1. Case Study 11.2
Fender International- Creating
A Positive Retail Experience
(Alex and Terry Hill, 2011)

2. Group Members
Miranda Nasasara
Nathan Williams
Subhi Pradhan

3. Table of Contents
• Case Study Summary
• Company Background (Fender International)
• Case Study Questions
• Supply Chain Management
• Importance of Supply Chain
• Origins of Supply Chain
• Current Trends of Supply Chain
• Case Study Question 1
• Case Study Question 2
• Case Study Question 3
• Discussion
• Conclusion

4. Case Study Summary
• Fender International’s aim
a) A guitar must be playable straight from the
box
• Created a ‘positive retail experience’ in their
supply chain
• Created a partnership with UPS European
Distribution Centre
a) Inspection of guitars by players before being
sent to customers.
b) Inventory management
c) Returned faulty guitars

5. Company Background
• World’s leading manufacturer of electric guitars.
Year Background
In 1940 Founded by Clarence Leonidas
"Leo" Fender.
In1965 Company sold to CBS.
Until1980 The company experienced
tremendous growth.
In 1985-1990 a group of employees and
investors led by Schultz bought
Fender from CBS but there were
no buildings or machinery
included in the sale.

6. Background contd..
Year Establishment
In 1985 Saw the establishment of
Fender’s flagship U.S. factory
in Corona, California (move
toward greater quality control )
In 1987 a) A second modern
manufacturing facility opened
in Ensenada, Mexico.
b) - the renowned Fender
Custom Shop opened at the
Corona facility, creating dream
instruments for professional
guitarists and guitar
enthusiasts.

7. Fender’s Products and Brands
Products Brands
Electric Guitars Mustang
Bass Guitars Jazz Bass
Acoustic Guitars Banjo
Guitar Amplifiers Hot rod
Bass Amplifiers Bass man Pro
Fender Audio • Picks
Accessories • Stands
• Straps
• Strings
• Tuners

8. Case Study Questions
1. What is the significance for Fender International of
the guitar tuning service offered by UPS?
2. Why do you think distributors are now ordering
products that they never ordered before?
3. What action would you suggest to take in the
improbable case that a customer returns a faulty
guitar? Is it manufacturers’ fault? Is it transportation’
fault OR tuner professional / amateur musicians’
fault?

9. Supply Chain Management
Definition of Supply Chain:
• “The sequence of organizations- their
facilities, functions and activities-that are involved
in producing and delivering a product or service”
(Slack et. al., 2011)
• “functions within and outside a company that
enable the value chain to make products and
provide services to the customer “
(Cox et al.,1995)

10. What Is A Supply Chain?

11. Importance of Supply Chain
•To remain competitive
•Faster product availability
•Faster product delivery
•Discovery of value-enhancing and long term
benefits
Who benefits most? Firms with:
– Large inventories
– Large number of suppliers
– Complex products
– Customers with large purchasing budgets

12. Origins of Supply Chain Management
12 Johnson and Davis (1995)

13. Current Trends in Supply Chain
Management
• Expanding the Supply Chain
• Increasing Supply Chain Responsiveness
• The Greening of Supply Chains

14. Q1: Significance for Fender
International of the UPS service
• Streamline inventory management
• Quality inspection.
• Improve customer service.
• Tailor warehouse services.
• Centralized transportation.

15. Q2:Why are distributors ordering products
that they have never ordered before?
Fender international distributors
• Worldwide network of authorized dealers.
• Europe, Asia , middle
east, Africa, Oceania, North America, South
America.
Globalization /Civilization of music instruments
a) Company & product expansion
b) Vintage Collection
c) Attention to Customer Details
d) Good Investment

16. Q3: Actions suggested to take in the
improbable case that a customer
returns a faulty guitar?
• 21-Point Inspection
• Non-warranty repair work
• Complete Documentation
• Worldwide Repair/Service Options
• Complimentary Shipping

17. Contd…
• The fault possibly lands with transportation and
the amateur players.
• Manufacturers should be able to put together a
playable guitar when taken out of the box.
• Transportation may not have transported the
guitars in the best way.
• Guitars maybe being inspected by players that
are not doing their job properly.

18. Discussion
• Do you think bringing in amateur
musicians to fine tune Fender’s guitars is
a good idea?

19. Conclusion
• Existence of the importance of the services
offered by UPS services.
• Company & product expansion.
• Attention to Customer Details.
• Current service is quite good.
• Transportation & amateur players at fault.

21. ANY QUESTIONS?

22. References
• Cox, J.F., Blackstone, J.H. and Spencer, M.S. (Eds) (1995)
APICS Dictionary (8th ed.), American Production and
Inventory Control Society. Falls Church, VA.
• Johnson, M.E. and Davis, T. (1995) Gaining an edge with
supply chain management. APICS – The Performance
Advantage. 5 (12), 26-31.
• Hill, A. and Hill, T. (2011) Fender International :Creating A
Positive Retail Experience ,Palgrave.
• Fender (2011) About Fender. Available online at
http://www.fender.com/ . [Accessed 20/01/12].
• Slack, N., Chambers, S., Johnston, R. and Betts, A. (2009)
Operations and Process Management: principles and
practices for strategic impact . 2nd edition, FT Prentice Hall,
Harlow.
• UPS (2011) About UPS. Available online at www.ups.com.
[Accessed on 23/01/2012].