Business
SLP 5, Last Time Warp for the Clipboard Tablet Company
It is January 1st 2012 again, and the time warp has re-started. This time there is a difference, the results for the last time warp (SLP 4) have been reviewed and new strategies have been developed based on that last time warp based on the observations and the CVP calculations. The aim of this paper is to implement the predetermined strategies and compare the results with the last time warp.
There were several issues highlighted in the last time warp. The most significant were the issues associated with the X7, it was noted that in the last time warp, the performance compared to competing products was poor, and the price was high. Therefore, to make the product competitive using the CVP analysis would require a significant level of investment, along with the acceptance of a lower profit margin. Therefore, rather than continue with this product, which may also cannibalize the X5 and X6, the difficult decision was made to abandon the X7. This will mean suffering the sunk costs, but in good financial decision making sunk costs should not bias the decision for the future (Chadwick, 2007)
This leaves the firm with only two products, the X5 and X6. The X5 showed good performance in the last time warp, although it had a limited lifecycle left. The X6 was the most profitable, and was seen to perform well. The decision for these products will reflect their market potential. The pricing levels will remain the same, at $285 for the X5 and $430 for the X6. However, as the X5 is nearing maturity, it may argued that investing more money into research and development may be unwise, as there is not a long-term potential to benefit from...
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