Barney´s operates in the high-end customized suit business

Assignment Help Operation Management

Reference no: EM13830092

Barney´s operates in the high-end customized suit business. The variable cost for producing one suit (including production cost, marketing cost, labor cost, etc.) is $65 per suit. Since Barney´s only maintains minimum showrooms, and does not own any retailing stores, the fixed rent and utilities cost is roughly 2 million dollars per year. Currently, the three largest mid-tier suit suppliers have variable costs and fixed costs as follows: ($20/suit, $6,000,000/year), ($30/suit, $5,000,000/year), ($35/suit, 4,500,000/year). The demand for mid-tier suits, overall, is 400,000 per year. Assume that every supplier has same market share

What is the maximum variable cost per suit that Barney´s should have in order to be competitive in the mid-tier market?

Reference no: EM13830092

Questions Cloud

What is a final security review : What is a final security review and why is this review so important - What are some of the outcomes resulting from this review and how are these outcomes addressed?

Managing the relationship between it department : As a general manager, describe your strategy for managing the relationship between IT department and end-users departments

Technology drivers for today information systems : Discuss the Business and technology drivers for today's information systems.

Explain why the management of quality and quality control : Explain why the Management of Quality and Quality Control is so important? How does it impact the business and customers? What could go wrong if it is not correct?

Barney´s operates in the high-end customized suit business : Barney´s operates in the high-end customized suit business. The variable cost for producing one suit (including production cost, marketing cost, labor cost, etc.) is $65 per suit. Since Barney´s only maintains minimum showrooms, and does not own any ..

Discuss whether fred is resident of australia for taxation : Discuss whether Fred is a resident of Australia for taxation purposes - Explain why the receipts in Egerton-Warburton & Ors v DFC of T (1934) 51 CLR 568 were assessable, but the receipts in IRC v Ramsay (1935) 1 All ER 847 were treated as capital a..

Furrel''s ice cream company ships ice cream in bulk : Furrel's Ice Cream Company ships ice cream in bulk from its manufacturing facility to its 25 retail outlets. Furrel's has categorized its retail outlets into four types, each of which sells a certain level of ice cream per week, measured in pounds. F..

Creative benefits imagine that you are an hr manager : Creative Benefits Imagine that you are an HR manager. You are trying to recruit and retain the best talent for your organization. In your opinion, what are the advantages and disadvantages of offering unique and creative benefits to employees?

Describe how the linear programming process : In your own words, describe how the linear programming process works. Your answer should demonstrate that you understand what a model is and how the optimization process works

User Account

All Pages