Quincey Apparel Case Action Plan
Aaron Beker
100592498
Due: November 25, 2019 (11:59pm)
As a manager of Quincey Apparel, it is in our best interest financially and ethically to
shut down, thus the company will be closing in exactly 60 days. In order to meet deadlines
within the 60-day timeframe, we must consider potential stakeholders in the business and
determine how to approach the closure in a way that properly informs and compensates these
parties. The company has decided to not remain open as the changes that would need to be
made to continue running Quincey Apparel are strictly against our ethical beliefs and mission
statement. Other reasons for definitively shutting down are a severe lack of money, the public
image if we stayed open, bad profit margins and poor sales.
Keeping Quincey Apparel open conflicts with our mission statement because the
compensations we would need to make to keep the business alive would involve reducing sizing
which is one of the greatest selling points of Quincey. The stakeholders affected by the failure
to comply with our mission statement are mainly the consumer. This brand was built upon the
idea that women of many different shapes and sizes can acquire a quality professional
wardrobe. However, if we stay open, the biggest sacrifice we would need to do is to cut costs
by lowering storage space. This reduction in storage space means we would only be able to
provide consumers with a small handful of default sizes. If this change were to go through, our
mission statement would be shattered, thus invoking an ethical dilemma. A dilemma arises
when we change our sizing options because we betray the publics trust when it comes to
buying from Quincey Apparel since we marketed custom sizing and can’t provide true custom
sizing.
Our public image would be tarnished if Quincey stays open since the custom sizing
reduction would have a great negative affect on the trust our brand has built with consumers.
This business was developed with the mindset that women of all shapes and sizes would be
able to find a professional outfit. The consumer trusts Quincey with the ability to provide them
with these very specific orders and if we can not provide for them, we will lose all trust from
our consumer-base. This lack of trust will prevent us from expanding in the future since we
wouldn’t be able to market any new features or potentially new products since consumers have
already been proved to that we will not be able to hold up to our end of the exchange. This
breach of trust would cause us to lose customers assuming Quincey Apparel remains alive and
overtime we will reach the exact same issues we are currently having because our income has
been slashed by lack of customers willing to buy from us.
Bad margins are also another huge reason a disband of the business is required. The
business has objectively bad profit margins based on our projected amounts. In our financial
records we projected a profit of 47% at period end. In actuality, the profit margin was only 50%
of our projection. Although there isn’t a large timeframe to base our financial predictions on, a
failure to meet projected amount by half is a very bad start.
With these reasons to close Quincey Apparel it is important to determine some
deadlines to close the business. We must first inform the investors at the upcoming board
meeting of the closure. The reason we must complete this action is because investors are one
of our top stakeholders and need to be informed immediately of the decision. Next, within the
week a written notice must be provided to all employees that the company will be closing and
explain to them their compensation package, which includes 3 weeks pay as severance. 3 weeks
pay has been chosen because American standards are 2 weeks pay as severance per year
worked at the company. Since Quincey has been open for 1.5 years total, it is ethical and fair to
provide 3 weeks pay. The next stakeholder which must be informed are suppliers which will
done shortly after the notice to the employees. It is important to inform the suppliers since
they will need to find new clients and the ethical decision is to inform them as soon as possible.
However, final orders must be taken care of because the close. Consumers will be the final
party to gain knowledge of the close since they have the smallest financial connection to the
company. Consumers will be informed in 2 weeks, so they have ample time to complete any
outstanding orders.
With all the stakeholders considered, it becomes clear the steps we must take to ensure
all parties are handled with ethically. A case action plan can now be prepared and distributed to
the rest of management. Knowing why and how the plan will be carried out will greatly help all
stakeholders and make closing the business far easier since all steps have been planned.
Case Action Plan Timeline
To close Quincey Apparel efficiently and ensure professional measures are taken to
provide compensation or information to stakeholders a timeline can be constructed.
The day we make the decision at the “coffee break” we will inform investors at the
board meeting the decision we have made. Investors are the most important stakeholder to
inform as early as possible because they have first right to the liquidation of the business soon.
After the board meeting a notice for the employees will be prepared and shipped out to
all workers in 3 days. This amount of time will be enough to inform all employees about the
closure. This notice document will be provided via hard copy from the human resources
department and by e-mail to everyone.
We will give employees 7 days to ensure information is circulated around and the
employees that potentially have not seen notice early will likely be informed by other coworkers.
7 days after the decision to close, we will spend 7 more days talking and sorting out the
closing process with suppliers and sort out all financial requirements that must be met in order
to cut ties with the suppliers.
After 14 days a public notice of Quincey Apparel’s closure will be released to the public
explaining that final orders must be placed within the next 2 weeks. This fairly informs
consumers and provides satisfaction until the official shut down.
The rest of the first 30-day period will be spent settling any financial compensations that
must be payed out. This includes the severance payment for consumers and the beginning of
the liquidation process.
Investors debt will be paid off using the cash gain from the liquidation and this will take
place over days 14-60 after the decision to close.
After 30-45 days final shipping will be concluding, and buildings can begin to shut down
properly.
The 45-60th days will be spent tying up any financial loose ends associated with the
business. This will likely include liquidation of the property, plant and equipment as well as
determining the potential payout to management.
After 60 days, Quincey Apparel officially closes and all operations stop.
120 days after the close management can re-convene if possible and discuss a possible
plan to start up a similar business with hopefully more thought put into financial issues that
might arise.