Executive Summary Kingsford Charcoal, one of the largest consumer products for The Clorox Company is the leading market shareholder for the charcoal segment. Recent trends have shown a decrease in all charcoal sales across the industry. Customers’ needs have changed in the grilling industry, causing the gas grilling business to increase. Competitors’ charcoal prices have significantly increased over the years while Kingsford Charcoal has only enforced slight increases. Kingsford Charcoal wants to identify why coal sales are decreasing and how they can turn this around and ensure this does not continue.
Overall, a rise in revenue and reduction in cost adds to CB’s profitability in Years 6 and 7. In reviewing Competition Bikes total selling expense, it was able to ascertain a huge 33% increase from Years 6 and 7 then managed to decrease that spending in Years 7 and 8 for about 14.9% (approximately $59,000) which is a strength for CB because they were managing their spending. For the Total General and Admin Expenses, Years 6 and 7 had a 20.4 % increase while the following years, 7
While this is a bit aggressive, we feel that as expansion wanes same store sales will increase marginally from the projected 3.5% growth primarily due to the strength of the brand. As the new store openings will begin to wind down, 2006’s projected ROIC of 25% is expected to decline steadily until reaching approximately 16% by 2011. We also assumed that the WACC would be stable at 10% since we did not foresee any material changes in the capital structure. We also believe the explicit period should be longer than 5 years, but due to the lack of concrete information, we decided not to forecast past 5 years. This assumption has most likely reduced our estimated valuation by neglecting some years with potential growth rates of more than 5%.
For the first time, shippers using Express Mail, Priority Mail, and several other parcel services will be able to get lower rates for large- and medium-volume contracts, according to the agency. Will UPS and FedEx need to cut their prices further to compete with the USPS? Large Rate Increases For 2008 This year, FedEx and UPS announced that rates for ground packages would increase an average of 4.9% on the ground and 6.9% in the air (minus a 2% cut in fuel surcharges, creating a 4.9% increase in the air as well). So what does this mean for you? The key term we need to acknowledge is averages.
Mr. Brownlow will need to sell $391,304.35 or 69,669 gallons in order for him to break-even (see appendix D). Average sales for our competitor’s wholesalers in the area was $5,529,775 in 2000 (see appendix C). This would suggest that Mr. Brownlow will be able surpass the required break-even amount easily. Manson and Associates’ Study D shows evidence that Mr. Brownlow will be able to meet his break-even in upcoming years as the number of licenses are predicted to increase in the upcoming years. For the recommended price point that it is suggested as $3.29 wholesale for a 6-pack or $5.82 wholesale for a gallon (Study I).
Kingsford is the charcoal industry – it cannot afford to not advertise, both during prime grilling season and in the currently non-cultivated “off-season.” There is a direct correlation between advertising dollars and sales volume, as demonstrated by the 7% incremental volume increase due to advertising in targeted markets in 1998. That strategic advertising also resulted in residual accrued benefits in 1999 with an estimated 3-4% volume increase. Specifically, Kingsford must increase advertising to targeted markets during non-traditional grilling times such as fall tailgating season and NASCAR in the spring. Such targeted markets include key NFL cities and college football towns. As discussed further below, Kingsford should also introduce a new line of organic “gourmet” charcoal.
Case 8 Report The Body Shop International PLC 2001: An Introduction to Financial Modeling Introduction In the early mid 90’s, the growth of Body Shop´s revenue was at least 20% each year. But by the late 1990’s, the revenue growth fell to 8%. Body Shop was able to grow at a fast pace early in the decade because of the lack of competition. However by the end of the decade, the competition grew fierce. Another reason for the slow growth in the late 90’s was the over expansion in the previous years.
That balance slowly adjusted over the next 20 years due to reduced production. The price of gas peaked at the end of that cycle in 2008 at $12.69 /mmBtu (millions of British Thermal Units) based on the Henry Hub Natural Gas Front Month Futures (a standard for finding the pricing point of natural gas). However, because of the economic crisis and the emerging shale gas market, the price lowered to $6.50 between 2008 and 2010. The quickly expanding market increased supply so much that it hit a low price of $1.82/mmBtu in 2010. It has averaged $3.50/mmBtu in recent years due to new fracking technologies and government subsidies (McElroy, Lu, 2013).
When the tax prices were raised for cigarettes, the equilibrium price rose as well. However, when that occurs the quantity decrease. For the quantity to remain the same, the price need only rise slightly, however if it doubles over night, the quantity will decrease. Many may wonder where this tax money goes. The money from taxes on cigarettes goes to the state, and with this years tax increase the state will bring in $265 million tax dollars.
Minimum wage is unacceptable because the cost of living will continue to increase. Raising minimum wage to at least 12 dollars an hour would help meet the standards of the economy. The federal minimum wage for covered non-exempt employees is 7.25 an hour effective July 24, 2009. In