Ch15 Article 1 - Small Business Enterprise: Co-op...

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Page 1 of 2 2009 Factiva, Inc. All rights reserved. Small Business Enterprise: Co-op Entrepreneur Makes Discounts a Business --- From Drywall to Bicycles, David Leppert Organizes Small Firms to Cut Costs By Jeff Bailey 899 words 22 October 2002 The Wall Street Journal J B4 English SOMETIMES THE LITTLE GUY doesn't even know he's getting a bad deal. But David E. Leppert knew. As a salesman for big manufacturers of drywall, the gypsum sheets used in housing and commercial construction, Mr. Leppert charged little drywall distributors as much as 7% more than he charged his biggest customer, an operator of about 100 drywall yards. Volume buyers, of course, usually get a discount. And Mr. Leppert didn't much think about the price disparity until 1996, when he decided he'd like to become a drywall distributor himself. Talking to some of his smaller customers, he discovered that their profit margins were razor thin, and that many of them didn't know that bigger distributors were buying at such drastically lower prices. "I rethought my plan," Mr. Leppert says. Indeed, rather than become one of those disadvantaged smaller distributors, Mr. Leppert decided to help them eliminate the 7% disparity. He formed Amarok Inc., a cooperative of smaller drywall distributors. And today, the co-op's 151 members, with combined sales of
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This note was uploaded on 01/26/2011 for the course MKT 337h taught by Professor Staff during the Spring '08 term at University of Texas at Austin.

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Ch15 Article 1 - Small Business Enterprise: Co-op...

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