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can expect a trend decrease of 93.6%. For year 14 they saw a 94.7% increase. Which was also a 101.3% increase from the previous year.
These trends show us that the company can project a 99%-101.7% increase over the years. The company shows an increase in net sales year after year with the exception of year 13. Custom Snowboards Inc. relies on these forecasted sales to come from major sporting events, competitive sporting, and other events. They may increase their sales prices to help lower the effects of the downturned economy on the company.
I would highly recommend the company start to utilize activity based costing in order to see which models are making the most money to increase profitability. This way the company can distribute money more efficiently if they need additional advertising help to boost sales or high better management to oversee production.
Another way the company can help future performances is to base salaries and raises on company performance. There are more incentives for employees to continue to have more lucrative years if the company performs well in the market. Maybe switch to commission sales or a fluxuating salary depending on quarterly …show more content…
Summary
Now that the decisions has been made to expand into the new European market Custom Snowboards has a lot of decisions to make. For example which corporate strategy to utilize to make sure the result will ensure a great return on investments. They have two options: They can build their own infrastructure in Europe, or merge/acquire an existing company called European SnowFun Inc.
From the above section the more viable option of buying a building or leasing a building proved that leasing was the better choice for the company. The also need to decide where this new plant will be located.
Option #1 Building from scratch
Pros: This option gives the company to deal with existing problems from European SnowFun Inc. Custom Snowboards Inc. can come to Europe with its own staff or hire its own staff and truly start from scratch. No drama or fear of layoffs from existing employees. Flexibility: If things don’t go as planned after their five year lease they can leave the market with out financial penalties or further obligations. Custom Snowboards can continue their operations the way they seem fit for their investment and not have to take advice from anyone …show more content…
There are several benefits to choosing this capital structure. The first being high earning per share will make investors happy and more likely to invest future funds. This structure also has the ability to help Custom Snowboards Inc. credit increase if they make their payments on time, which will help future financing get approved quickly. Custom Snowboards can also deduct principal and interest on the income taxes at the end of the year. However, there are a couple of cons to also consider. Taking out that large of a loan may hinder the company ability to obtain further funds in the event of a disaster. If Custom Snowboards cannot make their payments on time it can damage their credit making it harder to obtain financing at reasonable
These trends show us that the company can project a 99%-101.7% increase over the years. The company shows an increase in net sales year after year with the exception of year 13. Custom Snowboards Inc. relies on these forecasted sales to come from major sporting events, competitive sporting, and other events. They may increase their sales prices to help lower the effects of the downturned economy on the company.
I would highly recommend the company start to utilize activity based costing in order to see which models are making the most money to increase profitability. This way the company can distribute money more efficiently if they need additional advertising help to boost sales or high better management to oversee production.
Another way the company can help future performances is to base salaries and raises on company performance. There are more incentives for employees to continue to have more lucrative years if the company performs well in the market. Maybe switch to commission sales or a fluxuating salary depending on quarterly …show more content…
Summary
Now that the decisions has been made to expand into the new European market Custom Snowboards has a lot of decisions to make. For example which corporate strategy to utilize to make sure the result will ensure a great return on investments. They have two options: They can build their own infrastructure in Europe, or merge/acquire an existing company called European SnowFun Inc.
From the above section the more viable option of buying a building or leasing a building proved that leasing was the better choice for the company. The also need to decide where this new plant will be located.
Option #1 Building from scratch
Pros: This option gives the company to deal with existing problems from European SnowFun Inc. Custom Snowboards Inc. can come to Europe with its own staff or hire its own staff and truly start from scratch. No drama or fear of layoffs from existing employees. Flexibility: If things don’t go as planned after their five year lease they can leave the market with out financial penalties or further obligations. Custom Snowboards can continue their operations the way they seem fit for their investment and not have to take advice from anyone …show more content…
There are several benefits to choosing this capital structure. The first being high earning per share will make investors happy and more likely to invest future funds. This structure also has the ability to help Custom Snowboards Inc. credit increase if they make their payments on time, which will help future financing get approved quickly. Custom Snowboards can also deduct principal and interest on the income taxes at the end of the year. However, there are a couple of cons to also consider. Taking out that large of a loan may hinder the company ability to obtain further funds in the event of a disaster. If Custom Snowboards cannot make their payments on time it can damage their credit making it harder to obtain financing at reasonable