Budget Development
Budget Development
When planning a budget for any new product or service is an important step in any new building of a product. Knowing how much money that the company has available to spend on marketing and promotion of the new product is key. Sticking to that budget is away to show that the Nike Company can stay on track and stick to the plans and follow through with commitments will make the company better. When planning a budget for a new product there are many items to keep in mind without a good plan behind the budget the budget will not work.
When developing a budget there is four major numbers that should include project sales, revenue, total project cost of achieving the level of sales and revenue, the profit or loss from operations based on the previous numbers, and the total of profits and losses over time(Tracy, 2004). The estimate of sales is the most important number in the budget. This is a result of a complete analysis of the marketing and sales activities (Tracy, 2004). The numbers should be easy to predict, this would include high, medium, and low sales estimates. When launching a new product basing the budget on a percentage of the predicted sales will work well with Nike because the company is very well established. Last year alone Nike spent 240 billion on TV advertising alone, plus all the sports affiliations on star like Colby Bryant and Tiger Woods, plus magazines, newspapers, radio, and the Internet and many more advertising devices (Nike, 2010). This adds up to 800 billion in advertising each year. This energy bar will only be a small part of the advertising bill but will bring much benefit to the company (Nike, 2010).
The new product will have a budget of 25 million dollars that Nike will have as a budget. The media that the company will use is TV adds, magazines, and at sports events. While planning the budget is one of the most important for a new product ensuring that the funds of the budget are being allocated to all the
When planning a budget for any new product or service is an important step in any new building of a product. Knowing how much money that the company has available to spend on marketing and promotion of the new product is key. Sticking to that budget is away to show that the Nike Company can stay on track and stick to the plans and follow through with commitments will make the company better. When planning a budget for a new product there are many items to keep in mind without a good plan behind the budget the budget will not work.
When developing a budget there is four major numbers that should include project sales, revenue, total project cost of achieving the level of sales and revenue, the profit or loss from operations based on the previous numbers, and the total of profits and losses over time(Tracy, 2004). The estimate of sales is the most important number in the budget. This is a result of a complete analysis of the marketing and sales activities (Tracy, 2004). The numbers should be easy to predict, this would include high, medium, and low sales estimates. When launching a new product basing the budget on a percentage of the predicted sales will work well with Nike because the company is very well established. Last year alone Nike spent 240 billion on TV advertising alone, plus all the sports affiliations on star like Colby Bryant and Tiger Woods, plus magazines, newspapers, radio, and the Internet and many more advertising devices (Nike, 2010). This adds up to 800 billion in advertising each year. This energy bar will only be a small part of the advertising bill but will bring much benefit to the company (Nike, 2010).
The new product will have a budget of 25 million dollars that Nike will have as a budget. The media that the company will use is TV adds, magazines, and at sports events. While planning the budget is one of the most important for a new product ensuring that the funds of the budget are being allocated to all the