Nola Cycles Case Questions

2. Current sales are given as 200,000 units annually; this is also estimated to be the amount that Nola would sell per year over the next three years if it does not partner with X-Mart. If the company does partner with X-Mart, it estimates that it will lose approximately 6,000 units in sales among its other lines, and possibly some unknown quantity from dealers who decide not to carry Nola's line due to the competition with X-Mart.

This last factor, which Nola should not overlook, can be addressed in another manner, however. Nola enjoys close relationships with specialty bike dealers. Although X-Mart has not sold bicycles before this, other discounters have. Nola can argue (and persuasively) that consumers who purchase bicycles from X-Mart or other discounters are not the same consumers who purchase bicycles from specialty bike shops. Instead of losing market share to these discounters, the discounters are bringing entirely new co