Lipman Bottle Company Essay

SynopsisLipman Bottle Company, the leading bottle distribution company in capital of radical York, bare-assed York started distributing bottles of large bottle manufacturers on 1909. From then on, they started to adapt to the changes in the bottling industry such as the use of plastics, which prove to be profitable on their end. They grab the opportunity to distribute and print bottles with various shapes and sizes for clients who liked the convenience of their dual services. Their track record became unstable when the US economy got worse and competitors opted to slice prices of their products. Robert Lipman, the vice president of the company, realized that they have no choice but to cut prices as salubrious so they can keep up the competition. However, he was unsure on how to cut the prices or what products he essential cut so that they could survive the economic downfall. He also stated that one means to keep the business going was if they could spread their distribution to pharmaceutical and cosmetics manufacturers.Statement of the ProblemWhat pricing must Lipman Bottle Company adapt in order to achieve the goal of 30% security deposit?ObjectivesThe retard of the case study is to determine the correct pricing that Lipman Bottle Company must adapt to contain that they would continue to be profitable and achieve the companys goal of reaching 30% margin. outline and SolutionVariable be were computed per 1,000 bottles were computed based on the different combinations given on the case. plug-ins 1-2 shows the variable be for capital of New York while Tables 3-4 shows the variable costs for the New York-New Jersey marketTable 1. Variable costs of smaller size bottles for Albany MarketTable 2. Variable costs of epicger size bottles for Albany MarketTable 3. Variable costs of smaller size bottles for New York-New Jersey MarketTable 4. Variable costs of bigger size bottles for New York-New Jersey MarketAfter which, we derived the break crimson off p rices for each combinations and the recommended prices based on Mr. Lipmans goal of 30% marginTable 5. have even prices for smaller size bottles, Albany MarketTable 6. Break even prices for bigger size bottles, Albany MarketTable 7. Break even prices for smaller size bottles, New Jersey-New York MarketTable 8. Break even prices for bigger size bottles, New Jersey-New York MarketHow did the Mr. Lipmans goal of a 30% margin at capacity affect your price recommendation? Comparing the increase and decrease of prices among three exertion scenarios, the 30% margin will reflect an increase of 23% on price from 1 detachment to 2 musical interval round due to the addition in labor. Whereas, a projected decrease of 16% from 2 separation round to 2 separation oval because of the labor conversion to semi-automatic Table 9. Prices (with 30% mark up) for small bottles, Albany Lower size (0-1 oz)Same principle follows when you refer to the table for big bottles. Table 10. Prices (with 30% mar k up) for big bottles, Albany Bigger size (17-32 oz)Table 11. Prices (with 30% mark up) for small bottles, New York-New Jersey Small size (0-1 oz)Table 12. Prices (with 30% mark up) for bigger bottles, New York-New Jersey Bigger size (17-32 oz)In spite of charging a higher price for 2 separation round, it may seem that it is more profitable with the New Jersey Higher Size with $105.37. But in reality, the $95.66 will have more profit compared to $105.37 becauseassuming that at 95.66 per unit, you multiply it with 100,000, which is the minimum production, you will however profit more because of the quantity. And to add, the cost of production is much lower compared to producing less like what was charged to New Jersey Higher Size with 5,000 9,999.