BUS 478 Lecture Notes - Lecture 9: Ikea, Goodweave International, Competitive Advantage

• School: Simon Fraser University
• Department: Business Administration
• Course: BUS 478
• Professor: Daniela Blettner

Document Summary

Decision: whether or not to cut off one of ikea"s major suppliers of indian rugs. Would disrupt supply and affect sales, but a tv station exposed the supplier for using child labor to produce ikea rugs (despite their contract forbidding the use of child labor) Pressure: pressure to join an industry-wide response to concerns re use of child labor in the indian carpet industry and pressure from a children"s rights organization to make the right decision. Use a label called rugmark to certify that rugs were not made using child labor. Created the competitive advantage of ikea which is that customers are able to look at the goods in person before buying and assembling at home by themselves, saving them 24310 in terms of delivery and assembly. Ikea"s competitors colluded to prevent ikea from attending trade fairs and pressured manufacturers not to sell to ikea. Therefore, ikea switched to a manufacturer from abroad.