Analysis and Interim Report

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Analysis and Interim Report

• Valeria Balseca
• Sales Marketing Manager
• Claudia Prada
• MM Manager
• Jhonattan Polo
• CEO

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1. Strategies of Companies
Company DD Company EE Company FF
Price Avg Price Decreasing (constant rate) Avg Price Constant (oscillating variations) Avg Price Decreasing (constant rate)
Margin Increasing (-29 to 21) Decreasing (1 to -4) Increasing (-47 to -3)
Marketing No Marketing Strategy 0 Low Marketing investment 865 High Marketing investment in Q4, but not representative 4170
Inventory Low Inventory Levels (Avg 199,084 un/day) Medium Inv. levels (Avg 205,109 un/day) High Inventory levels (Avg 228,691 un/day)
Production No new product lines 2 New Product lines of 500g (Blueberry Original) 2 New Product lines of 500g (Strawberry Mixed)
Procurement High order quantities (gt200,000KG) High order quantities (gt200,000KG) Low order quantities (gt200,000KG)
Investments None Reduce set up time (200,000 from 12hr to 7.5hr approx.) None
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2. Profit and revenues
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2. Profit and revenues
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3. Investment for reducing setup time
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5. Investment for increasing capacity
No company invested for increasing capacity
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5. Sold quantities and revenue DC 10
Highest Company DD
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5. Sold quantities and revenue DC 12
Highest Company DD
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5. Sold quantities and revenue DC 14
Highest in Units Company EE Highest in Revenue
Company FF
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6. of Sold quantities of new products
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6. of Sold quantities of new products
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7. of revenue from new products
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7. of revenue from new products
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8. of Revenue of each Distribution Channel
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9. Sold quantities and prices of each product
FF-F01 1 Kg Nut Muesli
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9. Sold quantities and prices of each product
FF-F02 1 Kg Blueberry Muesli
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9. Sold quantities and prices of each product
FF-F03 1 Kg Strawberry Muesli
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9. Sold quantities and prices of each product
FF-F04 1 Kg Raisin Muesli
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9. Sold quantities and prices of each product
FF-F05 1 Kg Original Muesli
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9. Sold quantities and prices of each product
FF-F06 1 Kg Mixed Fruit Muesli
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9. Sold quantities and prices of each product
FF-F02 500 Kg Blueberry Muesli
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9. Sold quantities and prices of each product
FF-F03 500 Kg Strawberry Muesli
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9. Sold quantities and prices of each product
FF-F05 500 Kg Original Muesli
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9. Sold quantities and prices of each product
FF-F06 500 Kg Mixed Fruit Muesli
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10. Prices changes of each product
FF-F01 1 Kg Nut Muesli
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10. Prices changes of each product
FF-F02 1 Kg Blueberry Muesli
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10. Prices changes of each product
FF-F03 1 Kg Strawberry Muesli
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10. Prices changes of each product
FF-F04 1 Kg Raisin Muesli
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10. Prices changes of each product
FF-F05 1 Kg Original Muesli
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10. Prices changes of each product
FF-F06 1 Kg Mixed Fruit Muesli
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11. Marketing Expense
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12. Production
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12. Daily Production (continued)
25000 22500 20000 17500 15000 12500 10000 7500 500
0 2500 0
37 64 75 64
25000 22500 20000 17500 15000 12500 10000 7500 500
0 2500 0
48 53 71 16
25000 22500 20000 17500 15000 12500 10000 7500 500
0 2500 0
28 62 45 47
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13. Fixed costs (daily) for company FF
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14. Production Capacity

• Planned production Capacity
• 21,000 units per day
• Average Productivity
• 75
• Production capacity allocation basis
• 15,750 units per day
• Allocated fixed costs per unit
• 1.71

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14. Production Capacity (continued)
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15. Raw Materials Cost

• Average raw material cost per company (from
  operations table)

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15. BOM (end of simulation)
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15. Planned Manufacturing Cost

• Company FF

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15. Planned Manufacturing Costs
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16. Purchase

• Vendors List (Company FF)

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16. Purchase (table ekpo)
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16. Purchase
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17. Inventory Changes
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18. Days out of stock
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19. Days without Production
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20. Production Utilization Rate
100 90 80 70 60 50 40 30 20 10 0
100 90 80 70 60 50 40 30 20 10 0
100 90 80 70 60 50 40 30 20 10 0
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21. Prices and profit correlation.Company FF
Correlations
1) Prices and profit
2) Price and revenue
3) Inventory and profit
4) Inventory and revenue
5) Profit/revenue and marketing expenses
6) Profit/revenue and utilization rate of production
7) Profit/revenue and investment
What factor do you think is more critical?
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21. Prices and profit correlation.Company EE
Correlations
1) Prices and profit
2) Price and revenue
3) Inventory and profit
4) Inventory and revenue
5) Profit/revenue and marketing expenses
6) Profit/revenue and utilization rate of production
7) Profit/revenue and investment
What factor do you think is more critical?
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21. Prices and profit correlation.Company DD
Correlations
1) Prices and profit
2) Price and revenue
3) Inventory and profit
4) Inventory and revenue
5) Profit/revenue and marketing expenses
6) Profit/revenue and utilization rate of production
7) Profit/revenue and investment
What factor do you think is more critical?
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21. Prices and profit correlation.Company DD,
EE, FF
Correlations
1) Prices and profit
2) Price and revenue
3) Inventory and profit
4) Inventory and revenue
5) Profit/revenue and marketing expenses
6) Profit/revenue and utilization rate of production
7) Profit/revenue and investment
What factor do you think is more critical?
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22. Lessons Learned

• Consider not only raw materials cost when making
  decisions about setting up product prices. Take
  into account fixed costs!!!
• Produce in bigger lot sizes, as there are costs
  and times associated to changing products.
• Track of the inventory at all times and dont run
  out of stock. Every day there can be significant
  changes and this could be determinant in the
  winning/loosing of the simulation.
• It takes around 2 days to get raw materials once
  they are ordered
• There is also setup time and production time
• Marketing does not seem to have impact on sales.
  If the company adopted a marketing strategy, it
  is important to determine the representative
  amount of marketing for each area an product to
  get an effect in sales.
• The decision of changing prices should be well
  analyzed, based on the available inventory and
  the sales.
• Prioritize production keeping inventory levels of
  products that have high sales
• In this simulation, sales where not influenced by
  marketing, and it was not very sensitive to price
  changes even though we reduced prices to push
  our sales, our markets did not respond as expected