Card Set Information
If product in emerging growth stage ...
... focus on R&D, competition, and pricing
If product in growth stage ...
... focus on marketing and competition
If product in mature stage ...
... focus on manufacturing, costs, and competition
If product in declining stage ...
... define niche strategy, analyze competition, and/or think exit strategy
If you lower prices and volume rises and you are pushed beyond full capacity then ...
... costs will rise (i.e. labor) and profits will decline
If sales and market share are increasing but profits are declining then ...
... look into prices and costs
If sales and market share are flat then it could mean ...
... industry sales are flat (and competitors having same experience)
Elements of COGS
Direct labor, direct material costs, overhead, delivery costs
Gross margin less x and y = Operating margin
Examples of fixed costs
Fixed costs don't change month to month: rent, insurance premium, loan payment, equipment lease, admin./tech. support
Examples of variable costs
Variable costs do change month to month and depend on volume: raw materials, hourly labor, incremental power/fuel, office supplies