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1、Weygandt_2ndEd._CH091/22/091:10PMPage358CHAPTER9PricingPRICEANDQUALITYARECRITICALASMUCHASWEALLLOVETHESUNSHINE,itsultraviolet(UV)radiationhaspo-tentiallyharmfuleffects.Exposuretoinvisibleultravioletlightcancauseseri-ousdamagetoyoureyes.ConsideringthatUVraysposeathr
2、eattothelens,retina,andcornea,year-roundeyeprotectionisnecessary.Vancouver-basedSuntechOpticsisanimporterandcross-Canadamarketerofsunglassesandothereyewear.AsMelanieMartin,CEOofSuntech,pointsout,“Thedarknessortintofthelensinapairofsunglasseshasnobearingonitseffect
3、ivenessinblockingUVrays.Specialtychemicals,addedwhenthelensesarebeingmade,ensurefullprotectionagainstUVradiation.”Withover30yearsinthebusiness,SuntechhasestablishedrelationshipswithmanylargeCanadianretailersincludingtheHudson’sBayCompany,CanadianTire,Pharmasave,th
4、eForzaniGroup,andtheJeanCoutuGroup.BeingasuppliertotheCanadianretailindustryisaverytoughbusinessandSuntechfacescom-petitionfromavarietyofsources,includingU.S.companies.SomeretailersalsochoosetodealdirectlywithsuppliersinEastAsia.“Priceandqualityarebothcriticalfact
5、orsinourbusiness,”advisesMartin.Suntechhasdevisedextensivequality-assuranceprocessesthatitimplementsinconjunctionwithitssuppliersinChina,HongKong,andTaiwan.ProductarrivingfromEastAsiaiscarefullyinspectedtoensurethequalityoffinishinlensesandframes,aswellasaccuracyi
6、ntheprintingoflabelsandpackages.Inchoosinganewsupplier,Martinlooksforinvestmentinnewtechnologies.Communicationsarealsokeytomaintaininganeffectivesupplychainandpre-ventingdelayswithproductdelivery.Suntechmerchandisersareresponsibleformaintaininginventoryanddis-play
7、sattheirretailaccounts.Inventoriesaremaintainedonaconsignmentbasis;Suntechrecordssalesbasedoninventorymovementsatthestorelevel.“Pricingwithretailchainsisnegotiatedatthenationallevel,”saysMartin.Pricesinthisindustryarenotstraightforwardsincethosewithlargeretailersa
8、resubjecttoavarietyofallowancesthatreduceSuntech’sprofit.Theseallowancesvaryinscaleandtypeaccordingtocustomercategory;theyincludebusinessde-velopment,pr