Case TELCO opened bookings for different models of its proud small car Indica in late 1998. The
consumer response was overwhelming. Most of the bookings were for the AC models, DLE and
DLX The DLE model accounted for more than 70 percent of the bookings.
Telco has planned to commence delivery of the vehicles by early 1999. However, delivery
schedules for the AC models were upset because of some problems on the roll out front.
According to a report in The Economic Times dated 13 March 1999. Telco officials attributed
the delay to non-availability of air conditioning kits.
Subros Ltd. supplies AC kits for the DLE version and Voltas is the vendor for the DLX version.
Incidentally, Subros is also the AC supplier to Maruti Udyog Ltd. Telco officials alleged that
Subros was being pressured by the competitor to delay the supply of kits. "If this continues, we
will be forced to ask Volfas to supply kits for the DLE version too, "a company official said
Case Questions
1) Why did Telco land itself in the problem (supply problem in respect of AC kits)?
2) If the allegation about the supplier is right, discuss its implications for the supplier.
3) Evaluate the ethical issues involved in the case. (Also consider the fact Maruti was 50 percent
Government owned).

Afreezer manufacturer might purchase sheets of steel, wiring, shelving, and so forth, as part of its final product. this is an example of what sub-classification of business market?

The sec has historically raised questions regarding the independence of firms that derive a significant portion of their total revenues from one audit client or group of clients because the sec staff believes this situation causes cpa firms to

Onsider the following subscription behavior information from genie, a web site that provides tools for constructing a family tree (ancestor search). subscriptions cost $9.99 per month, but you are charged for the entire year at the time of purchase. there is a one-year minimum term when you sign up for the service. once purchased, subscriptions are set to renew automatically unless the subscriber cancels them. when a membership renews, it renews for a one-year term and again you are charged for the entire year. there are no variable costs associated with providing this service to an individual customer, but genie does engage in customer relationship activities that they believe will increase customer retention. these customer relationship activities cost genie about $10 per year per customer. based on a sample of 1000 customers that joined genie five years ago, near the time when the company was founded, they were able to determine how many of those customers remained subscribers in the second year, third year etc. based on this information, genie calculated the average annual retention rate to be 20%. genie uses an annual discount rate of 8%. a. last year, genie spent $10,000 placing advertisements on google. genie management believes that these advertisements were responsible for about 300 new subscribers. would you recommend to genie management that they purchase more google ads? b. suppose a newly-introduced loyalty program increases the number of customers that remained to 30%. does this new data change your answer to 9.a? c. do you have any hesitations or concerns about making recommendations to management based on your above estimate of customer lifetime value?