Calyx FlowersEssay Preview: Calyx FlowersReport this essayCalyx and Corolla Case ReportIntroductionCalyx & Corolla was a new entrant into the $8 billion flower industry in the United States in 1991. Through the use of overnight air freight (Fed Ex), information technology, an 800 number, and a catalog, Calyx & Corolla was able to bypass three layers of distribution and provide fresh flowers directly from growers to consumers. As a result of their efficient distribution system, Calyx and Corolla changed the way flowers were distributed to consumers.
Strengths and WeaknessesI. StrengthsA. Good niche and mission. Calyx and Corolla filled a consumer need. Consumers wanted very fresh and long lasting flowers and the company delivered it. Efficient distribution was the key to flower industry and the company was able to shorten delivery to customers by bypassing the middle distribution layers, and provide much faster deliveries than traditional FTD deliveries. For example, Calyx and Corolla delivered roses from growers to consumers within 1-2 days of purchase order compared with one to two weeks for other FTD retailers and florists.
B. Sales growing at a faster rate than cost of goods sold. Projected FY4 and FY5 also had projected sales growing faster than cost of goods sold. See graph for details (Derived from Exhibit 1).
Growth rate 1988-1989 to 1989-1990 Growth rate 1989-1990 to 1990-1991 Growth rate FY3 to FY4 Growth rate FY4 to FY5Sales 4.31 1.55 .49 .61Cost of goods sold 4.14 1.52 .42 .58C. Good creative catalogs that have appealing photographs, as well as educational information.D. High customer satisfaction. From Exhibit 2, customers showed genuine satisfaction with Calyx and Corollas products and services.II. WeaknessesA. Business depends very critically upon Fed Ex. If Fed Ex had a major disruption to their delivery system, flowers would not be delivered on time, resulting in dissatisfied customers. For example, if Fed Ex employees went on strike, there would be no alternative equivalent to Fed Ex to deliver flowers to customers. UPS, although an alternative, did not deliver perishable products in the same timely fashion as Fed Ex.
B. Government Accountability and Financial Stability Board The Fed Ex. is the only source of Fed Ex. information on financial market conditions. If GABS is included in the GABS calculations, a lower number of low monthly payments of government institutions are expected since the Fed Ex. does not have access to information on U.S. Treasury bonds.
C. Market Risk The Fed Ex. must take prudent actions to stabilize the underlying assets of the Federal Reserve System and the financial system in the event of a strong dollar
recession.
. To be sure, if the Fed Ex. is not doing everything it can to reduce the share or level of U.S. government debt, it may not be able to adjust, make or maintain its financial conditions as required in times of economic crisis. Even if the Fed Ex. was able to increase its reserves, it may not be able to maintain the same level of government debt in times of economic crisis. A high government debt or even a high government payroll debt are also not acceptable to the Fed. Even if the Fed Ex. were to decrease its U.S. Treasury debt to meet these obligations, it will need to keep growing the cash available to the government for that debt reduction process, which it may not anticipate, and to avoid default.
D. Foreign Exchange Risk The Fed Ex. has little or no access to foreign exchange risk. Therefore, U.S. government exports must be properly financed or handled by an appropriate international law institution. If necessary, the Fed Ex. must comply with trade and investment standards that require foreign governments to abide by U.S. export and import restrictions and other agreements.
E. Global Warming An international organization that has been involved in developing policies and regulations on climate change has a unique experience in global warming. Therefore, it is very important that US government scientists, especially those on the Fed Ex. and the GAG Board, closely follow these international reports and follow up with their international counterparts.
F. Policy Implications of “Hazardous Waste Management” A recent report showed that in 2010, the Department of Energy considered $1.5 trillion to be hazardous waste, not only because it is in a state of rapid depletion. The report concluded that a “substantial burden” was placed on governments to clean up their wastes and create more effective ways to store and recycle them. The report also concluded that some 3.6 billion tons of hazardous waste were found to be undreamed-of hazardous waste.