The executives of your company met. They are organized in 3 regions: Americas (South & North), Europe, and Asia/rest of the world. For 2021, there is a limited amount of money that can be assigned to the Marketing Budget. Pick one of the regions, and justify why your region should be funded, instead of the others. If you want to increase your budget for new launches, please use the payback template and share what’s the payback for your investment in the comments.
Comments instead
0.Headcount
Headcount
Your company asked executives like yourself to share their comments on whether to increase, decrease or keep the global headcount unchanged for the next 18 months year.
Human resources pointed out that they need at least 3 months to hire anyone.
Real Estate pointed out that there is no physical space to hire any more people, but they are looking into adding space in Hudson Yards for resources based in New York. For that reason, they need you to get back to them over the next week.
Finance sent a memo indicating that you need to budget a cost allocation of $36,000 per person per year to cover health care and rent. That is on top of all payroll expenses.
Please write your recommendation below on whether you want to increase, decrease or keep the global headcount unchanged for your department.
Read more about this session here:
1. P&L
How to explain a Profit & Loss
During a Thanksgiving chat with family and friends, how would you explain the P&L of a company you are interested in? You do want to impress your uncle, who works as a banker at Goldman Sachs, but don’t want to bore the other people sitting at the table.
To explain it, try to split the P&L into the 3 main segments: sales, cost of sales, and expenses. The difference is Net Income. Use the % of sales ratios in your discussion.
See the short video on how to read a P&L here:
2. Collect Faster and Pay later (BS)
1 Due to the launch of a new product, your company is low in cash. You have been asked to reduce Accounts Receivables, increase Accounts Payable, or both.
Please design a strategy including offering cash discounts to customers who pay in advance, letting small businesses pay with a credit card (quantify what would be the cost of accepting credit cards), and/or delaying payments to Suppliers (quantify what would be the cost of foregone cash discounts and/or destroying goodwill).
2 Many customers want to have the new products, but you dont have enough of it. Would you prioritize old customers or new customers?
2. Customer Prioritization (BS)
Your company launched an upgrade to your most popular product. Demand exceeds the Inventory or stock of products you have.
You can supply only 50 customers. 100 of them want to place an order. That includes:
- 48 new clients. Some of those clients you have been trying to get for them for the last ten years. This is your only chance to get these new clients.
- 48 old clients. They have been with your firm since the beginning. They will be offended if they don’t get it. One of them is a buyer you see when you go watch your niece’s soccer games, she is always there.
- One new client and one old client who is nice. They will understand if they don’t get it.
Whom should you prioritize?
3. Pricing
Your company asked executives like yourself to comment on whether to increase, decrease, or make no changes to pricing. Please share your comments below.
Background
Cost: a reduction in production capacity and foreign exchange has resulted in an overall cost increase of 30%.
Government regulations: a regulatory change has reduced how many consumers can buy the product at any given time by 50%.
Consumer demand: sales dropped last year. They have recovered some.
Profitability: the profitability of products varies from -20% (some products are sold at a loss) to +80%.
Please share your thoughts below on what to do about pricing.
See a short video about this session here: