Muenenster Pup Essay
CASE ANALYSIS: MUENSTER PUMP
I. Major Facts
* Muenster Pump is family owned and operated. * Muenster makes its own cast pump housings at a higher cost than what is currently available in the market place. * Uncle Ned (management) considers the cast pump housings of a quality not equaled in the industry. * Uncle Ned (management) is opposed to outsourcing as it would cause several employees to lose their jobs. * Uncle Ned (management) believes Muenster’s response time is unmatched in their industry.
II. Major Problem
Muenster Pump currently manufacturer’s a case pump housing at a cost twice that of their competition. The company must decide whether or not to continue to manufacture in-house, or to outsource and buy the product from another company. Considerations such as quality, delivery, customer relations, cost, and volume of orders must be taken into account.
III. Possible Solutions/Alternatives
A. Solution/Alternatives
* As a proponent for keeping a stable workforce, Muenster needs to look at increasing production and sales to deal with the fixed cost applied to the cost of the pump. Fixed cost does not flux with sales, however, if you have $100 dollars in fixed cost, and 1 case housing …show more content…
In the event they are unable to generate more revenue, then employees from the top down should consider a cut in pay or benefits in order to buy management some time to create a new strategy and direction for the company. The case housing pumps must be able to be marketed as a product above the competitor’s product. For example, there is a large market for Mac computers. A person can buy a PC for $200 dollars but will buy a Mac for $2000 in the name of quality. If indeed the Muenster pump case housing is a higher quality then the price may fit, but the product must withstand
I. Major Facts
* Muenster Pump is family owned and operated. * Muenster makes its own cast pump housings at a higher cost than what is currently available in the market place. * Uncle Ned (management) considers the cast pump housings of a quality not equaled in the industry. * Uncle Ned (management) is opposed to outsourcing as it would cause several employees to lose their jobs. * Uncle Ned (management) believes Muenster’s response time is unmatched in their industry.
II. Major Problem
Muenster Pump currently manufacturer’s a case pump housing at a cost twice that of their competition. The company must decide whether or not to continue to manufacture in-house, or to outsource and buy the product from another company. Considerations such as quality, delivery, customer relations, cost, and volume of orders must be taken into account.
III. Possible Solutions/Alternatives
A. Solution/Alternatives
* As a proponent for keeping a stable workforce, Muenster needs to look at increasing production and sales to deal with the fixed cost applied to the cost of the pump. Fixed cost does not flux with sales, however, if you have $100 dollars in fixed cost, and 1 case housing …show more content…
In the event they are unable to generate more revenue, then employees from the top down should consider a cut in pay or benefits in order to buy management some time to create a new strategy and direction for the company. The case housing pumps must be able to be marketed as a product above the competitor’s product. For example, there is a large market for Mac computers. A person can buy a PC for $200 dollars but will buy a Mac for $2000 in the name of quality. If indeed the Muenster pump case housing is a higher quality then the price may fit, but the product must withstand