Clear company manufactures vacuum cleaners. Specializing in the market niche of entry-level vacuum cleaners, it is...

 

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Clear company manufactures vacuum cleaners. Specializing in the market niche of "entry-level" vacuum cleaners, it is studying the launch of a more efficient model (referenced T1200) Activity forecasts are 15,000 units per month in the launch phase. The company hopes to reach a pace of 25,000 units at maturity of 6 months. It wishes, within the framework of the design study, to define production conditions on the basis of the objective cost. The product would be marketed through the network of specialist splitters and by mass distribution. The public sale prices inclusive of VAT (20% VAT) in both networks are € 384 and € 252. Distributors have a margin on this product equal to 40% of the sales price exclusive of taxes for the specialist trade and 25% of the retail price excluding taxes. Clear has defined a margin rate in proportion to wholesale distributor prices; It corresponds to the share of the total expected profit attributed to this product and to the cover of production costs. The desire to access this large-scale retail market led the company to retain a margin on sales price of 25% for sales to purchasing centers compared to 30% for sales to traditional commerce. The technical product will be identical for the two modes of distribution, excluding the hull. A "standard" hull is provided for the "large distribution network, while a "design" hull will be retained for specialized dealers. The estimated cost, based on technical choices, should be as close as possible to the objective cost. The production conditions are set out in Annex 1 A market study was carried out among 500 potential consumers; It showed the value accorded to the main functions assigned to a vacuum cleaner (Annex 2) Work to do: 1°) Calculate the objective cost from the public selling prices in each network. Is there a common objective cost? 2") Calculate the estimated cost assuming that the company retains the best performing solution for each component. Compare the target cost and the estimated cost. Comment on your results. 3°) Exploit this estimated cost between the functions assumed by the product, in order to calculate the percentage of total cost devoted to the satisfaction of each of these functions Assignment 4°) Estimated Cost Adjustment: What changes in the technical solution in Question 3 do you recommend? What other measures need to be taken? 5°) Write a research paper on "value analysis" and "kaysen" (3 to 4 pages). Annex 1 - Conditions of production A vacuum cleaner is built on a chassis mounted on a roller. It supports the suction turbine and is covered by a hull containing the bag receiving the aspirated materials. The top of the hull has a space for storing accessories (various brushes or scrapers). Choosing the hull is an important part of the marketing mix, as it conditions the aesthetics of the vacuum cleaner. A tube, consisting of a flexible part and a rigid part, is connected to the trunk and supports the suction accessories. A power supply device supplies power to the turbine. Filters and various supplies are incorporated into the product. ➤ Suction Turbine Four turbine types were selected; They are distinguished from each other by their power and sound level. Power conditions suction performance sound level ➤ Chassis 60 decibels 50 decibels 1 000 W Case study Clear Company Managing the cost of creation value € 23.50 2/4 € 25.00 Power 1 200 W ✓ Power supply Three systems are proposed: - simple system with retractor allowing to develop 3.50 meters of wire, cost: € 7 - same system but allowing to develop 6 meters of wire, cost € 9 - system allowing to develop 6 meters of wire with variator of power cost: € 13 - The basic electrical system is considered to be linked to the suction function (power supply of the turbine). Also, the inverter improves suction performance. The length of unwound yarn is an element of ease of use. € 26.00 € 27.50 Three types of chassis are compatible with the proposed turbine and hull models: - basic model, weight 1.7 kg, cost € 18.50 - model in composite material, weight 1.2 kg, cost € 23.50 - same model as above but equipped with casters of better quality: € 24.50. The chassis ensures mobility; The gain of weight obtained is to be attached to the function Comfort (storage of the device facilitated by a gain of weight). Bemard Auge Assignment ➤ Hull The supplier offers two hull models: the "standard" model and the "design" model respectively used for products distributed in supermarkets and specialized stores, in order to differentiate the commercial image of the products. The respective costs are € 11.50 and € 16. These hulls have a storage space for 4 accessories. Clear has requested a price proposal for a hull that can hold 8 accessories; The additional cost would be € 5 per unit (need to manufacture a new mold) ➤ Tubes and accessories The differences in the proposed solutions are: - to the suction tube, the rigid part of which may be telescopic; - the number of accessories (4 or 8). Non-telescopic duct Telescopic duct 4 accessories Managing the cost of creation value € 27.00 Case study Clear Company € 30.50 3/4 8 accessories € 35.00 The basic technical solution is attached to the suction function (not in the absence of the tube and the basic accessories). The adoption of a telescopic duct is an element of comfort whereas the multiplication of the number of accessories allows the adaptability of the aspirator (more possible uses) ➤ Filters and accessories € 38.50 Dust filters, cost: € 3.50; They contribute to the suction function by avoiding the fouling of the turbine.Sound insulation, cost € 4.50 or € 8 depending on the quality of the insulation. Miscellaneous supplies, cost: € 4.50; The cost of such supplies shall be assimilated to the cost of assembly for the analysis of the value. ➤ Activity of assembly ✓ Automated solution The assembly line would allow the manufacture of 25,000 units per month. The monthly cost of this channel would be € 187,500. Qualified personnel would monitor the passage of vacuum cleaners on the chain; Its estimated hourly cost is € 30 and the labor time per assembled unit would be 4 minutes. ✓ Manual solution In this solution, the assembly costs would be distributed according to the hours of labor; Hourly costs would be € 20 for labor and € 50 for workshop costs. The planned intervention time is 12 minutes per assembled unit (labor and workshop). Assembly costs can not be allocated to a specific use function of the property. They are identical regardless of the nomenclature chosen. Bemard Auge Assignment Annex 2 : Consumer Survey In this survey respondents were asked to rate the expected qualities of a vacuum cleaner from 1 to 3. The answers obtained are reproduced in the table below and expressed in percentages: In this survey respondents were asked to rate the expected qualities of a vacuum cleaner from 1 to 3. The answers obtained are reproduced in the table below and expressed in percentages: Functions Suction Mobility Comfort in power use Cited in n ° 1 12 Cited in n° 2 12 Cited in n 3 13 Reading table: Suction quality is cited as: Quality 1 by 47% of respondents Quality 2 by 28% of respondents Quality 3 by 20% of respondents 47 28 20 9 10 15 MO Case study Clear Company Managing the cost of creation value 4/4 Sound Aesthetic Adaptation level to many uses 9 20 27 13 20 7 The person in charge of the market research proposes to determine the expected value of each function by weighting the answers obtained according to the rank at which the quality quoted is located: rank 1 → weighting of 3; Rank 2 → weight of 2; Rank 3 → weighting of 1. 10 10 Bemard Auge Clear company manufactures vacuum cleaners. Specializing in the market niche of "entry-level" vacuum cleaners, it is studying the launch of a more efficient model (referenced T1200) Activity forecasts are 15,000 units per month in the launch phase. The company hopes to reach a pace of 25,000 units at maturity of 6 months. It wishes, within the framework of the design study, to define production conditions on the basis of the objective cost. The product would be marketed through the network of specialist splitters and by mass distribution. The public sale prices inclusive of VAT (20% VAT) in both networks are € 384 and € 252. Distributors have a margin on this product equal to 40% of the sales price exclusive of taxes for the specialist trade and 25% of the retail price excluding taxes. Clear has defined a margin rate in proportion to wholesale distributor prices; It corresponds to the share of the total expected profit attributed to this product and to the cover of production costs. The desire to access this large-scale retail market led the company to retain a margin on sales price of 25% for sales to purchasing centers compared to 30% for sales to traditional commerce. The technical product will be identical for the two modes of distribution, excluding the hull. A "standard" hull is provided for the "large distribution network, while a "design" hull will be retained for specialized dealers. The estimated cost, based on technical choices, should be as close as possible to the objective cost. The production conditions are set out in Annex 1 A market study was carried out among 500 potential consumers; It showed the value accorded to the main functions assigned to a vacuum cleaner (Annex 2) Work to do: 1°) Calculate the objective cost from the public selling prices in each network. Is there a common objective cost? 2") Calculate the estimated cost assuming that the company retains the best performing solution for each component. Compare the target cost and the estimated cost. Comment on your results. 3°) Exploit this estimated cost between the functions assumed by the product, in order to calculate the percentage of total cost devoted to the satisfaction of each of these functions Assignment 4°) Estimated Cost Adjustment: What changes in the technical solution in Question 3 do you recommend? What other measures need to be taken? 5°) Write a research paper on "value analysis" and "kaysen" (3 to 4 pages). Annex 1 - Conditions of production A vacuum cleaner is built on a chassis mounted on a roller. It supports the suction turbine and is covered by a hull containing the bag receiving the aspirated materials. The top of the hull has a space for storing accessories (various brushes or scrapers). Choosing the hull is an important part of the marketing mix, as it conditions the aesthetics of the vacuum cleaner. A tube, consisting of a flexible part and a rigid part, is connected to the trunk and supports the suction accessories. A power supply device supplies power to the turbine. Filters and various supplies are incorporated into the product. ➤ Suction Turbine Four turbine types were selected; They are distinguished from each other by their power and sound level. Power conditions suction performance sound level ➤ Chassis 60 decibels 50 decibels 1 000 W Case study Clear Company Managing the cost of creation value € 23.50 2/4 € 25.00 Power 1 200 W ✓ Power supply Three systems are proposed: - simple system with retractor allowing to develop 3.50 meters of wire, cost: € 7 - same system but allowing to develop 6 meters of wire, cost € 9 - system allowing to develop 6 meters of wire with variator of power cost: € 13 - The basic electrical system is considered to be linked to the suction function (power supply of the turbine). Also, the inverter improves suction performance. The length of unwound yarn is an element of ease of use. € 26.00 € 27.50 Three types of chassis are compatible with the proposed turbine and hull models: - basic model, weight 1.7 kg, cost € 18.50 - model in composite material, weight 1.2 kg, cost € 23.50 - same model as above but equipped with casters of better quality: € 24.50. The chassis ensures mobility; The gain of weight obtained is to be attached to the function Comfort (storage of the device facilitated by a gain of weight). Bemard Auge Assignment ➤ Hull The supplier offers two hull models: the "standard" model and the "design" model respectively used for products distributed in supermarkets and specialized stores, in order to differentiate the commercial image of the products. The respective costs are € 11.50 and € 16. These hulls have a storage space for 4 accessories. Clear has requested a price proposal for a hull that can hold 8 accessories; The additional cost would be € 5 per unit (need to manufacture a new mold) ➤ Tubes and accessories The differences in the proposed solutions are: - to the suction tube, the rigid part of which may be telescopic; - the number of accessories (4 or 8). Non-telescopic duct Telescopic duct 4 accessories Managing the cost of creation value € 27.00 Case study Clear Company € 30.50 3/4 8 accessories € 35.00 The basic technical solution is attached to the suction function (not in the absence of the tube and the basic accessories). The adoption of a telescopic duct is an element of comfort whereas the multiplication of the number of accessories allows the adaptability of the aspirator (more possible uses) ➤ Filters and accessories € 38.50 Dust filters, cost: € 3.50; They contribute to the suction function by avoiding the fouling of the turbine.Sound insulation, cost € 4.50 or € 8 depending on the quality of the insulation. Miscellaneous supplies, cost: € 4.50; The cost of such supplies shall be assimilated to the cost of assembly for the analysis of the value. ➤ Activity of assembly ✓ Automated solution The assembly line would allow the manufacture of 25,000 units per month. The monthly cost of this channel would be € 187,500. Qualified personnel would monitor the passage of vacuum cleaners on the chain; Its estimated hourly cost is € 30 and the labor time per assembled unit would be 4 minutes. ✓ Manual solution In this solution, the assembly costs would be distributed according to the hours of labor; Hourly costs would be € 20 for labor and € 50 for workshop costs. The planned intervention time is 12 minutes per assembled unit (labor and workshop). Assembly costs can not be allocated to a specific use function of the property. They are identical regardless of the nomenclature chosen. Bemard Auge Assignment Annex 2 : Consumer Survey In this survey respondents were asked to rate the expected qualities of a vacuum cleaner from 1 to 3. The answers obtained are reproduced in the table below and expressed in percentages: In this survey respondents were asked to rate the expected qualities of a vacuum cleaner from 1 to 3. The answers obtained are reproduced in the table below and expressed in percentages: Functions Suction Mobility Comfort in power use Cited in n ° 1 12 Cited in n° 2 12 Cited in n 3 13 Reading table: Suction quality is cited as: Quality 1 by 47% of respondents Quality 2 by 28% of respondents Quality 3 by 20% of respondents 47 28 20 9 10 15 MO Case study Clear Company Managing the cost of creation value 4/4 Sound Aesthetic Adaptation level to many uses 9 20 27 13 20 7 The person in charge of the market research proposes to determine the expected value of each function by weighting the answers obtained according to the rank at which the quality quoted is located: rank 1 → weighting of 3; Rank 2 → weight of 2; Rank 3 → weighting of 1. 10 10 Bemard Auge