Business Capstone Project
BUS4993 – Section 04
January 20, 2013
Team D Year Six Summary
Product Design and Marketing Decisions
Our view of the anticipated results is that we will increase in earnings per share if we continue to stay on top of the product design and prices of both cameras. By reducing the price of the Entry-Level camera and adding more features to the Multi-Feature camera, this will enable us to increase in sales. Customers will be looking for cheaper entry-level cameras and high quality Multi-Featured cameras. Entry-level cameras: We have chosen to decrease the size and functions of the entry-level cameras. These cameras are very small and customers are focusing on price here. The features and components have been decreased to fit a more suitable, cheaper price for this camera. The camera has been reduced to $165 in all market areas except for Latin America. The cost in Latin America market will be $170 since this is our biggest market. Reducing the cost of these cameras and features gives us a 10% increase in earnings per share. We will leave the warranty periods the same for both cameras so that we don’t have to allocate more of our budget to into uncertain factors. Multi-featured cameras: The Multi-Featured cameras are our most profitable item. Although it will cost us more to produce these cameras, we expect a positive return on our investment. We now have 8 features which makes the camera more profitable. We have also increased the price in all market areas due to additions to the features. We expect a slight increase in production cost, however; our earnings per share will increase significantly. Here again we keep the warranty period low so that we don’t have to allocate fund for uncertainty. We now have earnings per share of $2.23. Compensation Labor and Assembly
During the first and second quarter production is increased to maximize the allotted 10% inventory gain. The extra inventory...