Cost Analysis On The Company

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Cost Analysis On our first meeting with our sponsor, we were asked to do a cost analysis to determine what is the lowest price that the company can charge for each style and when would they break even. Since the company had taken reserves on almost all the shoe styles for Dr. Comfort, we had to determine the net inventory after the reserves. To accomplish this task, we created an excel worksheet that lists all the items that have been assigned a percentage of reserves (Please refer to the worksheet in Appendix). After determining the amount of reserves for each shoe style, we calculated net inventory. We added additional costs such as the average freight for each country and calculated a new cost per style after including all other costs…show more content…
Each unit sold after the breakeven quantity would be a profit for the company since all costs would have been covered. To accomplish this task, we used an average cost approach since that is the method used to value Dr. Comfort products. Interviews Throughout the course of this project, we met many people who were either directly involved with Dr. Comfort shoes or had years of experience on international markets. Our task was to come up with questions to ask them at each meeting to help us reach our goal. John Martin, VP of International Markets at DJO Global LLC The first person we met was John Martin. He is the Vice President of international marketing at DJO. He is not directly involved with any Dr. Comfort products. However, he does have a lot of knowledge about international markets since he is in charge of marketing other medical devices manufactured by DJO in foreign countries. When we met with him, we showed him a list of potential countries that had suitable markets for medical devices based on a list of criteria we developed. He helped us narrow down the list to Australia, Japan, North Korea, Brazil and Russia. Since we initially considered medical channels in all countries, we asked Mr. Martin which countries he would recommend that we focus on. Mr. Martin‘s knowledge about regulatory restrictions and registration processes helped us exclude China from the list. China has a very long registration process for medical devices that could take up
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