Dirt Bikes Usa

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Dirt Bikes USA
Running Case Study
Samantha Vinciguerra Geric Brodt Jeff Fedyk Phil Cyr

Table of Contents
Management Analysis of a Business……………………………………………………...3 Analyzing Financial Performance………………………………………………………...4 Performing a Competitive Analysis………………………………………………………6 Analyzing the Total Cost of Ownership (TCO) of Desktop Software Assets……………8 Redesigning the Customer Database……………………………………………………..8 Using Internet Tools to Increase Efficiency and Productivity…………………………..10

Table of Charts
Table 1: Dirt Bikes USA Sales History from 2001 to 2005................................................4 Table 2: Domestic vs. International Sales from 2001 to 2005……………………………5 Table 3: Statement of Income……………………………………………………………..5 Table 4: Software Suites…………………………………………………………………..8 Table 5: Customer Database……………………………………………………………....9 Table 6: Internet Tools Matrix……………………………………………………….......10

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Management Analysis of a Business

Dirt Bikes USA was founded in the early 90’s around the expanding dirt bike culture. The founders, Carl Schimdt and Steve McFadden, started to design dirt bike frames for off road purposes using engines from foreign companies. The goal of Dirt Bikes USA was to create dirt bikes that would rival the foreign brands competing in the US. Steve and Carl felt they had an advantage due to the close proximity of the dirt bike culture in the US. Dirt Bikes USA currently has 4 types of dirt bikes including: the Enduro 250, the Enduro 550, the Moto 300 and the Moto 450. Dirt Bikes USA appeals to mainly Enduro rides and serious trailer riders, however they are expanding into the motocross market. Dirt Bikes USA also has a service department to deal with service warranties and customer problems with parts. Dirt Bikes USA does not sell directly to customers but rather uses a network of 40 distributors, based mainly out of the Western and Midwestern area of the US. There are a small percent of sales out of Europe as well; however these are done through independent retailers. Spare parts and service warranties can only be purchased through an authorized dealer, with some exceptions to those who do not live within 50 miles of an authorized dealer. Dirt Bikes USA has expanded greatly since the early 90’s and now consists of around 120 employees. The company is still privately owned with Carl serving as CEO and Steve serving as President and COO. There is also a marketing manager who over sees five sales representatives. There are 120 employees involved in the design, engineering

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and production aspects, including three full-time designers, 3 full time engineers, four full time parts specialists, and a 10 employee service department. One of the most important information systems of Dirt Bikes would be spreadsheets. These could be used for profit and loss, as well as inventory. Databases would also be important for Dirt Bikes when it comes to keeping track of distributors and customer warranties. Analyzing Financial Performance

Sales History 2001-2005 12000

Amount (in thousand dollars)

10000

8000

6000

4000

2000

0 2001 2002 2003 Years 2004 2005

Table 1: Dirt Bikes USA Sales History from 2001 to 2005

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Domestic vs. International Sales 2001-2005
10000 9000

Amount (in thousand dollars)

8000 7000 6000 5000 4000 3000 2000 1000 0 2001 2002 2003 Years 2004 2005 Domestic International

Table 2: Domestic vs. International Sales from 2001 to 2005

Consolidated Statements of Income (in thousands) 2003 2004 2005 Revenue Net sales Cost of goods sold Gross profit/(loss) Gross margin Operating expenses Sales and marketing Engineering and product development General and administrative Total operating expenses Operating income/loss Other income/expense Interest income/expense Other income/(expense) Income before provision for income taxes Income taxes Net income/(loss) Net margin 61,529 41,072 20,457 33.2% 64,063 43,155 20,908 32.6% 60,144 45,835 14,309 23.8%...
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