“Sayonara” Mr. Saito – Goodbye Business!
Abstract
This case was written to point out the importance of entrepreneurial marketing, particularly for small businesses, and the brand extension along with the product life cycle. This is an observational field-based case study, which focuses upon Sand by Saya, a micro business that designs and assembles sandals in New York City with a worldwide distribution network. Sand by Saya lost its biggest Japanese buyer, Mr. Saito, due to weak sales of its newest product line, a line that was lower priced and poorly manufactured. The case ends with the CEO of the firm contemplating how she managed to get into this predicament, how she might have avoided it, and then what actions should be taken beyond legal retaliation. Part 2 includes a brief teaching note that provides a short description of entrepreneurial marketing, brand extension and product life cycle. The concepts are then applied to the case in order to understand some of the problems encountered by the firm and possible solution strategies. “Sayonara” Mr. Saito – Goodbye Business! It was early May and Sayaka was on the phone with Mr. Saito and her voice was serious, and so was the speech coming out of the receiver. Mr. Saito and his firm Aesthetics, starting in 2011, had bought $100,000 dollars’ worth of sandals per year. Mr. Saito and his importing company in Japan “Aesthetics” had become the firm’s most important business partner, when his firm started receiving orders from big department stores for Sayaka’s sandals. Aesthetics sold those sandals at summer pop-up stores in every major department store such as Barneys in New York, Japan, Isetan, and Hankyu. Mr. Saito bought sandals at a wholesale price from around $15 to $30 per pair and marked them up for a high profit margin (almost 300%) due to high tariff rates and shipping fees. This was Sayaka’s main buyer, her “Wal-Mart”, and she had to keep him happy. A call from Mr. Saito was always treated with the utmost care and received the greatest attention from the entire staff. When Mr. Saito talked everyone listened! Even though Sayaka was speaking softly and deferentially in Japanese, everyone in the room noticed that something was wrong regardless of seeming pleasantries. The translation of the phone conversation was approximately the following: ©Center for Contemporary Research www.ijbmcnet.com 11 Mr Saito: Anata niwa hontou ni shitsubou shimashita.1 I am very disappointed in you.