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Section 2 Case Study: Saltspray Wipeout Saltspray was an old name in the Australian clothing industry. Started by its founder Jeff Masters back in...

This question was created from BUS176 Foundations of Management and Governance Exam 4.docx


how to apply motivation theory for this case.


Section 2 Case Study: Saltspray Wipeout SalEpray was an old name in the Australian clothing industry. Started by its founder Jeff Masters
back in the late 1980s, the surfing apparel label rode a wave of popularity due to its popular designs
and clever promotion strategies. Martin, a long standing employee of Salmpray said in the good old
days that, “Jeff was amazing... I remember early on when the retailers had never heard of us that
nobody wanted to stock our merchandise. So he talked to all his surfing mates and asked them to go
into these shops and ask if they stocked Saltspray. Pretty soon we were getting calls from retailers
saying ‘we can’t believe how many enquiries we’re getting for your product... can we please see some samples?” and ‘.. .how soon can you deliver?” Martin noted Jeff had always been a real "hands on” sort of leader who, “ out there amongst it
and had his finger on the pulse. He was young himself so he was pretty much targeting the same age
group he was in. So it was good product development informed by ’l-tnowing the market’ and some
hard work getting some brand recognition among retailers that got things going.” Martin noted back
in those days once Jeff got his foot in the door the follow up orders soon arrived. The designs were
popular among mainstream youth and the steady sales always attracted interest from retailers. Martin
continued his account of the early days of Saltspray for some time, obviously quite proud about the
part he had played in its success. However, it wasn’t long though before some of the company’s more recent problems were discussed and his tone changed. Times got tougher for Saltspray and a number of factors created a situation in which there was a risk
of Saltspray collapsing. Growing consolidation in retailing meant larger clothing retailers had the
capacity to make greater demands of labels like Saltspray. Small repeat orders were a thing of the
past and Jeff had to borrow heavily to invest in the plant and equipment to meet these larger orders.
Eventually, he even had to turn to licensed clothing manufacturers in Southeast Asia to make many of
his lines as he simply could not increase local production quickly enough. By EDGE—2001 Saltspray
had over ltJD-D employees in Australia with roughly two thirds of these working in the production
facility in Melbourne, while the others worked in areas such as Marketing, Accounts and Product
Design. Martin had been working in product design for a long time and had been its senior manager for nearly five years. He now reflected sadly on how his time there was nearing an end as he seemed almost certain there
was little hope of him continuing. He said regretfully, “There was a time we knew what the market
wanted so you could say design was one of our distinctive competencies. That’s no longer the case
and we just aren’t getting the orders needed to cover the debt repayments for our heavy borrowing
over the last ten years.” Martin now lamented that Jeff seemed unable to let his product development
team work without undue influence. “It’s a disaster and we’re losing good people cause they just can’t work on new products without Jeff stepping in and steering things himself. Every time new

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