This project will need $3.4 million less than the P04 project and the only component in the investment, which will be more, compared to P04 is the building cost (378 K$). Cannibalization of other store’s sales As the nearest target store closest to the project is 80 miles away, no cannibalization of sales is expected. And this store will generate a sale of $30.5 million in 5 years, which will be almost 2.7 million dollars above expected sales from P04. This store is assumed to take it’s a maximum market share from Walmart in 2008. Store Sensitivities Even if this store has 18.1% lower sales than the forecasted level by R&P, it can achieve the accepted NPV of prototype, besides, construction cost can increase to near $10 million and still the project can achieve the expected NPV of the P04.
Money market deposit accounts which need to pay only a little interest to our depositors are 20.40% higher than peers, but Time deposits which need pay a lot interest are 14.84% lower than our peers. Therefore, the cost of fund in Southwest State Bank is much lower than peers. The second factor is
Livoria Sandwich Inc. is operating in a highly competitive and fast growing market. In 2011, the company had only 0.29% profit margin. In order to seek competitive advantage and gain market share, Livoria needs to cover its current cash shortage before going any further. In this memo, three strategic alternatives are evaluated; and recommendations and implementation plans will be given to cover Livoria’s short-term cash shortage, gain market share, and earn $1.1 million net income by 2014. Situational Analysis As shown in Appendix 1; in 2011, Livoria generated 53% contribution margin which is almost 10% higher than the industry average.
Express has a slight decline of 2% since the year 2012. Macys however has kept a steady 40% since 2012. This informs us that Express has had a decreasing retain of each dollar of sales while Macys has not increased but maintained their direct cost of goods and services sold. This same trend has taken place with the profit margin of both companies since the year of 2012. Express has a slower decline of 1% but a decline nonetheless beginning at 7% in 2012 ending at 5% in 2014.
Also, Frito-Lays has eight of the top ten selling snack chips. However, the industry is extremely competitive with over 650 new snack chip products introduced each year. Less than one percent of new products generate more than $25 million in sales in the first year. 2. What specific challenges and risks does Frito-Lay face in marketing Sun Chips and what are their implications?
For example, the company is showing $5,083,000 in net sales, with a gross profit of $1,371,400. This is a substantial amount and it proves that the company is doing well in the sales department. Another strength of the company is that the total selling expense is relatively low compared to the gross profit. Competition Bikes total selling expense is $338,748, which is only 24.7% of the gross profit. Having a low total selling expense means the company can allocate funds to other necessary
The company has exceeded its goal of more than 50 new product launches during 2009. The company had segment operating income of $275 million in the third quarter of 2009, up from $266 million in the 2008 third quarter and $24 million in 2009’s second quarter. Compared to the prior year, third quarter 2009 segment operating income reflects continued weak industry demand, which resulted in a negative volume impact of $64 million and under-absorbed fixed costs of approximately $107 million. The 2009 quarter benefited from $207 million in lower raw material
(TCO G) The ABC Corporation's budgeted monthly sales are $4,000. In the first month, 40% of its customers pay and take the 3% discount. The remaining 60% pay in the month following the sale and don't receive a discount. ABC's bad debts are very small and are excluded from this analysis. Purchases for next month's sales are constant each month at $2,000.
A 25% increase is calculated for the next four years. These figures are from a feasibility studies conducted by Digital Fusion. Digital Fusion as allocated a Total Budget to this project of $500,000. Digital Fusion has found that by not having an online presence they are not tapping into a large consumer base (Richelson, 2013). Not only are a fair amount of their competitors online but they are getting more business from advertisements online.
When analyzing the four financial statements, it is easy to see that Starbucks triumphs over Caribou in almost any statistic or ratio. Starbucks has a much higher net income and a profit margin, while Caribou owes a lot more money. Caribou is the smaller company and therefore, has a smaller net income, but Starbucks has a better costs of goods sold to net income ratio, which means that they make more money while spending less. In Caribou’s management’s analysis, it is stated that Caribou is the second largest coffeehouse operator in the United States and it is fair to assume that it is trailing behind Starbucks. Starbucks also finished the previous financial year with no short-term debt and repaid a lot of its long-term debt.