Professional Documents
Culture Documents
Action Steps
Reposition a product
Marketing a product
Scheduling production
Estimate a best case for demand for each product this year
Display the Production worksheet
Observe existing inventory
Schedule production to meet best case demand less existing inventory
Save the decisions
Estimate peak demand for each product for this year and next year
Examine unit costs and margins
Display the Production worksheet
Increase or decrease capacity as required
Increase automation as required
Observe the net cost of the investment
Display the Finance worksheet
Fund the investment with a mix of stock issues, bond issues, and
depreciation
Save the decisions
Useful formulas:
Contribution Margin($) = Price -_ (Material Cost + Labor
Cost)
Margin Percentage (%) = Contribution Margin/Price
Margin Potential = Maximum Price possible Minimum Unit Costs possible