International carpet wholesaler

CASE STUDY

Chloé LE GENTIL

Audrey MARAIS

Overview: Names & Position

Mr. James McHenry: buyer for International Carpet Wholesalers, located in New York

Ms. Paula Feldman: President of International Carpet Wholesalers, located in New York

Overview: Names & Position

Mr Abdelhadi Hachad: Managing Director of Societe Maroc Tapis (SOMARTA)

Overview: dialogue and exhibits

Dialogue : between Mr. McHenry and Mr. Hachad in his office to finalize the agreement. negociation about the delays, questions about the employees conditions, manufacturing improvement ..

Exhibit 1: Fax from Mc Henry to Ms. Paula Feldman (her boss)

Exhibit 2: Fax from Feldman to McHenry

Exhibit 3: Portion of a Letter send by McHenry to his wife

Exhibit 4: Note sent from McHenry to Mr. Hachad

Dialogue

Dialogue

Exhibit 1: Fax from McHenry to Ms. Paula Feldman, President of International Carpet Wholesalers

Exhibit 2: Telex from Feldman to McHenry

Exhibit 3: Portion of a Letter Sent by McHenry to His Wife

Exhibit 4: Note Sent from McHenry to Hachad

Note on the Moroccan Carpet Industry

Business Overview

Mr McHenry, a buyer in a large import carpet company, has nearly completed a major contract with a manufacturing company Moroccan carpet, SOMARTA.Mr McHenry provides wool at a great price to Mr Hachad.

Both parties are delighted, especially since a large order is scheduled for next year. However, Mr McHenry has just seen pictures of the plant, which despite impeccable maintains, shows girls as young as 12 years working. There are also some problems with the necessary quantity of wool and the price and their delays.

Problems

Employment of children

Delay for the wool import

Delay for the fabrication of rugs

Price of the rugs

Existing situation: Communication

Strengths Weaknessess- Mr Hachad has a fluent

English.

- Good reactivity in International Carpet Wholesalers.

- Good relation with Mr Hachad and with his boss, Paula Feldman.

- System of maalema, Mr Hachad didn’t know the crew of the maalemas.

- Importer of wool in Australia, difficulty to contact him.

Existing situation: intercultural differences

Americans Moroccans- Spirit of business, always

find the lower price.

- Contradiction for McHenry.

- Legislation on the minimum age for work.

- Very young population, half of the population is under 20.

- System of maalema.

- Legislation for the wool import.

Existing situation: Ethics

Strengths Weaknessess- The Government tries to

make efforts to increase educational opportunities for girls.

- The reaction of McHenry, he can’t contribute to the exploitation of children.

- Factory is very clean.

- Mr Hachad doesn’t control the maalemas’ employees.

- The age minimum is 12 years old.

- Every companies practice the same system.

Existing situation: management

Strengths Weaknessess- McHenry is very

independent in his work.

- Mr Hachad is ready to make many changes in his company to follow the command.

- Hierarchy problem with the system of maalema.

- McHenry failed lie to his boss rather than tell her the problem.

Statement of problems

McHenry is facing a dilemma:

Whether to turn a blind eye to the way of working of his suppliers in Marocco, or to oppose himself to these conditions.

# Option 1: Nothing change

Advantages Inconvenients- Not time or money

consuming

- Avoid a disagreement between Mr McHenry and Mr Hachad

- Allows to keep producing the carpet at lower price -> increase margin for Mc Henry

- Avoid Mc Henry to disappoint her boss with the deal

- Encourage young girl to work in factories according to the maalema system

- Mc Henry will be filled with remorse if he doesn’t act

- In an ethical point of view: bad for the image of the company

# Option 2: Audit the factory

Advantages Inconvenients- Ease McHenry’s

conscience about the young working girls

- Allows the company to know if the girls really are 12 years old or younger so that they can make a clear decision

- Ethical point of view: good for the company

- Cost money and time

- May lead to disagreements with Mr Hachad

- The deal might be canceled

# Option 3: Look for an other supplier

Advantages Inconvenients- Allow them to find a new

supplier without involving young girl

- Resolve ethical issues of the problem: company’s image not in danger

- They may find a deal even more interesting

- Time consuming

- They may not find an other supplier

- They may find a supplier with expensive prices or bad quality

- They may find suppliers with even younger girls or worst working condition -> more ethical issues

# Option 4: Change the production’s country

Advantages Inconvenients- Resolve the issue with

Morroco’s policy about the child labour

- They may found a country with prices even more interesting

- They loose Morroco’s opportunities: free tax with import on whool when they export rugs

- Prices will certainly rise in an other country

- The rugs quality may not be the same

# Option 5: Fire McHenry

Advantages Inconvenients- He will not worry anymore

about the young child working

- Time saving (they will not have to search for an other factory or audit one)

- Mc Henry has good relations with her boss and Mr Hachad

- Time consuming to find someone to replace him

- Hard to find someone as qualified as him

Recommendation : Audit the factory

The best thing seems to audit the factory in order to know if the young girl are twelve or not as Mr Hachad claims.

Analyze the working conditions of the employees, and reduce the bad habits. (force the factory to establish some break during the labour time)

THANK YOU FOR YOUR ATTENTION