Question

Mike of Mike’s Marketing Magic and Lisa of Lisa’s Computer Cave have been doing business with one another for over 10 years. Initially Lisa was quite happy with the relationship and found Mike’s service to be excellent. Over the past year and a half, however, the pamphlets and advertising materials from Mike’s Marketing Magic have been late with increasing, and alarming, frequency. Lisa has spoken to Mike about this, and while the problem was solved for a short time, it has recently begun to be a problem again. On the other hand, Mike’s prices are the lowest that Lisa has managed to find. From Mike’s perspective, the relationship also began as prosperous. Recently, however, Lisa has hired a new accounts payable clerk, who regularly misses the due dates for payment and sends the money late. Mike also has suppliers and finds this inconvenient and that his relationships with his suppliers are deteriorating. As was the case with Lisa, Mike has called and spoken to the clerk, which improved things briefly, but they shortly reverted to late payments. Last week Lisa ordered a shipment of brochures from Mike in preparation for a trade show sale that she had a table at this past Saturday. She had paid to be sponsor of the trade show to have a prominent table at the show. Without the brochures and advertising materials, Lisa was forced to give use her “old” advertisements to the people who came by her table. She believes that she lost significant business. When she called Mike, he told her that he was still waiting for payment from the last shipment, which was overdue, and was not at all sympathetic. In light of the foregoing, and assuming that direct discussions between the parties has not been successful, answer the following questions: a. List, and briefly explain, the dispute resolution mechanisms available to Mike and Lisa and provide two advantages and disadvantages for each (please explain your answers thoroughly and you may set it up in chart form). b. If you were advising Lisa as to how to proceed, and you know that she is concerned about her privacy and business reputation above all, which one of the available mechanisms would you suggest she select and why, and which ones would you reject and why?

NEED ANS ASAP.

Answer 1

(a)

Chart form:

(b)

Lisa should proceed with mediation. Because of following reasons-

1. Most importantly, the relationship between Lisa and Mike are important to Lisa. Because the prices offered by Mike are lowest.

2. The dispute explained in the problem, does not involve a technical or legal point, so to approach an arbitrator for legal procedures are not advisable.

3. Mediation it is a cost effective method and flexible and parties could make adjustments with their mutual consent.

4. It consumes less time, because a problem to be resolved expediently in order to maintain the consumer base. So a fast dispute resolution is required.

Lisa should not proceed with arbitration because-

1. It is comparatively more costly than meditation. Because it involves the requirement of a technical expert which two charges the higher fees.

2. The dispute explained in the problem does not involve a technical point.

3. Which is the more formal process as compared to mediation, so more time consuming.

Lisa should not proceed with litigation because-

1. It is a very costly and time consuming process.

2. The relationship between Lisa and Mike will be affected negatively.

3. The dispute does not involve any legal point.

4. The information regarding business dispute, will be known to public and it would result in bad effect on public image of the business entities.

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