Hallstead Jewelers Case Study Essay

Assuming that the company’s goal is to maximize profits, the current cost system is not an appropriate tool for strategic planning. The ambiguity of the overhead costs per product makes it difficult to accurately analyze the cause and effect relationships of changes and/or improvements to specific product line.

The price increase must be enough to cover the additional fixed cost, so we just need to know what that fixed cost is per copy sold. This equals the additional fixed costs / number of copies sold.

Breakeven Analysis for Product Tylenol Approach 1 - Same price as Tylenol Approach 2a - Cheaper than Tylenol Approach 2b - Cheaper w/lowered trade cost $ $ $ $ Unit Cost (Variable Cost) 0.60 0.60 0.60 0.60 Trade Cost (Selling Price to Retailers) $ 1.69 $ 1.69 $ 1.05 $ 0.70 Fixed Cost (Advertising) 2,000,000 6,000,000 6,000,000 6,000,000 Break-Even Quantity [Fixed Cost/(Trade Cost-Unit Cost)] 1,834,862 5,504,587 13,333,333 60,000,000 Contribution Margin (Unit) 64% 64% 43% 14%

There would still be a net loss in 2006 due to the increase of break-even point, which increased from $7,505 to $8,640.

3) The breakeven analysis is likely to be more important for a fixed fee performer because the fixed costs are higher (because of the talent cost), and there is a greater risk from poor attendance at the event.

In our second assumption, instead of using the cost of goods per cases in 1986, we try to use the percentage it counts in the total expenses which is 50.4% and to find the sales needed to break-even. The detail of the calculation is shown in the answer for questions d. The result is that 95,635, a little bit higher than the estimated sales of 90,000.

4. Now focus solely on the expected profitability of the proposed marketing program. How many incremental daily visits must the program generate to make it worthwhile? (In other words, how many incremental visits would it take to pay for the marketing program, irrespective of overall clinic

There is certainly a market for this product. It is the market that is currently dominated by asbestos pad and micarta slab users, and is comprised of uneducated (about cushion pads) and price-sensitive customers. Prior to CMI’s involvement, “the pile-driving industry had paid very little attention to cushion pads.” There was no dominant manufacturer, little-to-no branding, and ambiguous distribution channels.

1. Williams-Sonoma has experienced strong growth in the past year, but this is on the back of a strong economy and in particular a strong new home market. The furniture business is strongly correlated with the strength of the real estate market. In this respect, the company's strategy is largely irrelevant, because within the next five years the real estate bubble will burst and Williams-Sonoma will suffer a major downturn in its own results as a consequence. However, this reality shows that the company perhaps lacks sufficient differentiation, and can only be expected to perform roughly in line with the housing market. It is neither outperforming competitors nor is it underperforming. W-S has sufficient differentiation within the furnishings and home products segment, and has a fairly strong brand name in the segment. The company's status as a mass-market premium company allows it to grow strongly in strong economic times, but also makes it particularly vulnerable to economic downturn, because not only do consumers redecorate at greater intervals, but they will trade down to more affordable stores when they do.

Maupassant effectively portrays a marriage that is misunderstood through manipulation, distrust, and deception. He does this by describing each individual, the couple in relation to one another, as well as their lifestyle.

In the case study, as the annual fixed cost is $6,000,000 and the contribution margin per event is $1,900. Therefore, the breakeven point is at the 3,158

It is particularly interesting to note that the higher the fixed costs, the higher the break-even point. Thus, companies with large investments in equipment and/or high administrative-line ratios may require greater sales to break even.

The newspaper theory was used to complete the sales data, but this data point should be considered a soft number as it is based off of a newspaper assumption. Break-even analysis uses the formula of Sales = Variable costs + Fixed costs + Net income (Kimmel, Weygandt, & Kieso, 2009).

Today they have their direct selling through their website, catalogues, and print in high fashion magazines, so more print, TV and radio maybe an option for them. However, Tiffany & Co. are very upscale and not many upscale retailers advertise on TV or radio, but it could be an option because those are avenues in which the competition utilizes and it is an area in which Tiffany[‘s have yet to tap into. In order to increase or grow their business by 10% Tiffany & Col must acquire new customers by developing/implementing products that are inexpensively priced to reach out to a new market segment, while still having the Tiffany quality; must enhance customer awareness by developing/implementing new marketing strategies such as direct mail, sending catalogues to customers in and around the stores area, look into tasteful T.V. and/or radio advertising.

This scenario is a case of company law. I will be advising Will and Kate as to the legal possibilities in regards to the different facts in this case.