You identified a new potential product beauty widgets. There are two similar products already selling on
Question:
a. Should the company pursue this opportunity?
b. If yes, what is the expected profit margin?
c. At what price would you sell the product and why?
d. How many units do you expect to sell at that price and why?
e. Assuming the company, starts selling the product and everything goes as planned with the first order. The company normally has a policy to hold 14 days of inventory. How much working capital will the company need for this product?
f. The beauty widget is relatively big and heavy, so your team suggests to ship part of the first order by sea. Sea shipments cost the company US$ 3 per kg. Please insert a calculation into the excel file where can you can adjust x% of the order to be shipped by sea and (1-x)% to be shipped by air. What % do you think the company should ship by sea and why?