Rci Master Distributors

2278 WordsNov 15, 201210 Pages
RCI Master Distributor Evolution of Supplier Relationships 9/16/2012 Group 3 PHILIP CORRADINI (IE/15/009) KAMALIKA GANGOLY (PGP/15/019) S. SIDDHARTH (PGP/15/048) DEVINA BHASKAR (PGP/15/082) APOORVA GOYAL (PGP/15/130) MADHURI MUKHERJEE (PGP/15/155) AMARENDRA (PGP/15/202) DHANANJAY JANARTHANAN (PGP/15/216) GAUTAM S (PGP/15/277) S. HARIPRASAD (PGP/15/314) HISTORY OF RCI 1946 – Mark Schwartz founded a motor repair business and secured a GE franchise for component parts. He was instrumental in bringing about a service innovation by exchanging fully working motors with customers who came in for repairs of their broken down motors. He then repaired them and replenished his motor inventory. 1962- GE’s General Purpose Control…show more content…
c. The wholesalers were getting products at prices 5-17% lower than GE’s master distributors from GE’s competitors selling directly to them. d. Master distributors started losing share of sales to manufacturers selling directly to wholesalers. GE Motors hence decided to keep master distributors but proposed to sell directly to top 10 wholesalers, a proposal that would have given RCI a very serious blow. But RCI threatened GE motors to take back existing inventories with them, billing them for catalogue printing and distribution cost and refused any kind of repair service which meant end of the relationship. RCI had been in this business for a very long time and its innovative ideas were not being imitated by competitors as effectively as they could. The threat resulted in GE scrapping the proposal. This showcases the use of ‘Expert power’ by RCI owing to its expertise in distribution channel. This time around GE wanted to bypass RCI and remove its exclusivity by selling its products to WW Grainger who was a distributer/wholesaler (that too, a large one). This was esp. in the case of ‘design and control relay’ which had been mastered by Mark Schwartz for GE under the RCI banner. We could say this was GE’s display of ‘Legitimate Power’ as it was looking out for options which could have brought in more sales volume to GE. RCI established itself as a standard in low cost ‘lower end two pole devices’ - a #2

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