Develop forecasted Profit and Loss pro-forma statements for Clean Edge under Niche and Mainstream Scenarios for the first two years. Use Exhibit A in the next page as a guide.

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Exhibit 7 Financial Forecasts: Alternative Positioning Scenarios for Clean Edge Niche Positioning Planned capacity Razor unit volume (millions of units) Planned capacity Cartridge unit volume (millions of units) Capacity costs ($ in millions) Razor: Production per unit cost Razor: Manufacturer price Razor: Suggested price Cartridge: Average Production unit cost Cartridge: Average Manufacturer price Cartridge: Average Suggested price Advertising ($ in millions) Consumer promotions ($ in millions) Trade promotions ($ in millions) Cartridge unit assumes average 4-count refill package. Year 1 Year 2 Year 1 Year 2 Year 1 Year 2 Year 1 Year 2 Year 1 Year 2 Year 1 Year 2 $ $ 1.0 1.5 $ $ 4.0 10.0 $ 5.00 $ 9.09 $ 12.99 55 0.61 0.87 $ 2.43 $ 7.35 $10.50 7 7 99 S 2 $ 3 Mainstream Positioning $ 1.71 $ 2.45 $ SS $ 4.74 $ 7.83 $11.19 $ 2.24 $ 6.22 $ 8.89 3.3 4.0 9.9 21.9 $ 55 19 $ 17 17 14 $ 6 $ 89 Exhibit A. Profit and Loss Forecasts for Clean Edge Under Niche and Mainstream Scenarios ($ in Millions) 1 Unit sales - Razors 2 Dollar sales - Razors 3 Unit sales - Cartridges 4 Dollar sales - Cartridges 5 Total dollar sales 6 Production costs Razors 7 Production costs Cartridges 8 Capac ity costs 9 Advertising and Promotion 10 Total costs 11 Operating Profit 12 Profits as % of sales Year 1 Niche Year 2 13 Cost of cannibalization - Razors 14 Cost of cannibalization - Cartridges 15 Profit after cannibalization (a) Cannibalization cost=% cannibalization from Avail and Pro* unit sales contribution per unit Year 1 Mainstream Year 2 Exhibit 7 Financial Forecasts: Alternative Positioning Scenarios for Clean Edge Niche Positioning Planned capacity Razor unit volume (millions of units) Planned capacity Cartridge unit volume (millions of units) Capacity costs ($ in millions) Razor: Production per unit cost Razor: Manufacturer price Razor: Suggested price Cartridge: Average Production unit cost Cartridge: Average Manufacturer price Cartridge: Average Suggested price Advertising ($ in millions) Consumer promotions ($ in millions) Trade promotions ($ in millions) Cartridge unit assumes average 4-count refill package. Year 1 Year 2 Year 1 Year 2 Year 1 Year 2 Year 1 Year 2 Year 1 Year 2 Year 1 Year 2 $ $ 1.0 1.5 $ $ 4.0 10.0 $ 5.00 $ 9.09 $ 12.99 55 0.61 0.87 $ 2.43 $ 7.35 $10.50 7 7 99 S 2 $ 3 Mainstream Positioning $ 1.71 $ 2.45 $ SS $ 4.74 $ 7.83 $11.19 $ 2.24 $ 6.22 $ 8.89 3.3 4.0 9.9 21.9 $ 55 19 $ 17 17 14 $ 6 $ 89 Exhibit A. Profit and Loss Forecasts for Clean Edge Under Niche and Mainstream Scenarios ($ in Millions) 1 Unit sales - Razors 2 Dollar sales - Razors 3 Unit sales - Cartridges 4 Dollar sales - Cartridges 5 Total dollar sales 6 Production costs Razors 7 Production costs Cartridges 8 Capac ity costs 9 Advertising and Promotion 10 Total costs 11 Operating Profit 12 Profits as % of sales Year 1 Niche Year 2 13 Cost of cannibalization - Razors 14 Cost of cannibalization - Cartridges 15 Profit after cannibalization (a) Cannibalization cost=% cannibalization from Avail and Pro* unit sales contribution per unit Year 1 Mainstream Year 2

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In USD millions Niche Mainstream Particulars year 1 year 2 year 1 year 2 1 Unit sal... View the full answer