Ralph Lorean International (RLI) owner of several house dcor and furniture manufacturers recently purchased a controlling interest in a medium-size firm, House of Cloth (HOC), which employs 6,644 people worldwide. HOC has been considered a premier manufacturer of cloth since 1964. Revenues over the last four years have been flat and costs are rising steadily. RLI purchases an interest in the company despite the flat sales because of its reputation and loyal customer base. RLI has a history of turning troubled companies around and they think they can do the same with HOC.