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Author(s)

Sarit Markovich

Evan Meagher

Tel Aviv based Diskit Khartsan Ltd. sold sprays, traps, and netting to combat Blatta lateralis, the Israeli flying cockroach. The insect, slightly over one inch (2.54 cm) long and capable of flying short distances, was noisy, unsightly, and posed a risk of food contamination. Every heat wave brought more infestations, and consumers across the Mediterranean armed themselves with Diskit's HLH brand products.

HLH products generated nearly two-thirds of Diskit's annual revenues. During periods of low demand, local retailers resisted devoting significant shelf space to the bulky products, which meant that during periods of high demand stockouts occurred frequently and Diskit lost sales. To address this problem, the company had implemented a trust receipts program that raised prices for retailers by 3 percent but allowed them to take Diskit products onto their balance sheets without payment until the products were sold.

At the recent end of the fiscal year, Diskit CEO Reut Cohen needed to evaluate the trust receipts program and discuss ways to improve it for 2014.

Date Published: 08/22/2014
Discipline: Strategy
Key Concepts: Accounting, Cash Flow Analysis, Competitive Strategy, Decision Making, Distribution Channels, Financial Analysis, Financial Planning, Financial Strategy, Pricing Strategy, Strategic Planning
Citations: Markovich, Sarit, Evan Meagher. Diskit Khartsan Ltd. in 2013: Hatching a Solution. 5-214-253 (KEL807).