| Analysis |
Scale |
Millions
| |
|
|
 |
| Year |
1 |
2 |
3 |
4 |
5 |
| Market Demand |
76 |
|
|
|
|
| Market Growth Rate |
6.5 % |
|
|
|
|
| Market Share Objective |
0.5 % |
1.0 % |
1.5 % |
2.0 % |
2.5 % |
| Volume Sold |
1.5 |
0.5 |
0.5 |
0.4 |
0.2 |
| Average Consumer Price |
$80.00 $ |
$80.00 $ |
$80.00 $ |
$80.00 $ |
$80.00 $ |
| Channel Expenses (% Price) |
65.0 % |
50.00 |
30.00 |
25.00 |
75.00 |
| Company Net Price |
60.0 |
25.0 |
15.0 |
10.0 |
15.0 |
| Sales |
1.5 |
0.5 |
0.5 |
0.4 |
0.2 |
| Cost per Unit |
$16.00 $ |
$16.00 $ |
$16.00 $ |
$16.00 $ |
$16.00 $ |
| Percent Gross Margin |
24.0 |
10.0 |
7.5 |
2.5 |
4.5 |
| Gross Profit |
1.5 |
0.5 |
0.5 |
0.4 |
0.2 |
| Marketing & Sales Expenses ($) |
$12.0 $ |
$10.0 $ |
$10.0 $ |
$10.0 $ |
$10.0 $ |
| Marketing & Sales Expenses (% sales) |
15.5 |
6.0 |
5.5 |
1.0 |
2.0 |
| Net Marketing Contribution |
5.5 |
2.0 |
3.5 |
-1.0 |
0.0 |
| General Administration (% sales) |
4.5 % |
4.5 % |
4.5 % |
4.5 % |
4.5 % |
| General Administration (dollars) |
0.5 |
1.1 |
1.8 |
2.6 |
3.4 |
| Operating Income |
182 |
150 |
275 |
67 |
80 |
|
| Discount Rate |
30.0 % |
|
|
|
|
| Present Value Factor |
182 |
150 |
275 |
67 |
80 |
| Present Value |
182 |
150 |
275 |
67 |
80 |
|
| Profitability & Risk Metrics |
|
|
|
|
|
| Net Present Value |
182 |
|
|
|
|
| Internal Rate of Return |
43 % |
|
|
|
|
| Return on Sales |
182 |
150 |
275 |
67 |
80 |
| Breakeven Market Share |
182 |
|
|
|
|
| Marketing ROI |
182 |
150 |
275 |
67 |
80 |
IM.6: International Market Profit Potential & Risk (see Figure 30)
