http:www.millenniumchem.com

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Sable Holt
Marcellino Manilla
Jessica Landis
Brian Sweeney
Jeff Lofton
http//www.millenniumchem.com
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Table of Contents
Brian Global Capacity Setting the Price
Monopolistic Competition and Oligopoly
Jessica Opportunity Cost Labor Market Pr
oduction and Cost Conclusion
Jeff Company Information Marcellino Locatio
ns Product, Uses, and Competitors Resources
Land Sable Resources Labor Resources Capi
tal Capital and Financial Markets
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Company Information

• Millennium Chemicals is the 2nd largest producer
  of titanium dioxide (TiO2) in the world.

• Corporate headquarters is located in Red Bank,
  New Jersey.

• Millennium Chemicals was a spin-off of the
  Hanson Corporation in the late 1990s.

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Locations of Chemical Plants
7 - United States
2 - Brazil
2 - France
1 - United Kingdom
3 - Australia
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Product
TITANIUM DIOXIDE (TiO2)
(pigment)
Uses
Paint Coating (liquid), Plastics (dry), Paper
(dry)

Competitors

• Dupont (largest worldwide competitor)

• Kerr-McGee

• Huntsman-Kronos

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Resources
Land the physical space on which production
occurs, and the natural resources that come with
it.

• Each chemical plant consists of approximately 20
  to 30 acres of land.

• Several of the plants are located near major
  waterways (ex. The Great Lakes The Chesapeake
  Bay)

• Raw materials are shipped by boat.

• Finished products are shipped by ocean liners,
  trucks, railcars

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Resources
Labor the time human beings spend producing goods
and services.
3 Types of Workers
Worldwide Millennium Chemicals employs more than
4,000 people
1. Hourly Workers

• Union Members

• Operators

• Mechanics

2. Managers

• Non-Union

• Oversee Plant

3. Support Staff

• Non-Union

• Accountants

• Human Resources

• Purchasing

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Resources
Capital long-lasting tools used in producing
goods and services.

• Raw Material Spare Parts Inventory

• Finished Product Inventory

• Plant Equipment

Market Capital
739.8 million
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Capital Financial Markets
Stock

• Present Value Per Share

• 11.65

• Total Shares

• 63.5 million

Exchange New York Stock Exchange
Listed Security MCH Common Stock
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• Price of Titanium Dioxide per metric ton
  delivered

• 2,200 2,300

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Monopolistic Competition Oligopoly

• When setting the price of titanium dioxide,
  Millennium Chemicals follows the rates of the
  other producers, specifically Dupont (leading
  national seller)

• Millennium will set their price higher than the
  other producers, but if no other companies
  (especially Dupont) raise their prices, then
  Millennium will immediately drop their prices to
  a more competitive price.

• The producers of Titanium Dioxide are NOT ALLOWED
  to work together when setting prices. (Tacit
  Collusion Any form of oligopolistic cooperation
  that does not involve any explicit agreement)

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Setting the Price

• Perfect Price Discrimination

Charging each customer the most he or she would
be willing to pay for each unit purchased.

• Typically smaller consumers pay more

• Larger firms typically receive a cheaper rate
  for purchasing large quantities of Titanium
  Dioxide

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Production Cost
Variable Cost - 850
Controllable Costs - 350
Fixed Costs - 200

Manufacturing Total - 1,400 per mt
Marketing/Sales - 200
Distribution - 200
Total Costs - 1,800 per mt
Profit per mt - 400
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Labor Market

• Union Members are on a contract

• Operators/mechanics

• 20.00 an hour (typical rate)

(United States Steel Workers Union)

• Manager Salary is 85,000

• Engineers Salary- 70,000

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Opportunity Cost
What is given up when making a choice or taking
action
Decisions

• Purchasing new machinery

• Upgrading equipment

• Raising employees salaries

• Product development

Solution

• Economic Value Added

• The company compares the different alternative
  costs and benefits that each decision (listed
  above) will provide

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Conclusion
In conclusion, Millennium Chemicals is in an
Oligopolistic market. For being a rather young
company, Millennium Chemicals has already made a
significant impact in the World Market for
titanium dioxide. Resources, production, and
opportunity cost all play roles in the decisions
made by Millennium Chemicals.