Product details

Henleys, one of the largest electronics companies in the world, started to import domestic appliances and personal care (DAP) products into the Chinese market in 1990. Soon after, Henleys established a DAP manufacturing facility in China and selected a state-run distributor, Dongxi Company, out of a pool of three candidates, as the sole distributor in Shanghai. Over several years, Dongxi developed an extensive retailer network for the new DAP market in Shanghai, and the average annual growth rate was 200% between 1990 and 1997. The co-operation between Henleys and Dongxi was productive until 1999, when Dongxi''s efficiency slid into decline and many salespeople departed from the company, including the deputy general manager, who had been in charge of DAP distribution. Henleys faced a series of decisions regarding the possible restructuring of the distribution channels in a business environment quite different to that of 1990, when Henleys had made its distributor selection decisions.