The Growth Oppormnity Giulia's original trial order was for 1,000 units, but soon she had a reorder rate of 1,000 per month. The retailer paid Giulia $11.00 per unit for the pitons and absorbed the shipping costs. The forge charged her $9,000 to make and pack an order of 1,000 pitons. After accounting for material waste and recovely, the cost of the titanium alloy bars was $1.45 per piton. Clearly, she was not making much money on the business. In fact, a minimum wage job would have provided more income. However, what mattered to Giulia was the proof of conceptshe could successfully design and sell her ovv-n products. The start-up risk and capital requirements had been low and now she had her crom business. Giulia had been thinking about ways of increasing profits, including an idea for a new product line, when a quick series of sill-prise events changed the landscape. First, she received a call from her single customer. He told her that he had been impressed with the quality and design of her product and proposed the follovng offer: "If you give me an exclusive supplier arrangement for t-vvo years, I will guarantee you a purchase volume of at least 4, 000 units per month at $10.50 per unit for the length of the nvo-year contract. I have to tell you, however, I think demand could be about 10% higher, but I will not commit to that for the length of the contract. " Her elation at that offer quickly evaporated because the $10.50 price would barely cover her current unit costs. She also knew that even four times the current pumhase quantity would not qualifr her to move to the next level of volume discounts on material. She wasn't even sure that her contract manufacturer had the available capacity to quadruple production for her, nor whether he would give her a price break for that extra volume.