MBA 580 Module 2

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Southern New Hampshire University *

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580

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Business

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Jan 9, 2024

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Uploaded by msmith605

Michael Smith MBA 530 Professor Paul Markham 12/17/2023 Financial Justification Sales Forecast Data-Option A 0 1 2 3 4 5 6 7 8 9 10 0 50 100 150 200 250 300 350 Chart Title Sales forecast Data Option A Tradiitional Sales forecast Data Option A Connected Sales forecast Data Option A Connected Sales Forecast Data-Option B 0 1 2 3 4 5 6 7 8 9 10 0 50 100 150 200 250 300 Chart Title Sales Forecast Data-Option B Traditional Sales Forecast Data-Option B Connected Sales Forecast Data-Option B Connected

Gross Margin Forecast Data- Option A 0 1 2 3 4 5 6 7 8 9 10 0 5 10 15 20 25 30 35 40 45 50 Chart Title Gross Margin Forecast Data - Option A Traditional Gross Margin Forecast Data - Option A Connected Gross Margin Forecast Data- Option B 0 1 2 3 4 5 6 7 8 9 10 0 5 10 15 20 25 30 35 40 45 Chart Title Gross MarginForecast Data- Option B Traditional Gross MarginForecast Data- Option B Connected Gross MarginForecast Data- Option B Connected

Gross Margin Less R&D and Capital Loss 0 1 2 3 4 5 6 7 8 9 10 0 5 10 15 20 25 30 35 40 45 50 Chart Title Gross Margin Less R&D and Capital Loss Option A Gross Margin Less R&D and Capital Loss Option B Gross Margin Less R&D and Capital Loss Option B Gross Margin Less R&D and Capital Loss Option B Total gross margin less R&D and capital costs forecasts to compare options A and B

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Data Visualization Depending on the data collected, Option A in two years shows 10.2% growth for the companies connected car business. After 25% annual growth is forecasted. This is a slow growth. First the data supports faster venue growth over time compared to option B. Looking at sales forecast data for option B sales volume estimate attached vehicles have a profitability of 21%, standard vehicles have a profit of 15%. If we go with option A, we can expect our operation margin will shrink over ten years. All the information presented in the graphs and the data collected show that despite option A starting off at a slower pace than option B, it achieves a higher rate of sales growth. Option A will provide the company with a proper advantage. In conclusion the data supports a slow integration of connected vehicles. Traditional vehicles have less initial startup R&D, however parts over time may become harder to source and producing the same vehicle year over year may stagnate the market. However, the high cost of R&D and balancing the feature benefit to the customer within a target price point is key. Beyond the consumer market the economic conditions must also be taken into account and the company must be ready to pivot if the economy crashes or if loans become hard to the consumer to secure to purchase the new vehicle.

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