Section C Strategic Alignment & Auditing

5. Financial Analysis:

Background: Company X chooses the differentiation (product leadership) strategy.

§ Based on the data 2, please calculate the following metrics:

o Gross Margin %

o Operational expense Ratio %

o Gross Profit %

o Net Profit %

§ Based on data 1 to 6, please write a critical analysis about the company’s performance (e.g., the strengths and weakness of their marketing actions, such as price setting, R&D plan, etc.) and make some recommendations if possible. Please do apply relevant marketing principles to justify your arguments.

6. Logistic Issues & Solutions

Background: Company Y has a serious logistic issue, as shown in data 7. There are 2 possible distributors to choose (from data 8). Your task is to decide which distributor is a better option for company Y (Black Supplier or LTC).

Hints:

§ Determine how many pairs of shoes company Y would need every 3 weeks and 4 weeks (Note: it is always better to be a bit oversupply than undersupply).

§ Calculate how much it would cost if using Black Supplier & LTC. Which one is cheaper?

§ Your suggested inventory level and order level (image below)

§ Write a paragraphs and use tables or graphs (where possible) to explain your decision.

Data