Brandon Production Is a Small Firm Focused on the Assembly

question 28

Essay

Brandon Production is a small firm focused on the assembly and sale of custom computers. The firm is facing stiff competition from low-priced alternatives, and is looking at various solutions to remain competitive and profitable. Current financials for the firm are shown in the table below. In the first option, marketing will increase sales by 50%. The next option is Vendor (Supplier) changes, which would result in a decrease of 10% in the cost of inputs. Finally there is an OM option, which would reduce production costs 25%. Which of the options would you recommend to the firm if it can only pursue one option?
In addition, comment on the feasibility of each option.
$$\begin{array} { l r } \text { Business Function } & \text { Current Value } \\\text { Cost of Inputs } & \$ 50,000 \\\text { Production Costs } & \$ 25,000 \\\text { Revenue } & \$ 80,000\end{array}$$

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Definitions:

Antifederalist

Individuals who opposed the creation of a stronger U.S. federal government and the ratification of the Constitution in 1787-88, preferring more power to be held by state governments.

Federalist

An advocate or supporter of federalism, particularly referring to those who supported the ratification of the U.S. Constitution in the late 18th century.

Bill of Rights

The initial ten amendments to the United States Constitution, guaranteeing fundamental rights and liberties to American citizens.

Antifederalists

Individuals who opposed the ratification of the U.S. Constitution, favoring stronger state governments over a centralized federal government.