project when sales will fall below the profitability line, marketing homework help

Q1:

Imagine that
you manage a production line. To be profitable, your line must sell at
least 500 products per month. Sales are currently waning, as the market
for your product has become saturated by competitors’ products.

In the future, another product line is planned to replace your
current line, as the product becomes unprofitable. You will manage the
new production line, and your team will stay intact. The program office
has asked you to project when sales will fall below the profitability
line. The historical sales figures are as follows:

Based upon historical sales figures and in light of the 500 product minimum sales threshold, provide the following information:

1. Determine
   which forecasting method is most appropriate for the problem. Explain
   why your choice is optimum and why other methods are not as effective.
2. Perform an empirical analysis – establish a forecast for when sales will fall below the profitability threshold.
3. Report to the program office with a recommended date that the production line should be converted to the new product.

Your
submission should be 2-3 pages in length (excluding the title and
references pages). Be sure to use appropriate line spaces between each
question, so that your work is organized and easy to follow. Your
assignment should follow APA guidelines by including a title page, be in Times New Roman, 12–point font and double spaced. Be sure to use APA-style citation when citing sources to support your claims.

Q2:

Company

Harvey Industries, a Wisconsin
company, specializes in the assembly of high-pressure washer systems and
the sale of repair parts for these systems. The products range from
small portable high-pressure washers, to large industrial installations
for snow removal from vehicles stored outdoors during the winter months.
Typical uses for high-pressure water cleaning include:

Industrial customers include: General Motors, Ford, Chrysler, Delta
Airlines, United Parcel Service, and Shell Oil Company. Although the
industrial applications are a significant part of its sales, Harvey
Industries is primarily an assembler of equipment for coin-operated,
self-service car wash systems. The typical car wash is of concrete block
construction with an equipment room in the center, flanked on either
side by a number of bays. The cars are driven into the bays, where the
owner can wash and wax the car, utilizing high-pressure hot water and
liquid wax. A dollar bill changer is available to provide change for the
use of the equipment and the purchase of various products from
dispensers. The products include towels, tire cleaner, and upholstery
cleaner.

In recent years, Harvey Industries has been in financial
difficulty. The company has lost money for three of the last four years,
with the last year’s loss being $17,174 on sales of $1,238,674.
Inventory levels have been steadily increasing to their present levels
of $124,324.

The company employs 23 people, with the management
team consisting of the following key employees: President, Sales
Manager, Manufacturing Manager, Controller, and Purchasing Manager.

Current Inventory Control System

The
current inventory control system consists of orders for stock
replenishment made by the Stockroom Foreman, the Purchasing Manager, or
the Manufacturing Manager whenever one of them notices that the
inventory is low. An order for replenishment of inventory is also placed
whenever someone (either a customer or an employee in the assembly
area) wants an item, and it is not in stock.

Some inventory is
needed for the assembly of the high-pressure equipment for the car wash
and industrial applications. There are current and accurate bills of
material for these assemblies. The materials needed to support the
assembly schedule are generally known well in advance of the build
schedule.

The majority of inventory transactions are for repair
parts and supplies used by the car washes, such as paper towels,
detergent, and wax concentrate. Because of the constant and rugged use
of the car wash equipment, there is a steady demand for various repair
parts.

The stockroom is well organized, with parts stored in
locations according to each vendor. The number of vendors is relatively
limited, with each vendor generally supplying many different parts. For
example, the repair parts from Allen Bradley, a manufacturer of
electrical motors, are stocked in the same location. These repair parts
will be used to provide service for the many electrical motors that are
part of the high-pressure pump and motor assembly used by all of the car
washes.

Because of the heavy sales volume of repair parts, there
are generally two employees working in the stockroom – a Stockroom
Foreman (who reports to the Manufacturing Manager) and an Assistant (who
reports to the foreman). One of these two employees will handle
customer orders. Many customers stop by to order the parts and supplies
they need. Telephone orders are also received and are shipped by United
Parcel Service the same day.

The assembly area has some inventory
stored on the shop floor. This inventory consists of low-value items
that are used every day, such as nuts, bolts, screws, and washers. These
purchased items do not amount to a substantial dollar volume throughout
the year. Unfortunately, oftentimes the assembly area is out of one of
these basic items which causes a significant amount of downtime for the
assembly lines.

Paperwork is kept to a minimum. A sales slip
listing the part numbers and quantities sold to a customer is generally
made out for each sale. If the assembly department needs items that are
not stocked on the assembly floor, someone from that department will
enter the stockroom and withdraw the necessary material. There is no
paperwork made out for the items needed on the assembly floor.

There
were 973 different part numbers purchased for stock last year and those
purchases amounted to $314,673. An analysis of inventory records shows
that $220,684 was spent on just 179 of the part numbers.

Fortunately
for Harvey Industries, most of the items they purchase are stocked by
either the manufacturer or by a wholesaler. When it is discovered that
the company is out of stock on an item, it generally takes only two or
three days to replenish the stock.

Due to the company’s recent
losses, its auditing firm became concerned about the company’s ability
to continue in business. Recently, the company sold off excess vacant
land adjoining its manufacturing facility to generate cash, in order to
meet its financial obligations.

Due to the recent death of the
owner of Harvey Industries, the Trust Department of Milwaukee Bank (as
trustee for the estate) has taken over the company’s affairs and
appointed a new company President. This President has identified many
problem areas, one of which is improper inventory control. He has
retained you as a consultant to make specific recommendations concerning
a revised inventory control system.

Through a case analysis, provide your recommendations for managing inventory levels and workload scheduling.

A
case study is a short description of a real business situation.
Analyzing case studies gives you the opportunity to apply those concepts
to real business problems. Cases are generally written for several
types of analysis. Usually, there is not a “right or wrong” answer.
Rather, cases provide a vehicle for you to demonstrate your
understanding and ability to apply course concepts. You must use
appropriate sources (properly cited) to support your position. Check
your analysis by assessing how well it demonstrates your subject
knowledge. If your answer relies on your impressions of the topic prior
to taking this course, it is likely that the analysis is not your best
effort. Simply answering the questions which are part of the case is not
enough; consider the questions to be clues to the important concepts
and facts. You are strongly encouraged to use the following outline, so
that your analysis is organized appropriately:

• Identify both
  the key issues and the underlying issues. In identifying the issues, you
  should be able to connect them to the business principles which apply
  to this situation.
• Discuss the facts which affect these issues.
  The case may have too much information. In your discussion, you should
  filter the information and discuss those facts which are pertinent to
  the issues identified above.
• Discuss your tentative solution to
  the problem and how you would implement your solution. What actions
  would you propose to correct the situation, based on the knowledge you
  have gained in this course? Be sure to support your recommendation by
  citing references in the text and in the supplementary readings. You
  should also draw on other references such as business periodicals and
  relevant journals. Remember that an ANALYSIS is more than simply a
  SUMMARY of the Case Study.
• Discuss follow-up and contingency
  plans. How will the organization know that your proposed solution is
  working? What should they do if it does not work?

Your
presentation should cover the points listed above. By “role-playing” the
situation, using the questions at the end of the case as hints, and by
using this guide, you should be able to develop an action-oriented
analysis with a recommended course of action.

Your case analysis

should be 2-3 pages in length, not including the title and reference

pages. Include at least two articles/materials to support your analysis.

All citations should be in APA 6th edition format. Double space your

paper, use Times New Roman, 12-point font, with one inch margins.