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Scenario: ABC Company sells widgets in three varieties (blue, red, and yellow) but has lost money for the past three years. Competitive intelligence shows the Company's products are priced 10% above the competition but that competitor prices will increase by at least 8% annually. Given the Company is mandated by Widget Cost Reform (WCR) to spend a minimum of x% of revenue on cost of goods sold (COGS), what actions would you recommend to the CFO? What are the key drivers to attaining profitability by 2015?
Please use the peach colored cells for your inputs and formulas in order to reach profitability and still satisfy the minimum WCR Expense Ratios mandated by the WCR regulations.
Facts
MARGINAL ANALYSIS It is difficult to develop the conditional profit table when there are a large number of scenarios and possible actions. The marginal analysis approach sides
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