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Foxy Case Study

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1. Discuss the pros and cons to launching the foxy brand in the United States. Pros | Cons | U.S. market is 10 times larger than Canada. With right business model and price, foxy would gain additional revenue and profit.
The brand seeks great opportunity to further develop the business, enhance product design as well as company’s brand image. | U.S market is different in terms of tastes for jewellery. American preferred the latest trend regardless of the product’s origin. It might take foxy some time to adapt to different customers and create new product to compete within that larger market. Foxy may face risk in controlling the business from far; where Foxy’s HQ based in Canada. These means that Foxy Original need to build their …show more content…

For each distribution strategy, calculate the unit contribution and contribution margin rate for each of the two products line (necklaces and pairs of earrings). What is the weighted average contribution margin for an order at a trade show and an order with sale representatives?

Trade Show | Sales ($) | Unit VC ($) | Unit Contribution Margin | Product Qty | Sales mix (Percentage) | Weighted-average contribution margin | Necklaces | 17 | 8.65 | 8.35 | 25 | 67.57 | 5.64 | Earrings | 12 | 6.75 | 5.25 | 12 | 32.43 | 1.70 | Total | | | | 37 | 100 | 7.34 |

S.R. | Sales ($) | Unit VC ($) | Unit Contribution Margin | Product Qty | Sales mix (Percentage) | Weighted-average contribution margin | Necklaces | 17 | 10.60 | 6.40 | 25 | 67.57 | 4.32 | Earrings | 12 | 7.30 | 4.70 | 12 | 32.43 | 1.52 | Total | | | | 37 | 100 | 5.84 |

8. Calculate Foxy’s breakeven point for each distribution strategy

Breakeven point for year 2005

a) Trade show
Breakeven point TS=94,333.337.34 =12,852

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