What to do with Ed Gowan? Ed Gowan works for the Kent Company. He had been hired two years ago on the strong recommendation of one of the companys best customers. Ed had been selling a line of goods competitive to the Kent line for four years with apparently good results. After initial training in the Kent line, Ed had been given a good territory. However, he failed to produce up to company standards. The Kent Company sold a line of high-quality sportswear to traditional menswear shops. A style shift had given the company a big boost in sales. The companys sales management policies differed significantly from other firms in the industry. Most of the industry paid straight commission6 to 10 percent of salesand the reps paid all their own expenses. Kent paid a salary plus bonus and all legitimate expenses. Management believed that motivational tools beyond money would prove just as useful. Each rep was expected to sell $1.25 million in wholesale orders. Expenses were expected to be less than $25,000 per year on average. Reps were expected to work 200 days and make 400 calls. Company accounts were divided into two groupsA and B stores. A stores ($1M or more in sales) were called on at least once a month. B stores (less than $1M in sales) were called on at least 4 times a year. The average rep had 15 A stores and 58 B stores. Territories varied and customers would call in orders if they ran short of inventory. Eds sales manager found that his sales for last year were $910,000, a most unsatisfactory amount. His expenses of $16,500 were most modest. His sales reports showed he made 435 calls among 11 A stores and 66 B stores. Eds sales to A stores were $190,000 and to B stores, $720,000. Clearly his performance was unsatisfactory. If he did not improve significantly and quickly, he would be fired. Questions: 1) What does an analysis of Eds sales indicate? You must break it down into sales per store type, not an overall view. How much variance is there between Eds sales and the expected sales from a normal territory? Be specific and identify your numbers. 2) Is Eds territory a problem or is it Ed? Explain. 3) What time frame will you give Ed to improve or be fired? What intermediate sales goals will he have to hit in his probationary period?