Glibb Media Case Study

Statement of the Problem

Bob Harrell, national sales manager for Glib Media, has been approach by one of the media representative firms requesting an additional discount in order to complete a substantial order. Saul Libowitz, president of the New York media representative firm contacted Bob with a request to give higher discounts of twenty five percent on his media sales. Additionally, he requested a higher commission rate based on the higher level of sales from his New York firm.

Background/Situation Analysis

Glib Media is a national multi-media national company that had experienced a speedy growth in a short period of time. The company had both a strong internet and print media following so, Bob Harrell was charged with building a national sales force. Jugenheimer and Kelley note, "After much debate within the brick walls of Glib Media, Bob persuaded his management to establish a commission deal with existing media rep companies as a means of quickly ramping up a national sales arm" (p. 89). The five regional media firms were set up with a sliding commission on sales. In addition, Bob indicated to the firms that Glib Media would only offer a twenty percent discount on media to all their customers and would not negotiate a larger discount. Bob has previously experienced similar requests from other regions and has turned them down when additional discounts on sales have been requested.

Discussion of Alternatives

Bob has three alternatives from which to choose regarding the discount and commission percentages for his media representatives. The commission earned by the media representative firms has been based on a sliding commission scale; therefore, the level of commissions should not be an issue. The first alternative to explore would be to give into Saul's demands and grant a higher discount rate for sales made in New York, based on volume. While this alternative is one that would please Saul, it becomes an ethical dilemma by not offering the same percentages to the other firms. The next alternative is to turn down Saul's request for a higher discount and commission on sales and stand firm in the percentages already put in place. Saul should be reminded that the original percentages were outlined and would not be changing in order to accommodate larger purchases. The final alternative that could be pursued is reevaluating the discount rate previously set up among the five different locations and raising the rates to please the media representative firms.

Recommendation and Rationale

The best alternative for Glib Media to pursue would be in standing firm in the percentages set up for the five regional media representative firms. This is very important stance to take with the New York firm in establishing continuity among the different regions.