Alternatives 1 produce and sell bricks at 774

  • Brock University
  • MBAB 5P06
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  • sharlene821
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which is 2,296,000 units, the company still can make Rs 260,000 profit. Alternatives 1. Produce and sell bricks at 77.4% capacity (3,096,000 bricks per year) The reasons why produces bricks at this product level is that if company wants to recover working capital in full within project, it needs to generate Rs2 million as profit at least one year. According to the profit formula, the product level to reach this profit is 3,096,000 bricks. 2. Produce and sell bricks at 100% capacity (4,000,000 bricks per year) If company produce and sell bricks at this level, it can make full use of productivity and generate the profit to a maximum level. Decision Criteria Recommendation
Implementation When Who What May 2013 Sharma Obtain support from government. For example: Apply tax discount for net income. Request government to establish a more efficient supply channel to reduce relevant cost. May 2013 Gupta Sell our bricks to construction company and building sectors. Maintain a continuous supply order. May 2013 Sharma Communicate with market segment in our company to effectively use mass media to publicity environmental concept to the general public and raise people’s environmental protection awareness. June 2013 All staff in company Simplify all operational processes: Reduce operational cost and production lead time Implement lean operation Avoid waste of raw materials and production time Contingency plan If Sharma cannot achieve the goal of increasing the capability, which is 77.4%, to get working capital back at the end of the project, keeping the sales volume of 2.4 million bricks is the contingency plan in order to maintain the corporation operation with enough funds. As a result, in case if some previous implementation will not be available to increase the sales reaching the 3096000 bricks, the company is able to operate without loss under the current production.

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