Abstract

Lawrence Glaubinger, a Columbia Business School alumnus, became increasingly involved in running his 100-acre Christmas tree farm after he retired in 1992. Between 1993 and 2008, Glaubinger sold Ponderosa pines through an arrangement with Green Acres, a large retailer that bought Glaubinger's trees to sell at its nurseries. While Glaubinger Tree Farm sold the trees to Green Acre at a wholesale price based on its marginal cost, the retailer independently set retail pricing. Glaubinger suspected his tree farm could have shown higher profits if it had sold directly to consumers. In this case students examine 15 years of sales data and consider Glaubinger's marginal costs to determine how much additional profit he could capture by selling directly to consumers.

Citation

Toubia, Olivier. Glaubinger Tree Farm. Columbia Business School: CaseWorks, Spring 2010.

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