Assume Fruit Delight Beverages Has Discovered a Problem Involving the Mix

question 51

Essay

Assume Fruit Delight Beverages has discovered a problem involving the mix of flavor to their seltzer water that costs the company $4,000 in waste and $2,800 in lost business per period.There are two alternative solutions.The first is to lease a new mix regulator at a cost of $4,000 per period.The new regulator would save Fruit Delight Beverages $2,000 in waste and $2,000 in lost business each period.The second alternative is to hire an additional employee to manually monitor the existing regulator at a cost of $2,900 per period.This would save Fruit Delight Beverages $1,400 in waste and $800 in lost business per period.
Required:
Which alternative should Fruit Delight Beverages choose?
(Fruit Delight Beverages;Quality versus costs. )

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Definitions:

Repeat Customers

Individuals or entities that make purchases from a business on more than one occasion over a period of time.

Cross Selling

A sales strategy in which a seller encourages existing customers to buy additional or related products or services.

Cross-Buyer

A consumer who purchases multiple products or services from the same company, often encouraged through cross-promotion or bundling.

Discounted Prices

Reduced prices offered on goods or services, often as a promotion or to attract more customers.