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Question 2In what way(s) could he use e-commerce to grow his business?Question 3How much presence on the Web, if any, do you think Ruh should consider?Question 4What do you think will happen to this firm if it ignores the Internet?ANS:1.The Internet has both opened up opportunities for Ruh’s company as well as invited new competition. He can now sell his log birdhouse across the globe but so can his competition.2.A Web presence would allow Ruh’s company to sell products entirely through electronic channels. Consumers drawn to his Web site can view and order products without any direct interaction with the company. Advertisements placed strategically around the Internet (on search engines, Amazon, and related Web sites) could provide exposure unheard before the electronic age. Blogs and a MySpace page may also be helpful advertising tools.3.At a minimum, Ruh needs a Web site with product and contact information. He may be wise, however, to consider a fully functional, transaction-based Web site with a high level of carefully chosen Web marketing venues.4.Ignoring the Web would greatly limit the future growth of Ruh’s business. As competitors increase their Web presence, Ruh’s company would loose market share as people increasingly continue to make more online purchases. This does not mean, however, that he should not continue to use the more traditional forms of promotion. The Internet’s role in his business needs to be considered as one of several promotional tools available to promote Ruh’s birdhouses.PTS:1REF:p. 248OBJ:9-1 TYPE: C8.You Make the Call—Situation 3
A business incubator rents space to a number of small firms that are just beginning operations or are fairly new. In addition to supplying space, the incubator provides a receptionist, computer, conference room, fax machine, and copy machine. It also offers management counseling and assists new businesses in getting reduced advertising rates and reduced legal fees. One client of the incubator is a jewelry repair, cleaning, and remounting service that does work on a contract basis for pawn shops and jewelry stores. Another is a home health-care company that employs a staff of nurses to visit the homes of elderly people who need daily care but who cannot afford or are not yet ready to go to a nursing home.Question 1Evaluate each of the services offered by the incubator in terms of its usefulness to these two businesses. Which of the two businesses seems to be a better fit for the incubator? Why?Question 2If rental costs for incubator space were similar to rental costs for space outside the incubator, would the benefits of the services offered seem to favor location in the incubator? Why or why not?ANS:1.Assuming the receptionist answers the telephone, this service can be of value to both businesses. Having someone answer the telephone is usually superior to using an answering machine. It seems unlikely that either business would derive much benefit from use of the conference room or fax machine. No doubt the copy machine would