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Drakensberg Limited Case Report. The main problems are whether to launch a new product and how to treat the residual money with the target of maximizing shareholders profit. This report will use four steps to analyze and solve the question.

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Drakensberg Limited Case Report Table of Contents Drakensberg Limited Case Report I Table of Contents II Introduction 3 1. Current market position analysis 4 1) SWOT analysis 4 2) Product analysis 7 3) BusinessStrategy 8 2. Product Activity Analysis 9 1) Basic definition 9 2) Analysis with the two existing products 10 3) Analysis of three products including Dankie 14 4) Adjustment to the optimal output point 17 5) Summary 18 3. Investment activity analysis 19 1) Company Situation 19 2) Financial Data Analysis 19 3) Summary 23 4. Conclusion 24 Reference list 25 Appendix 26 1. Estimation of fixed cost 26 2. Analysis of two existing products 26 3. Analysis of three products including Dankie 28 4. Calculation of the adjusted optimal point 30 5. Task allocation 31 Introduction Drakensberg Limited is a specialist manufacturing corporation that operates in high cost and tightly regulated economy. The company has encountered a series of problems facing the severe competition in this industry. The main problems are whether to launch a new product and how to treat the residual money with the target of maximizing shareholders' profit. This report will use four steps to analyze and solve the question. The first step is to give an insight into the current market position. In this part, SWOT analysis and product life cycle is the main focus. The second step is to point out and confirm the business strategy that guides the whole company's activity. The next step is to explore whether to launch the new product and its volume, using CVP, value chain and differentiation strategy analysis. Two scenarios (with the new product and without it) will be considered to get the proper conclusion. The last part indicates how to deal with the rich cash. Finally, some suggestions will be given for the company's future development. 1. Current market position analysis The environment surrounding Drakensberg is analyzed in the macro and micro perspective respectively. ...read more.


The new product with lower cost per unit is different from other two products thus canexpand the vertical differentiation to satisfy various customers' needs. It seems to be exploited to cater for other types of customers, therefore is useful for company to keep its market position or even gain more market shares. What's more, the selling of new product may in turns promote the selling of Nkosi and Yabnga, since it would increase brand value if the new products with good quality are popular among the customers.Consequently, a group of potential customers would pay attention to other products of our company. 4) Adjustment to the optimal output point Through the sensitivity analysis, some doubts might be cast on the optimal point. As mentioned above, the optimal output only allows Dankie, the new product to be produced at lowest level, 100 units. However, value chainand differentiation analysis show that this new product will generate great potentialprofit. In this case, if only 100 units of Dankie are produced in order to maximize the profit, the long-term development of the new product would be tremendously impeded. Therefore, a little amount of profit needs to be sacrificed to help the promotion of Dankie, which can be considered as the opportunity cost of producing the new product. It is the market share not the current profit that the new product mainly aims at. In this sense, the global demand of Dankie (i.e. 3000 units) needs to be satisfied though a huge amount of raw materials would be transferred from making Nkosi and Yabonga. Under this circumstance 17400 kg raw materials would be spent. Obviously, if we obtain that amount of raw materials through reducing the output of only one product, it is very likely to cause a huge impact on the market. Therefore, both the output of Nkosi and Yabonga should be reduced in order to leave adequate raw materials for Dankie. ...read more.


20% Prophase Task Be familiar with the difference between several methods of assessing the investment projects. Metaphase Task In charge of the calculation and analysis of investment plan with different method in order to choose the optimal project. Then make a detailed plan of how to take fully advantage of remaining fund. Anaphase Task Draft the conclusion of the whole report and help Lingyi Zhao coherent the report Lingyi Zhao (Student Number: 119105881) 20% Prophase Task Find relevant theory of Value Chain and Differentiation Analysis to overcome the team's knowledge gap in this field Metaphase Task In charge of the analysis of the strategy of the company using Value Chain with Ye Liu. Complete the final revision after Ye Liu' check. Anaphase Task Integrate different parts of other members and connect each part coherently Ye Liu(Student Number: 119080201) 20% Prophase Task Find relevant theory of Value Chain and Differentiation Analysis to overcome the team's knowledge gap in this field Metaphase Task In charge of the modification of the Value Chain part based on the work of Lingyi. Add the differentiation analysis into the report. Anaphase Task Adjust the format according to the rule of a standard report. Mo Sun(Student Number: 119369243) 20% Prophase Task Find the basic theory of SWOT analysis and carefully read the background information given by the question. Metaphase Task In charge of the description and analysis of the background information with SWOT, and clarification of the long-term strategy of the whole company. Anaphase Task Mainly draft the introduction of the report and revise the grammar and spelling mistakes. Jiawei Wu(Student Number: 119227116) 20% Prophase Task Review the materials in the lecture about the CVP analysis and Linear Programming Metaphase Task In charge of the C-Y-P analysis including bottleneck, contribution and breakeven point of the existing and newly developed products, and also the calculation of optimal point and adjusted optimal point. Anaphase Task Draft the appendix of the report and the description of task allocation ?? ?? ?? ?? I ...read more.

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