the sales figures as per last year while reducing the outright vs consignment ratio? I'm just trying to get through this negotiation process as gracefully as possible without any drama :)