Reference no: EM132719259

Problem - Strategic initiatives - Springbok Strikers Inc. is a South African company that has developed a new strategic initiative aimed at increasing profits. Currently, the company's operating profit is 8% of sales, but the company wants it to be at least 12%. The new initiative is to open two new markets-the United States and Great Britain-where the company has not sold before. The company's current monthly volume of sales is $5 million. The initiative is expected to bring in an additional $2 million and $1.5 million of monthly sales from the United States and Great Britain, respectively, without any cannibalization of current revenues (i.e., the additional sales to the United States and Great Britain will not take away from the current monthly sales volume of $5 million). Determine what the combined total operating expenses of the two initiatives would need to be for the overall strategic initiative to achieve the company's target operating profit.