Many of these facilities are also in need of major capital equipment upgrades. Tootsie Roll Industries’ expansion into the global market with selling their products in over 70 countries has also helped it to be a major player in the candy business. The continued advancement of the company’s products into global markets is imperative for the continued success of the company. Capital Equipment Capital Equipment within Tootsie Roll’s plants is functional but somewhat antiquated and needs a lot of maintenance to maintain. 20% of the loan amount will be used to acquire capital equipment in 2 of Tootsie Roll’s plants.
Why or why not? During the J.M. Smucker Company’s transition in 2000-2001, Richard Smucker stated “Our strategy is to own and market Number 1 brands, sold in the center of the store, in North America. The real money in supermarkets is made in the middle of the store, where processed foods and well-known brands reign supreme.” Smuckers shares this strategy across all its brands, and because of this their sales have increased a great deal from 2000 to 2010. Not only did it make sense to expand their business beyond jams, jellies, and preserves, but it may have saved them.
To keep up with growing demand they also have an online shop supporting an international customer base. High-class outlets are seen as competitors as opposed to international corporations with wide and well known product portfolios. Hotel Chocolat is always looking for new ways to increase its product collection, but also aims to change just over a quarter of its range each year. This is done predominately through a chocolate tasting club where for a fee, members can sample and offer feedback on new creations. Two reasons for this constant product rejuvenation are to maintain current consumer interest and hopefully draw in new customers, but also to detract other companies from mimicking its ideas.
FANTASTIC MANUFACTURING FACTS To continue the good business relationships with Fantastic’s’ SUPPLIERS (in Hong Kong and Taiwan) and CREDITORS (the bank via 60 day bank draft) we must develop longer range forecasts so that our suppliers can arrange way to produce more and so that our creditors are aware of our increasing need for capital as our sales volume increases. The Business • Manufacture and market ceiling fans • Rose and Turner went abroad to find exclusive suppliers in Hong Kong and Taiwan • Initial objective was to get product on the shelves and have the small retailers advertise heavily • Consumers began to realize that ceiling fans were energy-savings devices which created greater growth potential for the industry • 2 major competitors- Hinter and Casablanca both produced domestically by Emerson Electric • 2 customers accounted for 40% of sales although Fantastic served more than 100 customers annually The Product • Fantastic held a COST advantage over competition because of outsourcing • All Fantastic fans had a 7-year warranty Accounting Factors • Commission to salesmen were paid in the same month sales were made • Customers paid 60-90 days (2-3months) after Fantastic shipped finished products PAYMENT TO SUPPLIERS • Fantastic issued letters of credit to the suppliers once the order was submitted, in turn the suppliers submitted these letters of credit for payment when they had manufactured the goods and the goods were shipped (30 after the order was placed) • Fantastic did not keep cash on hand to pay for supplies • Once the letter of credit was submitted to the bank, Fantastic typically drew a 60-day draft on the amount of the needed funds to pay for supplies • The bank would accept the draft and extend the loan for a
B&J has a unique branding system for new flavors that uses catchy titles and sometimes humor to attract new customers. As mentioned in its mission statement, B&J used local merchants to help develop its final products and spent valuable time and money searching for the highest quality inputs for its ice cream. * More could be said about the “all-natural” ingredients and how they are sourced. 2. Economic performance The economic dimension of B&J’s mission statement seeks “[t]o operate the company on a sound financial basis of profitable growth, increasing value for our shareholders, and creating career opportunities and financial rewards for our employees” (Bruner, 2009).
That is why in my assessment I will try to look closely to the company, see how it operates as well as will try to implement company strategic plan while comparing it to other similar brands in the market. Executive Summary Starbucks Corporation has arguably been the most successful coffee chain in the past few decades, using their aggressive expansion strategies to push out much of its competition. Through its expansion, Starbucks has focused on creating a dense network of stores all around America, while also opening up new locations all around the world. By leading the retail coffee market, Starbucks is able to sell its coffee for a premium price and increase their profitability. Its success can be seen in the gradual rise of its stock prices from 1992 till 2011.
Subject: Super Project Cash Flow Analysis Date: April 9, 2012 KEY ISSUES General Foods captured a sizeable share of the powdered desserts market with the introduction of Jell-O. As a leader, it is necessary for General Foods to maintain and increase profits for the future. Potential introduction of a new product, Super, offers General Foods the ability to achieve such objectives. An accurate evaluation of the profitability of Super will indicate whether General Foods should go ahead with the project. ANALYSIS Previous analyses evaluating the project on incremental, facilities-used, and fully allocated basis provide an inaccurate picture of the project.
1. What factors should the management consider in evaluating the proposed advertising program and technology upgrades? Ameritrade’s management has to first consider the required investment expenses and the expected increase in future cash flows from the proposed advertising and technology upgrades. For calculating the future cash flows, the company should also take in to account fluctuation in market demand and its effect on the project viability. The next major item will be to calculate the cost of capital and compare that to their expected IRR, which should be larger than the cost of capital.
Therefore, the main factors that Ameritrade management should consider are the expected return on investment for the project, and how this compares to the project’s cost of capital. Other factors that should also be considered include: how market swings will affect the expected return on investment, the project’s payback period (the project will require massive initial outlays, so Ameritrade could find itself in financial trouble if results are not seen relatively quickly), the unique risk that would come along with being the only major player in their price range, the risks inherent in being the “first adopter” of new technology (unforeseen technical problems, the possibility that price cuts in the near-future could allow competitors to obtain the same technology at a drastically reduced price, etc. ), the relative success of previous advertising campaigns, and the positive effects that an increase in market share could have on future projects. Ameritrade management should consider RE&DE and Efficient ROI Management. Because in order increase market share and company's revenue Company has to adapt the compatition and create the compatitive advantage by altering RE&DE And Efficient ROI Management * Future cashflows * Future revenue * Debt to equity ratio * Cost of equity/ return on equity 2.
NOVA School of Business and Economics Managerial Accounting | Ericson Ice Cream Company | Managerial Accounting | Ericson Ice Cream Company | Introduction The present paper serves to exhibit the group’s analysis on the case “Ericson Ice Cream Company”. This case presents a situation where a company faces a problem that could be solved through a more accurate management accounting. Case Analysis Ericson Ice Cream Company was a successful ice cream producer which had seen its profit increasingly growing in the past years. As a consequence if its success, it decided to increase its products’ portfolio and started producing two additional flavours which could be charged at a higher price and, therefore, originated higher profits. However, after the introduction of these two new flavours, the company’s operating margins decreased.