New Heritage Doll Essay

Introduction Emily Harris is the Vice president of New Heritage Doll Company’s production division. In mid-September of 2010 she was trying to decide on project proposals for the company’s capital budget meeting in October. Of the proposals presented to her, two of them stood out based on their innovation and ability to strengthen the division’s product lines. The first project, Match My Doll Clothing Line Expansion (MMDC), would extend the warm weather products to an all-weather clothing line. The second project, Design your Own Doll (DYOD), would start with a website where customers would choose the doll’s features, color, etc. and then the dolls will be made to order. The firm could decline both of the proposals because of managerial and financial resource constraints. Other divisions in the company are also expected to promote projects of their own. Because of these factors Harris has to choose to promote one of her division’s projects over the other. The fo llowing questions will help Harris make the best decision for her division and help support her recommendation when communicating back with the divisions executives. 1. Set forth and compare the business cases for each of the two projections under consideration by Emily Harris. Which do you regard as more compelling? The Match My Doll Clothing Line Expansions (MMDC) Project involves expanding the existing successful Match My Doll Clothing line. This clothing line originally consisted of a few sets of matching doll and child clothing for warm weather. Given its current success, there is a consideration to expand it to include all season clothing line. Since it is an expansion to existing product line, investment in operating capital, pricing structure and product cost can be based on historical information. The company should be able to use current sales channels like selling to retail divisions or private labels. New Heritage should be able to outsource manufacturing of this product line expansion to Asia, similar to other existing products. The Design Your Own Doll (DYOD) Project involves creation of new customized dolls to customer’s specification. This project will require new web-based doll-design software. Due to lead time constraints, the company will have to consider manufacturing this made-to-order product line in-house or outsource it to contract manufacturers in USA instead of Asia. This would be a new manufacturing channel for the company. Product cost is expected to be high due to low volume and customized set up. New Heritage Doll Company will have to be thorough when they calculate product cost and price structures for this new product line. This new product will probably be sold through on-line channels only. Without any financial information, the Match My Doll Clothing Line Expansions (MMDC) looks more attractive because it involves less risk and less capital investment and utilizes existing infrastructure and well established sales channels. 2. Use the operating projections for each project to compute a net present value (NPV) for each. Which project creates more value? We assumed that the Match My Doll Clothing Line Expansions (MMDC) Project is a medium risk project since it is an extension to existing successful product line so we used risk-adjusted cost of capital of 8.4%. We believe that project 2 (DYOD) is a much higher risk project since it is a completely new product line for the company and requires an information technology component, so we used risk-adjusted cost of capital of 9%. According to Exhibit 1, the Match My Doll Clothing Line Expansions (MMDC) Project has a Net Present Value (NPV) of $7,150 and Exhibit 2 shows that the Design Your Own Doll (DYOD) Project has a Net Present Value (NPV) of $7,058. Both projects have positive NPV and would create value for the company. However, the Match My Doll Clothing Line Expansions (MMDC) Project has a slightly higher NPV so it would create more value for the company . 3. Compute the internal rate of return (IRR) and payback period for each project. How should these metrics affect Harris’s deliberations? How do they compare to NPV as tools for evaluating projects? When and how would you use each? The internal rate of return (IRR) for the Match My Doll Clothing Line  Expansions (MMDC) is 24.0% based on the NPV calculated above ($7,150). The IRR for the Design Your Own Doll (DYOD) project is 17.9% based on the NPV calculated above ($7058). The calculated IRRs of the two projects do not eliminate either from consideration. Both projects IRR’s are above their individually assigned discount rates, 8.4% for MMDC and the higher (riskier) 9.0% for DYOD. The MMDC Project has an IRR=24%, MIRR=21%, payback of 7.4 years and discounted payback of 9.1 years. The DYOD Project has IRR=17.9%, MIRR=16.4%, payback of 9.1 years and discounted payback of 9.4 years. The MMDC Project has a higher NPV and better internal rate of returns (both IRR and MIRR) than DYOD Project. The MMDC Project has a shorter payback and discounted payback period than DYOD Project. So based on financial analysis, the MMDC Project is more attractive than DYOD Project. The DYOD Project is more capital intensive and even though it might potentially generate higher revenues, it would take longer to generate free cash flow. The NPV is lower for the DYOD Project in this case because it uses higher risk-adjusted cost of capital than the MMDC Project. One point to mention is that the payback period is less sophisticated than IRR or NPV. The payback period looks at the cash flows and determines when the money paid out will be recovered by the benefits of a project. The payback period looks at a project only until the costs have been recovered. This analysis tool is often ignored because it does not take into consideration the time value of money. The time value of money limitation of the payback period can be modified by using the discounted cash flows of a project for the analysis of when the outflows will be recovered. To make the most informed decision the IRRs and payback periods of the projects should be compared in conjunction with the NPVs of the two projects. The NPV analysis of the two projects under consideration indicates that the MMDC Project is the better of the two projects. 4. What additional information does Harris need to complete her analyses and compare the two projects? What specific questions should she ask each of the project sponsors? When comparing the two projects other than comparing the NPV and IRR of each project Harris will need to look at other factors as well. Among the factors that should be considered along with the NPV and IRR, are the manufacturing capabilities, the company’s core competencies, and ensuring that the project aligns with the company’s corporate strategy. With this being said the DYOD Project is at a disadvantage because the MMCD Project is already a successful operation which allows Harris to analyze the historical data as opposed to the project projections of DYOD. Using the factual data provided by MMCD is a less risky option for Harris to choose. In order to ensure that Harris is making the correct decision on which project to select she should ask the following question of each of the project sponsors: Is manufacturing children’s clothing part of the core competencies of New Heritage? Is your project aligned with the mission and long term strategies of the company? What are the differences in New Heritages current market and the doll market? How will scaling up production affect operating and overhead costs? What is the level of risk of the Design Your Own Doll project? Did they consider all hidden labor costs in the MMDC Line Expansion, which are similar to the extra labor costs in the DYOD project? Additionally, it would also be helpful if Harris had information about projects submitted by other departments to make sure that proposed production department projects are in-line with other department projects and an overall company strategy. Even though financially the MMDC Project is more compelling, maybe there is a good reason to pick the DYOD Project. For example, if one of the other divisions is submitting a complimentary project to the DYOD, maybe that would lower the overall risk of the DYOD Project and make it more appealing strategically. 5. If Harris is forced to recommend one project over the other, which should she recommend? Why? Since Harris can only promote one project during the capital budget meeting we would recommend that she support the MMDC Project. Of the two projects presented by her division it has the highest NPV. Financial Management authors Brigham and Ehrhardt state often ‘‘whenever conflicts exist between mutually exclusive projects, use the NPV method†. The NPV method tells us how much a project will add to the value of the company. This is a stated  goal of the New Heritage Doll Company. Also, this project would seem to further solidify relationships with strong customers and gain new ones by broadening the brand and leveraging existing infrastructure.

Decade of Corporate Greed Essay

Ascended in the 1980’s he reinvented Republican policies that favored deregulation and the growth of business in America. These Ideas markedly opposed the views of the governmental interventionist policies of the 1960’s and 70’s with these ideas Reagan hoped to decrease government Involvement and heavy taxes. With these tax cuts Reagan’s thinking was that many new businesses would spawn and that it would have a trickledown effect by not only empowering businesses to grow and hire more people which in the end would benefit all from those on top in the corporate world all the way down to the lowest person in the company in which everyone benefits. This was welcome news not only to the Republicans but also the â€Å"lunch bucket democrats† who were working class democrats who predecessor Jimmy Carter of whom they thought they were ignored by. As a result of this many government services were slashed and created ideas of the government being the problem. With this many republicans encouraged individuals to do good for themselves for the government would not do this for them. With this encouragement of business growth and economic prosperity for as many people as possible individualism became a way of life in the 1980’s. The acquisition of wealth and indicators of it really helped to drive this decade in the 1980’s where it seemed most important to acquire as much â€Å"material† goods as possible. These ideas were also shown in the pop culture world as the artist Madonna made a hit song in the 80’s called â€Å"material girl† a song of the times basically about greed and gaining as material things as you possibly could with no shame of this greed. Also Gordon Gekko the fictional business tycoon in the film â€Å"Wall Street† stands up at board meeting to stress and states â€Å"Greed is good†¦Ã¢â‚¬ ¦Greed will not only fix this malfunctioning corporation called Teldar paper, but also the other malfunctioning corporation called the U. S. of A. † There were even excesses being taken in sports, as Pete Rose of the Cincinnati Reds had greed of singles, doubles and stolen bases, also greed in gambling cost him his spot in Major League Baseball. It was also in this decade baseball experienced â€Å"free agency† destroying loyalties and players selling themselves to the highest bidder as player contracts doubled from just the decade before. Once these Republican policies had trickled down to popular culture it almost seemed to validate this style of politics, it seemed as if the Republicans ascendance to power had spawned this culture and decade of greed that was so actively embraced by the American public. With this these politicians simply stated that they were just acting in accordance to what the public’s wishes were. With this success that Reagan had in the 80’s America had once again began to reassert itself on the world stage after a challenging decade of struggling in the 1970’s. Reagan is thought to be responsible also for the victory in the cold war that had lasted for decades before his term. The new thinking in the 80’s was not that this was greed but more of what the Republicans called prosperity and success. Some of the negatives of these changes were Reagan deregulated everything which in effect destroyed competition and this created oligopolies. Some examples of these are in the airline industry he deregulated the industry causing every airline in the country, except 2 to become bankrupt, as the deregulation in the broadcast industry resulted in just a few major players like Disney and Clear Channel dominating the playing field. As for under the Reagan administration money in politics became more strong then ever and that still holds true today in the world of politics for it seems like we no longer have elections, we more like have auctions for where it seems the candidate who has the most money to spend on getting their name out is usually the one who wins in these political battles, especially for the Presidency. What this does now and back then in the 80’s where it started is a corporation who might want certain laws or tax breaks passed to better help their needs funds that candidate to get elected and then in turn expects them favors to be returned when that candidate is elected. This new concentration of wealth created a whole new class of millionaires, however on the downside for every millionaire there were several hundred homeless people. With this came more negativity that came with the corporate greed of the 80’s. For these people who became homeless and poor due to these millionaires greed were blamed for dragging down the economy by Republican politicians and their mouthpieces in the media, while the truth we found out later is that indeed it was these rich people who were ripping us off and actually were responsible for dragging down the economy. Going as far to blaming the poor the city of Los Angeles installed a fingerprint system to guard against welfare fraud that cost the city and hardworking tax payers 30 million dollars, and for all of this it caught one cheater. While at the same time â€Å"White collar† crime was rising and costing us more than street crime cost, also doing more damage and arguably causing more deaths. Reagan also had a deregulation of the savings and loans industry which was a total debacle and ended up costing Americans 500 billion dollars which is part of the still current banking problem that is going on today. Unfortunately Reagan also began the practice of sending American manufacturing jobs overseas, another move that made the rich even more rich and greedy and made the poor have even less than they did before. Despite all these negatives it can be argued that Ronald Reagan was the most important and influential President of the last 60 years, loved by the Republicans and loathed by the liberals. Reagan turned half a century of political and economic orthodoxy and turned it on its head. It can be argued that he turned those who were Roosevelt democrats. So whether you loved or hated Reagan there is no doubt that administration and the greed of 80’s is still alive today. My though would be if your rich, you like the corporate greed and excessiveness that took place in the 80’s, however if you are poor you are wondering why this turned out like it did.

Bridgeton Management Essay

The ACF plant had cutbacks throughout the 80s as a result of stiff competition caused by foreign competitors entering a market that was dominated by the US auto parts suppliers. As a result of declining market share, ACF is not only in competition with other suppliers but also other Bridgeton plants. The gross profit is declining due to increased costs in direct labor and direct material since 1987. Direct materials cost increased due to the high cost of steel in producing the manifolds. Direct labor cost increased due to the plant using people that were in the retained job pool by the union. More overhead cost was being allocated to remaining products when muffler/exhaust and oil pans were outsourced; as a result manifolds have absorbed a higher cost and are on the brink of being outsourced. Direct labor being cost driver for Overhead allocation, the manifolds product bears a huge portion of the cost of overhead. With the trend in the industry changing and that the manifolds product is as such not yet incurring a loss, I would not recommend it being outsourced for the following reasons: 1. As two important lines – muffler/exhaust and oil pans being outsourced, the Overhead rate significantly increased from 435% to 566%. Despite of significant improvements in the production of manifolds and reduction in overall overhead costs, the fixed costs associated with other lines was burdened on to the manifolds product line. If outsourced, possibly the manifolds burden (like the muffler and oil pans) would shift to another product, which would in turn result in the plant shutting down. 2. As the auto industry is driven more by machines and labor and as plants being more machine intensive than labor intensive, having direct labor, as the cost driver for overhead allocation could be incorrect. The plant should have overhead allocation based on machine hours instead, which would give a better allocation base. 3. If emission standards increased, which would be in favor for the plant, they could increase the selling prices of their manifolds. In the auto industry is could be very likely of the industry demanding a higher emission standard that could only be profitable to Bridgeton.

Litigation public relations Essay Example | Topics and Well Written Essays - 500 words

Litigation public relations - Essay Example One should remember that litigations against companies are only brought about when there is a strong suspicion of wrong-doing, and the litigation is raised usually by competing companies or the general public. While lawyers can argue that every company has the right to defend itse is lf, PR managers on the other hand usually act out of loyalty as well as their own investments in the company. In this sense, one can see that ethics are not the primary motivation for LPR exercises. As opposed to publishing and reporting the truth as it exists, LPR efforts attempt to color this truth and make it favorable to the company's cause. This might ultimately prove beneficial to the company by reducing negative publicity and consequently not affecting its bottom line, but the general public and the broader industry might suffer due to the misinformation being generated. To be fair to the defendants, one has to concede that media coverage generally tends to be hostile to them. For example, most la w-suits are covered from the viewpoint of the plaintiff or the prosecutor and their case gets presented in greater detail. There is a slight negative bias toward the defendant, for they are deemed as wrong-doers until proven otherwise.

Marketing Planning Assignment Example | Topics and Well Written Essays - 2750 words

Marketing Planning - Assignment Example Some dangled the benefit, some the direct offer, some contained a pricing cut, some concentrated on branding and gave away free items such as T-shirts. The goal was to determine the best motivation for customers that would make them purchase the car or, at the very least, show some interest on the product. They determined that the price discount is the best motivation. The $0 down offer resulted to 71 percent more direct responses than all of the other marketing offers they’ve launched in the past. He also went further by getting looking at where the customers came from, what they do, and their gender (Clifford, 2009). Mr. Herman used the data to convince Vespa that the $0 down is the most effective marketing offer and it is what should carried by the advertising agency. From the glory days of the glamorous Madison avenue, marketing has always been about creative images and catchy taglines but the current utilities available to businesses are allowing the collection of data to predict behaviour, determine climate of marketing environment and discover the most effective business strategy that to increase branding and revenues (Brennan, 2008). Such innovation could readily allow Starbucks to change its marketing strategy as dictated by the market. It is a true market – led strategic change. ... The Social assessment is a critical aspect because it examines the mainstream culture and how society will react to a product. Technology also affects the business. As new equipment and processes are developed, creating new products and producing the existing line becomes easier and more efficient. All these factors play a part in the marketing and affect the profitability of the company. b) Apply organisational and environmental auditing techniques to Starbucks. Starbucks is one of the very few companies who have the opportunity to establish an intimate relationship with its consumers (See figure 2 to see how Starbucks uses its IT) because of the different government policies that allowed it foster. It was able to advance its products, exercise freedom on designing marketing problems, advertising materials, and design its retail stores to reflect the image of freedom it projects. It is necessary to determine exactly how the US government was able to support this growth through the p olicies it set up such as business laws, taxes, employee rights, and others. For example, Starbucks enjoy big tax breaks on its environmental efforts. It has long supported recycling and the use of sustainable materials. It also provides incentives to customers who use their own cup when they go to Starbucks. Such efforts earn Starbucks as much $5,000 tax incentives for every $100,000 investment. The rate changes from state to state but nearly every State in America provides incentives. It can also enjoy tax incentives provided to big corporations. It is possible for Starbucks to measure the effects of these policies further by setting up a data-centered

Research skills assignment one Essay Example | Topics and Well Written Essays - 1750 words

Research skills assignment one - Essay Example ill be discussed in this paper to identify the most suitable and appropriate methods and techniques that help to get the desired results and offer the public the much required information. Political surveys are also commonly known as the opinion polls. They are at times simply referred to as polls. They are conducted in the form of polls or public opinions that are obtained from a particular sample. These political surveys or opinion polls are common in a majority of the countries all over the world. They are mainly witnessed during the national elections or in rare cases when there are votes to be taken in the different corporate organizations. The main purpose of the political surveys is that they are designed to act as a representation of the opinions of an entire population through the conduct of a series of questions. They are in this case conducted to reflect the actual results of the true operations. Anderson and Pickup (2010, p. 243) illustrate that these are followed by the extrapolating generalities of ratios that are done within the present confidence intervals. Thus, the research methods that are used to conduct the opinion polls must be as suitable and re liable as possible in such a way that they minimize the rate of bias and can reduce the disparity between the results collected during the opinion polls and those that are obtained on the actual performance of the voting process. During the conduction of opinion polls, there are a number of methods and techniques that are used. These are meant to ensure that the results obtained in the surveys are as accurate as possible. In addition, they provide the ability to get precise results. Over the years, the various opinion polls have been maintained through telecommunications or through contacts between one person and another. Thus, there are varied methods and techniques. However, they are acceptable from region to region. Some of them include the ballots, verbal and processing forms which are commonly

Representation of New Zealand masculinity in beer advertising Essay

Representation of New Zealand masculinity in beer advertising - Essay Example This "Representation of New Zealand masculinity in beer advertising" essay outlines the connection between traditional New Zealand's sports games, masculinity and how media used this in a beer commercial. During peace times rugby was one of the sporting events in which the Kiwis took pride. Rugby gave a feeling of masculinity and enhanced manhood to the Kiwis in the early years. When Edmund Hillary along with tensing reached the world’s highest peak, it was taken as an expression of New Zealand’s Anglo-Saxon manhood. He depicted colonial honesty. This Kiwi hero had a warm and caring heart who dedicated his life to the concern and welfare of the people of the Himalayas. Peter Snell, a gold medalist at the Rome Olympics, became the personification of Kiwi manhood. He too had immense muscular strength and was extremely modest. These were connected with masculinity but along with these, the culture of beer and alcohol added to the image of manhood. The New Zealand man had an image of being strong, resilient, and modest. He could hold his own drink, yarn with his mates, and eventually settle down as a family man. Hence, beer, alcohol, muscles, murder, adventurous activities, was all associated with masculinity. What added to the image was that after all this, such a man was even a successful family man. These ‘good keen men’ of Barry Crump won secret admiration from the male counterparts. As family bond strengthened in New Zealand, men started identifying themselves with the traditional heroes and the male culture.