Surefire Executive Summary

4) Due to the rebounding industry growth rate of 15% in 2011 comparable to the explosive CAGR of 16.1% from 2003-2008 combined with the partial opening of the new plant in Slovenia, OH Rates are most likely to increase with higher volume orders and larger scale operations. This in turn will decrease our bids and make it more attractive for prospective clients.

Only the incremental costs and benefits are relevant. In particular, only the variable manufacturing overhead and the cost of the special tool are relevant overhead costs in this situation. The other manufacturing overhead costs are fixed and are not affected by the decision.

Wilkerson’s competitors have cut prices on their pumps, in order to maintain market share, Wilkerson also cut the price of their pumps. This dropped Wilkerson’s GM by about 15%. At the same time, Wilkerson was able to increase the price of their flow controllers by 10% without a drop in demand.

As we continue to move toward the end our quarterly objectives. I wanted to take the time to explain some of our costs. In our particular field of designing and manufacturing products, we are always engaging in ways that we can mitigate loss and improve our processes. Performing such changes will give a stronger presence in the market by allowing us to remain competitive.

Wilkerson employs a Normal Cost System, which means that they use predetermined overhead rates along with actual costs for direct material and direct labor. Normal costing systems are appropriate when overhead costs are a relatively small percentage of total manufacturing costs and product diversity is limited. For Wilkerson, normal costing does not make sense. Overhead costs make up over 50 percent of total manufacturing costs and their product offering is relatively more diverse. This indicates that the current accounting system in place may be distorting costs significantly. Supporting data:

In order to meet customer demands for higher product quality, to comply with federally-mandated environmental regulations, and to reduce production costs, HCC must spend $2,000,000 within the next three years to upgrade equipment. The upgrade is expected to result in production efficiencies that will lower material and labor costs by reducing defective products, process waste, in-process inventory, and production man-hours through simplified work processes. It has been over a decade since significant modifications were made to the production facilities. Those changes were mostly technical in nature and did not substantially alter work processes or reduce overall employment. The average productivity gain in the industry for the past five years has been 3% per year. Financing for the loan to purchase the equipment

However, a proposed plan may be to increase prices within a particular channel, namely the mass merchandisers. In line with exhibit 3, which shows the only total year volume growth for CY00 in all channels of 3.5%, an acceptable price increase is 5% for this particular channel. Based on the weighted average price increases (exhibit 4) of Royal Oak and Private Label, a 5% increase for Kingsford sits between the increases of the last year that were offered by both these brands, exempting the instant 15# category.

Data indicates that Model C210 has a higher contribution margin per unit of the constraint. Therefore it is recommended that until the constraints in coating and sharpening are removed, production should concentrate its limited resources on production of the more profitable model. The Model C210 contributes $1250 per hour compared to $537.50 per hour given the constraint in the coating and sharpening stage.

We continued to estimate a decline in NiMH sales, lowering our forecast to $21M which also mirrored the sales figure in 2012. However, we forecasted a sharp increase in Ultracapacitor sales with a 2013 sales estimate of $6.9M which is also the 2012 sales figure. (Break-through?) The price of the NiMH was lowered to $8.50 due to increasing market pressure, but we left the price of the Ultracapacitor the same. We kept our R&D investments in process improvement the same for both the NiMH and Ultracapacitor, but decreased our investment in NiMH energy density to $2M. The decision to decrease this investment was based on the decline in sales for this product.

With Alex the school thing is tough but he still can turn it around so be positive. It has to be hard to move out and move to new city with so much going

If we compare the old job costing method with the Activity based costing method we can see in the table below that the activity base rate gives us a much more accurate insight in allocating the manufacturing overhead costs. In fact, the activity based overhead calculation shows us that the activity rates for Valves and Pumps are lower than the rates used in plantwide production rates, but the activity based rate for Flow Controllers is around 50% higher than the cost calculated in the job costing method. The reason for this difference in our opinion can be traced back to the high receiving and production control costs as well as packaging &

Simplete will provide 11 employees with Dell Desktops and 3 employees with iMacs for work. We will also be providing 4 employees with 12.9 inch iPad Pros and 3 employees with 9.7 inch iPad Pros for work. Simplete will purchase 2 Xerox WorkCentre 3215 multifunction printers. They will be able to wirelessly print, copy, scan, fax, and email all from the printers.

With their overhead being set at 300% that means they are increase the normal rates up larger than needed, per each line of product. This has created a bit of an issue for the company as well since the gross margins for the pumps are down lower than expected.

The company can also ensure the installment of fire extinguishers and fire exit doors within the firm’s premises to create better channels of evacuation during fire outbreaks. In addition, smoke detectors and alarms should also be installed to signify and create warnings in case of such.

Fire Safety Inc. has a very well established brand name in the domestic market holding a leading market share of 58%. FSI estimates that the market will grow by 44% in 2002. For the past 11 years, the HERO lineup has enjoyed increased sales year to year by providing top of the line Digital Breathing Apparatus Systems. Currently, FSI is the leading manufacturer and distributor of these systems. Despite the 5% increase in price for 2001, sales have increased showing no signs of market response. Our competition has their product line set at a slightly lower price (1500$/unit) which indicates a clear weakness in an established market led by our company.