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The purpose of this paper is to create a business proposal that provides recommendations to increase revenue, achieve ideal production levels, adjust fixed and variable costs to maximize profit and identify methods to reduce costs. Additionally, the paper describes processes used to make the recommendations and provide assumptions regarding the organization and its values. Using charts and graphs, the writer presents a detailed argument using the study of a cell phone manufacturer, Clear Hear.
From the Paper:"Clear Hear is a cell phone manufacturer currently assessing the feasibility of accepting a promotional order from Big Box, a major discount chain retailer. According to the Clear Hear scenario (University of Phoenix, 2009) Kendra Sherman is a business development specialist who has secured a large order for cell phones. Kendra met with the production manager, Lisa Norman to discussed the details of the order and determine the feasibility of producing the cell phones at Clear Hear. The following is a business proposal supporting the receipt and production of the cell phone order from big Box.
"Clear Hear has received an order for 100,000 cell phones that are modeled after Clear Hear's Alpha model. The order is from Big Box who is currently running a marketing promotion with a telephone provider. The expected delivery date is 90 days from acceptance of the order. Clear Hear runs two production lines and currently has an excess capacity of 70,000 cell phone units projected over the next three months. The first production line is for the Alpha model, the second line produces the higher end Beta model, which has more features. Big Box, is proposing to pay $15 for each manufactured cell phone, based on the $20 per unit Alpha model. The Beta model sells for $30 each but carries higher fixed and variable costs associated to production. Opportunity is available to outsource up to 100,000 units of the Alpha model to an Original Equipment Manufacturer (OEM) that has met Clear Hear's quality and manufacturing standards offering a nonnegotiable price of $14 per unit (University of Phoenix, 2009). Below is the base comparison for production costs and expected profit."
Sample of Sources Used:
- Investopedia. (2009). In-house. Retrieved November 26, 2009, from http://www.investopedia.com/terms/i/in-house.asp
- (Investopedia 2009 Opportunity cost)Investopedia. (2009). Opportunity cost. Retrieved November 27, 2009, from http://www.investopedia.com/terms/o/opportunitycost.asp
- (Investopedia 2009 Outsourcing)Investopedia. (2009). Outsourcing. Retrieved November 27, 2009, from http://www.investopedia.com/terms/o/outsourcing.asp
- (University Of Phoenix 2009 Clear Hear Scenario)University Of Phoenix. (2009). Week three supplement: Clear Hear scenario. Retrieved 11/25/2009 from University of Phoenix, ECO/561 course website.
- Richardson (2008) (Richardson T 2008 Why domestic outsourcing is a better choice)Richardson, T. (2008). Why domestic outsourcing is a better choice. Retrieved November 29, 2009, from http://ezinearticles.com/?Why- Domestic- Outsourcing- is- the- Better- Choice&id=1526711
Cite this Business Plan:
Revenue, Cost Concepts and Market Structure Proposal (2012, March 18) Retrieved May 22, 2013, from http://www.academon.com/business-plan/revenue-cost-concepts-and-market-structure-proposal-150583/
"Revenue, Cost Concepts and Market Structure Proposal" 18 March 2012. Web. 22 May. 2013. <http://www.academon.com/business-plan/revenue-cost-concepts-and-market-structure-proposal-150583/>