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payment terms allowed Alondra and UCIC to buy and warehouse the
insulation, sell and install the product, and collect the sale
price before being required to pay Owens-Corning. Alondra and
UCIC always took advantage of the discounts offered by Owens-
Corning. The Alondra-UCIC combination was Owens-Corning's
largest customer, and Alondra and UCIC were given Owens-Corning's
best prices and terms.
As a result of the policies set by Mr. Munro, UCIC--and
later Alondra--came to have excellent reputations with suppliers
like Owens-Corning and with their customers, the general building
contractors. Alondra and UCIC could sell at competitive prices,
and general contractors could depend on the two companies to
deliver and install the product in good time, pass the necessary
inspections, and relieve the general contractors' concerns about
the insulation work on their projects. Alondra and UCIC did not
require any outside borrowings through 1987.
In the late 1970's, building activity was increasing in
California, but insulation contractors were restricted to limited
amounts of fiberglass insulation material from the primary
supplier of this material, Owens-Corning. In response, Mr. Munro
decided to supplement fiberglass insulation, which is in bat
form, with blowing wool made of cellulose. He acquired eight
blowing trucks for UCIC and Alondra, as he correctly anticipated
that the shortage of fiberglass insulation would last several
years. With the eight trucks, at first primarily UCIC, and later
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