Mikes Bikes Report

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|AFM 131 Report |December 3 | | |2011 | |This is a report of the company named JayHsquared which contains decisions made |JayHsquared | |and the results from these decisions from 2003 to 2011. Written by the president| | |of the firm to the Directors of Mike’s Bikes. | |

To the Directors of Mike’s Bikes,

JayHsquared is a corporation that was founded in September of 2003, located in Waterloo, Ontario, Canada.  The company is the proud producer of mountain and youth bikes.  The mission of the firm is to gain loyal customers by being the lead providers of medium quality bikes at moderate prices.  Every year, the decisions made by the management of the firm lead to an increase in the company’s shareholder’s value. This value started at $8.96 in 2004 and it increased to $37.03 by 2011. The cumulative change in SHV was 313%. Our advertising for year 2004 was $1,200,000 and by year 2011 it was $4,400,000. The increases in advertising expenditure also lead to an increase of the firm’s awareness. Our mountain bikes started with an awareness of 0.26 and ended with 0.33. In year 2007, the firm had the choice to launch a new line of youth or road bikes. JayHsquared launched youth bikes as the management believed that there would be a larger market for youth bikes than road bikes. After this opportunity, the firm had the choice to introduce all three lines of bikes; our firm choose to continue focusing only on mountain and youth bikes. Our entire competition introduced all three lines of bikes, however our management believed that it would be a wise strategy to place all focus on only the mountain and youth bike industry. Our strategy was effective as we ranked second place in our local industry. In year four we also had the option to give out dividends to our shareholders. JayHsquared was the only company that decided to give out $2 dividends per share in order to attract new investors and increase the shareholder’s value. Several challenges JayHsqaured faced were maximizing capacity and keeping a competitive edge over the other bike companies in the industry. The management plans to maintain a continual increase in SHV each year and to keep learning from all of the mistakes that our company makes, and also from the mistakes of our competition. In the future, our firm intends to keep errors at a minimum and to go forward keeping in close competition with other bike industries. Most importantly, our firm will continue to strive to achieve our mission to be the lead producers if medium quality bikes.

Affirmation Statement
AFM World 4 – Team 16: JayHsquared

Name: Hector Abullarade GamezID Number: 20276380
Name: Janice KwanID Number: 20264853
Name: Heather HollandID Number: 20265899
Name: Janice LawID Number: 20261726

TA: Sharon Mendonca
Date: December 3rd, 2007

Rollover 1: Year 2004

Introduction

As this was the first year of production for our corporation, our company's shareholder's value was consistent with all of the competitors in the bike industry with an amount of $8.96 (Appendix 1A).  In order to get the company started productively we aimed to make our product marketing, including brand awareness, public relations, distribution, and advertising at moderate values.

This year’s decisions
Marketing Decisions

We focused our decisions mainly on marketing during this year. Our company decided to increase advertising in order to increase brand awareness and decrease public relations expenditures....
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