The original strategy is the launch of a brand line for Rose Partyware that will showcase a new printing technology that will improve quality and reduce costs. In choosing to go with this idea Rose could potentially be the first branded partyware line and it will push Rose ahead of its competitors. There are a few drawbacks though, one of them being that branding is going to be more expensive than originally projected which would mean they would have to increase the price by 6-7%. Also, there are costs associated with marketing the new brand as well. On the flipside, Party!
In recent years, the company increased its number of outstanding share to finance its acquisitions, which raised the payout ratio to more than 50% in 2006. Blaine Kitchenware fears that such a dividend policy isn’t sustainable in the future. Indeed, if the company keeps a high dividend payout without the cash flow to back it up, it will have to reduce its investment plans or turn to investors for additional debt or equity financing. As pointed by a banker, because the company is over-liquid and under-levered, using Blaine kitchenware’s excess cash and new borrowing, a private equity firm could buy all the outstanding share of the company. In light of that discovery and fearing this hostile takeover, Victor Dubinski is thinking of revising the company’s financial policy (i.e.
Case Problem/Opportunity The Amber Inn & Suites, Inc. has been generating negative profits. The company must find a business method and strategy that will increase EBIDTA to grow 7% in 2 years. In trying to develop the most beneficial business strategy, Amber Inn has to allocate their marketing and advertising budget more efficiently. Their marketing costs rose from $1.14 million to $12.5 million. Now they must align their marketing strategy to cohesively coincide that of their business plan to bring in the clientele that will make them the most profitable.
Pepcid as a prescription drug has already gained its market as a brand name drug. This creates a demand for the general public for OTC version of Pepcid. Additionally, usually FDA takes several years to process the approval of a prescription-to-OTC switch. Before the patent expires, JJM can take the advantage of patent protection and enter the OTC without competition and thus occupy a larger consumer market earlier. Factors include indication, drug safety, and brand awareness.
Options • Expand “Alumni in Marketing” Network • Build Corporate Professional Development Program (PDP) • Expand Direct Sales Recruitment • Build Telemarketing Capabilities • Increase Prices • Adjust Course Mix Recommendations We believe that building the corporate professional development program (PDP) at Hurricane Island Outward Bound School is the best option. It will increase Outward Bound’s profits in efficiently through increasing their profit with an overhead of 135 dollars per SPD. Chin believes that the school can charge corporate clients more than they charge their public clients. This is 170 dollars more profitable than their public courses. Outward Bound gives scholarships out to the less fortunate public students that are financially unable to afford their adventurous programs.
The managers want to expand the national market shares through this way to increase profits. Even when Best Buy began to use a new sales model in 1990, Circuit City still carried on the aggressive expansion program to open the market. Although resulted in too many stores in different places and the national market share has increased, however, its share in served markets had dropped in 1990. From this situation, it shows the expansion strategy did not work any more, because the market environment changed and competitors became stronger. Under the high competitive and fast-evolving electronic industry, no change means fall behind.
First problem we encountered were the current and quick ratios were unusually high due to the amount of cash, receivables and short term investments that Krispy Kreme held. This is an indication that the company was not investing in other projects and remained conservative with regards to the treatment of current assets from 2001 to 2004. The net sales, receivables and inventory turnover were much lower compared to the industry, but ultimately the profit margin and return on equity remained consistent which we considered questionable. The leverage ratios were lower than the industry; the company used debt to make payments and took a line of credit. Although cash reserves were high and debt was very low, the cash ratio was lower
But in the meanwhile smaller competitors started to quickly erode market share with prices cut. In 1997, instead of cutting prices, UST reacted to the growth of this value players with the introduction of premiumRed Seal but it was late considering that other brands were already successful in this segment. Moreover, UST is over dependent on smokeless tobacco business that contributed in 1998 for about 97% of
In addition, when CEMEX began expanding abroad, they used PMI teams to streamline a new firm, identify and retain talent, and adopt the key standards of CEMEX's business model. This ensures that their subsidiaries are working in the same fashion as the home plant. CEMEX ws also able to reduce their costs by incorporating new technology, which allowed them to maximize knowledge to everyone in the company, and allow operations to flow more smoothly. In addition, concentrating their focus on other countries can help ensure stable revenues, such that if their home country is experiencing a downturn in GDP, they can stabilize their sales in other countries experiencing GDP growth. Further, there has been a reduction on tariffs due to exporting their product.
Dollar General in owned by Koldberg Kravis Roberts & Co. L.P (KKR) who own more than 79% of all shares in Dollar General. Some argue that part of the reason Dollar General has been so successful as of late is attributed to the economic crisis the United States experience during the second half of the 2000s. Economist believe that consumers will not shop at the Dollar General as much as the economy improves. In an effort to retain their existing customers and recruit new ones as the economy strengthens, Dollar General has begun to stock name brand items. Some analysts also believe that even when the economy improves, your average consumer will still look for ways to save money and continue to frequent the dollar discount stores.