Rubbermaid

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Rubbermaid

• Meet Wal-Mart Demands and Invest Money!
• Brina Cissell

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Rubbermaid A brief history

• Enjoy a time of high earnings in the early 90s
• By 1994 net earnings topped out at 228 million
• Expected earnings potential to double by the turn
  of the century
• Ignore customer service
• Loss of Wal-Mart leads to a drastic change

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Loss of the large retailer

• Rubbermaids inability to meet delivery
  expectations
• 1995 loss of shelf space to other smaller firms
• Expense of software to tie in with Wal-Marts
  systems
• Questions arise about the necessity of meeting
  Wal-Marts demands

When you hitch your wagon to a star, you are at
the mercy of that star Matthew Schifrin
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Reasons to meet Wal-Marts Demands

• Rubbermaids very viability may depend on somehow
  gearing up to meet Wal-Marts service
  expectations
• Open international opportunity to Rubbermaid
• Rubbermaids products geared toward pedestrian
  household

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Rubbermaids very viability may depend on meeting
Wal-Marts service expectations

• 15 of Rubbermaids total sales in 1994 came
  directly from sales to Wal-Mart
• Loss of shelf space in 1995 resulted in a major
  earnings drop for Rubbermaid
• Forced a 9 facility and 9 cut of 14,000 employee
  base

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Open international opportunity to Rubbermaid

• Rubbermaid realized a need to move into an
  international market in 1994
• Wal-Marts announcement of expanding into the
  European market
• Easy access into international sales

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Rubbermaids products geared toward pedestrian
household

• Limited distribution strategy would not produce
  the sales volume needed
• Only megaretailers could provide the distribution
  and sales volumes necessary
• Other megaretailers could produce the sales
  necessary, but hold the same drawbacks as
  Wal-Mart and Wal-Mart was the biggest

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Summary

• Sales growth depends on Wal-Mart sales
• International sales made available more quickly
  with the large retailer moving to European market
  and taking products with it
• Impossible to maintain sales volume without a
  large retailer to sale from

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• Questions
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