The following appeared in a memo from the vice president of marketing at Dura-Socks, Inc.” A recent study of Dura-Socks customers suggests that our company is wasting the money it spends on its patented Endure manufacturing process, which ensures that our socks are strong enough to last for two years. We have always advertised our use of the Endure process, but the new study shows that despite the socks’ durability, our customers, on average, actually purchase new Dura-Socks every three months. Furthermore, customers surveyed in our largest market — northeastern United States cities — say that they most value Dura-Socks’ stylish appearance and availability in many colors. These findings suggest that we can increase our profits by discontinuing use of the Endure manufacturing process.”

The following appeared in a memo from the vice president of marketing at Dura-Socks, Inc.

“A recent study of Dura-Socks customers suggests that our company is wasting the money it spends on its patented Endure manufacturing process, which ensures that our socks are strong enough to last for two years. We have always advertised our use of the Endure process, but the new study shows that despite the socks’ durability, our customers, on average, actually purchase new Dura-Socks every three months. Furthermore, customers surveyed in our largest market — northeastern United States cities — say that they most value Dura-Socks’ stylish appearance and availability in many colors. These findings suggest that we can increase our profits by discontinuing use of the Endure manufacturing process.”

Write a response in which you discuss what questions would need to be answered in order to decide whether the recommendation and the argument on which it is based are reasonable. Be sure to explain how the answers to these questions would help to evaluate the recommendation.

Dura-Socks, Inc., a manufacturer of socks, insists that its patented Endure manufacturing process has led to customer dissatisfaction. In light of the company’s research, the vice president of marketing proposes that the company discontinue use of the process in order to save money. The strategy seems sound, but there are several questions that must be answered in order to determine its efficacy.

First, Dura-Socks must determine whether customers actually purchase new socks or whether they merely replace worn socks. If the replacement rate is high, the company will not have to suffer the consequences of discontinuing use of the Endure process. However, if customers replace worn socks more often than they purchase new ones, the company will suffer lost revenue. Furthermore, if customers frequently purchase socks of more fashionable colors, the company may be wasting money on the Endure process. If, however, customers prefer to purchase new socks, the company’s research indicates that it should continue to pursue the Endure process.

Second, Dura-Socks must determine the market in which it operates. If its customers are mostly urbanites who live in densely populated cities, they may be less likely to purchase new socks than if they were situated in more rural areas. Furthermore, if the company’s customers are mostly middle-income earners in large cities, they may be more likely to purchase fashionable socks than if they were low-income workers in rural areas. Thus, if Dura-Socks’ customer base is primarily urban, the company may be better off discontinuing use of the Endure process.

Finally, Dura-Socks must examine whether its customers still prefer the Endure manufacturing process. If customers still prefer to purchase new socks, the decision to discontinue the process will be an easy one.

All of these questions must be answered before Dura-Socks can decide whether to discontinue use of the Endure process. As the company’s research is incomplete, it may decide not to discontinue use of the process. However, if Dura-Socks determines that its customers prefer to purchase new socks, discontinuing the process should be an easy decision.