Decision

ABC is our family owned business established in 2009 which manufactures supererogatory kids shoes. Due to mass availability of inexpensive shoes in the market ABC has found that it must make about changes in the organization or product to keep the achievement cost as minimum as possible. ABC deep hired a consultant for advice to help it decide whether it should keep out down or if it has enough work to continue operations.   The adjacent is the information provided by a accompany. The company has a jibe of 100 employees who work in companys finance, manufacturing and trade field of operations. It produces 6,000 shoes per calendar month. The employees work 20 days a month at a daily wage of $70/employee. distributively shoes cost $32. The cost of variable inputs that go in the shoes manufacturing is about $2000 a day. ABC told the consultant that the companys fixed cost is high enough so that the companys tot up cost exceed its total revenue and the marginal cost of last unit is $30.

The pastime factors leave have a impact on the product and managements decision to continue or damp operations.

1. Social factor- How many house hold in the area has kids. Are customers willing to purchase cheap import products which has a below standard whole step or want to tolerate little more money and buy good quality shoes which also provides comfortable walking?





2. Substitutes The more the function of sellers in the market for quality shoes, the fierce the competition will be. The better the technology the competitors use, ABC needs to follow rear machinery to produce unique shoes which appeal to both the children and parents.

3. economic factor Since the inputs used in the shoes are imported from other countries, the state of national and international economy, the exchange order affects the cost of variable inputs in manufacturing shoes.

4. Demand for the companys shoes which lead to greater productivity. If there is a high demand for the shoes in the market, then it will...If you want to pee a full essay, order it on our website: Orderessay



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