Simulation Analysis Report On Operation Period Ending

In the real competition, we will still use the broad differentiation strategy in the first round. We will make our products better than the market with an affordable price. By using this method, we create a brand image and customer loyalty. Over time, brand recognition will lead to greater company profitability. In the second round, we will still improve all of the products’ performance and size, in which it has to be better than the market. For the price, we will keep it same

BaldWIN’s first key performance indicators are based around the marketing sector. The company remained competitive in the industry in customer awareness for its product Baker (61% awareness) and the goal is to increase awareness to 65%. Team BaldWIN’s product accessibility after round three was 55%, which we aim to increase by 10-20%. $250,000 will be invested each year BaldWIN’s promo and sales budget for each current product to meet these goals.

Identify ad explain the sources of the change in Baldwin’s profitability from Year 2 to Year 3 with a view to evaluating its current earnings quality and future prospects.

Over the period 2012-2014, leverage decreased from 49.01% to 46.94% then it increased to reach 49.04% last year. Leverage is the amount of debt that Myer uses to buy more assets. An excessive amount of leverage raises the risk of failure, because it becomes more difficult for the firm to repay their debt. Furthermore, it can earn outsized returns for the

Baldwin implemented the Board Differentiator strategy. This company has competed with their product in all five segments. Their prices

3)Attempting to remedy the situation, the firm cut its dividend in 1974 and 1975 and drastically reduced its working capital investment they turned to debt financing. Du Pont's debt-to-equity ratio rose from a conservative 7% in 1972 to 27% in 1975 while the interest coverage ratio fell from 38 to 4.6. The increased debt ratio shows that they were moving towards a higher leveraged position and aggressively financing growth with debt. The reduced interest coverage indicates that Du Pont was now more likely to be unable to meet the required interest payments on its debt.

The purpose of this report is to analyze the current market situation of the company and to recommend courses of action to address the question raised above.

This paper addresses the solutions to Case Study 12.31 and 12.32 in the textbook authored by David Marshall, Wayne McManus, and Daniel Viele “Accounting; What the numbers mean.” Both case studies bring about a better understanding of operating and financial leverage. This discussion includes the return on investment, return on equity, contribution margin, and break-even point. All these terms associate with the two types of leverage.

A company 's financial statements and ratios are good indicators of its performance over the years. This report specifically compares the ratios for 2004 and 2005, with some additional insight into 2003, 2002, and 2001.

Leverage ratios are measured to identify the amount of borrowed fund used to finance firm’s operations. Leverage ratios consist of Debt-to-Asset and Debt-to-Equity ratios. In 2012, the Debt-to-Asset ratio of Inditex was 0.32 which is considered good for company’s economy as long as it is less than 0.4 (Table 2). In other words, company is not excess using debts. The Debt-to-Equity ratio for Inditex in 2012 was 0.47 which is in company’s favor as it is less than 1. This shows how leverage is well managed by the company. Comparing to rivals, Gap was scored 1.69 for Debt-to-Equity and 0.63 for Debt-to-Assets which is not in company’s favor and therefore

The consumer driven strategy adopted by the company at the time was innovative as instead of telling the consumer what to like the company brought them products that

in order to deliver superior “highly customized products to high growth markets” (Bucifal, 2009). This new strategy hearkened back to the companies original differentiation strategy, and emphasis

In the traditional segment customers were focused on purchasing a reliable product that incorporates the current markets technology. Our overall company strategy of broad differentiator was the strategy we decided to incorporate in this segment. We felt as if in this market if we could take the technology that is already in use and apply it to a superior brand product, we in turn could charge a premium price for an ideal product. We begin with the size aspect of our Fast product in the traditional segment. Over the years we manage to strategically adjust our size factor to the most ideal position of the market in order to attract customers with a size factor influence as well as a cost factor keeping our product at premium prices until the end where the price was shifted towards a low cost differentiator. Although we shifted in price and size, we kept our MTBF consistent in order to brand our traditional market product as very dependable product. The age factor was a major influence in this segment. We managed to combat this factor with various revisions throughout the years in order to maintain competitiveness of the product. Throughout the years this product was not the strongest performer as the first couple of years or so, poor performance results in regards to market share and customer satisfaction almost lead us to believe that we needed to spin off this business segment. We began with selling off chunks of our

(p. 09). Companies with such brands however, still face the challenge of pushing their products, increasing market share and ensuring brand loyalty while being faced with the challenge of cheaper competitive products and alternative products being introduced in the market. There are the key selling points that branded products have like consumer loyalty but companies have to keep thinking of new ways of ensuring that these products still remain being the preferred product even when they are more expensive than the rest. Differentiation is a great strategy but it cannot help in maintaining customer loyalty, so there has to be a way through which a company collects information that is vital in helping decisions in regards to maintaining a product being the preferred choice for the consumers. (Batra, Ahuvia & Bangozi, 2012).

But at that point of time, the company had a wide range of brands/subbrands. The focus of the company was on product innovation and service network and managing quality proposition.