Questions: CASE STUDY ASSIGNMENT #4 - QUANTITATIVE ANALYSIS AND DECISION MAKING CASE

Washburn International Guitars. Marketing Quantitative Analysis and Decision Making.

(Case Note: Reliable References are REQUIRED to adequately address the questions in this case.)

1. What factors are most likely to affect demand for the lines of Washburn guitars

(a) bought by first-time guitar buyers and

(b) by a sophisticated musician who wants a signature model?

2. For Washburn, what are some factors that may cause the demand curve for the new guitar line to shift (movement of the demand curve)?

3. In Washburn's Chicago plant, what is the break-even point in units and Sales (BEP) for the new line of guitars if the suggested retail price is

(a) $850,

(b) $900,

(c) $1000

Show your work. Hint: Calculate Washburn's selling price to retailers first.

4. If Washburn achieves the sales target of 25,000 units at $850 suggested retail price, what will its profit be?

Show your work. Hint: Calculate Washburn's selling price to retailers first. (Profit = Total Revenue - Total Costs)

5. Assume that Washburn moves its production to Nashville and that the costs are reduced as projected in the case. Given a $850 suggested retail price, what will be the new

(a) BEP in units

(b) BEP in Dollars

6. Assume that Washburn negotiates a new retail markup of 35%, with a suggested retail selling price of $850, (10 points possible)

(a) what is Washburn's new selling price per guitar to retailers

(b) what is Washburn's new BEP in units, and

(c) what is Washburn's new BEP in dollars?

7. If for competitive reasons, Washburn eventually has to move all its production to China,

(a) which specific costs might be lowered and

(b) what additional costs might it expect to incur? To answer this question, visit the following website: globaledge and Click on Country Insights and find China.

8. With all of the options given in this case, answer the following questions in an executive summary format. Do show your supporting research data and provide a references page. (45 points possible)

• What environmental factors might be of most interest to Washburn and why?

• Which manufacturing facility would you recommend and why?

• Which retail pricing strategy would you choose and why? In addition, which U.S. manufacturing facility would you choose?

• What is the most likely target market for the new guitar line? Do explain this market in detail using

- Demographics

- Geographics

- Psychographics

- Buyer Behaviors

• What is your recommendation for moving forward? How and Why?

Information related to above question is enclosed below:

Attachment:- Case4WashburnMathCaseMKTG1110.rar