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Case Johnson Beverage Inc

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Case Johnson Beverage Inc
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Jason Rodgers, the operations manager for JBI, was listening carefully. This was the first he had heard of the situation, but to a careful observer, his nod would have revealed what he was thinking. He said:
You know, I’m not a bit surprised to hear all this. Saver Superstore is a great customer. They buy lots of beverages, and they’re easy to deal with. They place their orders on a regular basis and almost never ask for anything special. I don’t remember the last time we had to run around in the warehouse pulling together a rush order from them. Who wouldn’t want that business?
Stevens agreed, “You’re right. I almost never have to change my delivery schedule because they’ve asked for quick delivery. And they’re right around the corner, so they’re easy for us to get to”.
Rodgers continued:
I think about some of our other customers. They seem to never be able to anticipate that they’ll be out of stock. Then they call us and make it our problem to deal with. It seems like we have some customers that we work on all day every day. Why can’t that competitor go after those customers? It’s hard for me to believe that some of those customers are more profitable than Saver Superstore. Maybe we ought to add what we guys in the warehouse call a “pain factor” onto those other customers and then see who is most profitable for us.
As Johnson listened, he realized Rodgers might be onto something. “Jim, what types of costs are included in those customer service costs?”
Thomas replied, “Well, that number includes several things.” He continued:
It includes anything related to handling the beverages, like picking the beverages from the warehouse shelves according to the order instructions, moving the beverages over to the dock, and loading them on the delivery truck. It includes any costs related to taking, coordinating, and administering the orders, like what we pay the people in the sales office who take phone orders from customers, the supervisory costs to

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