Case-dark and bold inc

Assignment Help Business Management
Reference no: EM131155547

Case- Dark and Bold Inc.

You are a Consultant for the professional service firm, BUSI 2083 LLP. Your firm specializes in providing a wide variety of internal business solutions for different clients. A consumer business partner within the firm notices your availability at 3:00pm on a Friday afternoon and pulls you into a meeting with one of his high profile clients.

Background

Dark and Bold Inc. manufactures a line of single-cup brewing machines for home and office use that brew a cup of coffee, tea, or hot chocolate in less than a minute. The machines use specially packaged portions of coffee, tea, or hot chocolate that can be purchased online directly from Dark and Bold or at Second Cup coffee shops who are licensed to distribute the company's products. The appeal of the brewing machines is twofold. First, they offer a high level of convenience. The use of prepackaged coffee servings means no grinding of coffee beans and no mess. Also, the brewing machines have a water reservoir that for some models is large enough to make up to 20 cups of coffee. Second, the taste of each cup of coffee, tea, and hot chocolate is very consistent. The brewers' pressurized system uses the same amount of water for each cup and the airtight seal used in the individual portions keeps the product fresh.

Additional Information

The company has three models of brewers that offer different features, such as the size of the water reservoir, the number of brewing sizes, and the types of filtering devices used in the machine. Data from the most recent fiscal year for the three models is shown below.

Home Brewer

Office Brewer

European Deluxe

Sales volume (units)

12,000

30,000

6,000

Unit selling price

$150

$200

$300

Variable cost per unit

120

140

180

Contribution margin per unit

$30

$60

$120

Fixed costs are $1,500,000 per year. The company has no work in process or finished goods inventories. The company is facing increased levels of competition from manufacturers using similar brewing technologies and believes there is no room for any increases in unit selling prices.

Dark and Bold Inc. is unsure of the strategies to take in order to increase profitability. The engagement partner would like the following questions on his desk by Monday morning:

Required:

The company is considering adding a new product to its line of brewers targeted at the office use market (both the Office Brewer and European Deluxe are currently targeting office users). The new brewer, the Office Plus, would sell for $250 per unit and would have variable unit costs of $160. Introducing the new model would increase fixed costs by $102,000 annually and would reduce annual unit sales of the Office Brewer and European Deluxe models by 10% each. Assuming no change to the sales of the Home Brewer model, how many units of the Office Plus would need to be sold to justify its addition to the product line next year?

Reference no: EM131155547

Questions Cloud

Defining the army and stem fields on basis of requirements : It is important to evaluate the position women have in the society. By evaluating the social, cultural and economic factors that impact feminine personalities, it is possible to explore how the contemporary status of women affects their stability...
Affecting intellectual property laws : Increased digital communication may pose a threat to intellectual property because technology allows people to create perfect clones of original works. How do you think the Internet is affecting intellectual property laws?
• develop a thesis statement and strong supporting subtopics : Develop a thesis statement and 3 strong supporting subtopics. Create a topic sentence outline (scheme strategy). Prepare a first-draft essay.
Build a hedge fund strategy : Build a hedge fund strategy for expert's judgement.- tudy the profits of momentum (trend) or reversals (counter-trend) in equity, industries, commodities, FX, or other markets.
Case-dark and bold inc : You are a Consultant for the professional service firm, BUSI 2083 LLP. Your firm specializes in providing a wide variety of internal business solutions for different clients. A consumer business partner within the firm notices your availability at..
Advantages of new and unusual motivation techniques : Overall, what do you think the main advantages and disadvantages are of these new and unusual motivation techniques as compared to more traditional techniques
Identify the professional fit for advanced nursing role : Identify the professional fit for advanced nursing role. Implement your new nursing role in the organization. Identify a board of nursing in your state (specifically the Nurse Practice Act), which would support your role in this type of organizatio..
Implement learning technologies impacts : Learning organizations come in all shapes and sizes. How an organization chooses to implement learning technologies impacts how performance can increase. Development of tools, resources, and products are only the start to improving processes that ..
Find the total line current drawn by the motor : Find the total line current drawn by the motor when the developed torque is one-half the rated value.

Reviews

Write a Review

 

Business Management Questions & Answers

  Birth of a product from concept to commercialization

Essay Question: Describe the process of the "birth of a product from concept to commercialization," including all production, distribution, and marketing aspects. The product or service is up to you.

  Identify the major loss exposures

Assume you are a risk management consultant. Identify the major loss exposures that Kimberly faces.Assume that a covered loss occurs in July, which damages part of the inventory.

  Explain voc and svoc

1. Explain VOC and SVOC and discuss their potential sources as related to indoor air quality. 2. Summarize how and what type of hydrocarbons may be formed specifically by anthropogenic activities.

  Defining warehousing and discussing its strategic role

Discuss the role of warehousing in a logistics system.

  Incentives in motivating to increase performance levels

What forms of incentives are most effective in motivating you to increase your performance levels? What forms are the least effective?

  Company research-investigate small companies

Have you given much thought to whether you'd be happier working for a small company or for a big one? Here's your chance to compare and contrast the opportunities that small companies and big companies offer. First, read the article -Company Re..

  Scholarly writingwriting well is a hallmark of good

scholarly writingwriting well is a hallmark of good scholarship scholars try to make sense of the world through

  The main objective of business statistics

The main objective of Business Statistics is to make predictions and decisions about certain characteristics of a population based on information contained in a random sample from the entire population. The condition for randomness is essential to ma..

  Etch-a-sketch ethics

Is it possible, as Mr. Killgallon claims, that the Ohio Art Company had no knowledge of labour problems at Kin Ki? Do you think company executives had any knowledge of the working conditions?

  Valid contract-cancellation clause

Did Montgomery and Manning form a valid contract? Would your answer be different if the cancellation clause had been in every policy between Montgomery and Manning, or if this were the first time there was such a clause?

  What experiences formed the source of your intuition

Describe a recent decision you made that relied on intuition. In your opinion, what experiences formed the source of your intuition? Did the decision lead to attainment of the desired outcomes

  Wanting to save the currency

Wanting to save the currency she would have to pay for a commission Marsha asks her friend Howard to check on the Internet as well as see if he can find a five-day cruise to the Bahamas for under $400 and if he does to book it for her. He agrees h..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd