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PRESENTATION BY RIDAB VISHAL ALEX

optical distortion, Inc. PRESENTATION BY RIDAB VISHAL ALEX. INTRODUCTION. Preliminary Analysis. Determine the cost/savings benefit to the farmer Vs. debeaking. debeaked ODI savings mortality .216 .108 .108

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PRESENTATION BY RIDAB VISHAL ALEX

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  1. optical distortion, Inc. PRESENTATION BY RIDAB VISHAL ALEX

  2. INTRODUCTION

  3. Preliminary Analysis

  4. Determine the cost/savings benefit to the farmer Vs. debeaking

  5. debeaked ODI savings • mortality .216 .108 .108 • feed 7.04 6.837 .203 • labor .034 .033 .001 • egg laying .099 --- .099 .411 cost of lens -.08 total savings per bird .331

  6. Calculation of mortality debeaked = 9% (pg. 5,first paragraph) i.e. 9% of $2.40 (exhibit 5)= $0.216 ODI = 4.5% (pg.. 5, 5th paragraph) i.e. 4.5% of $2.40(exhibit 5) = $0.108

  7. debeaked ODI savings • mortality .216 .108 .108 • feed 7.04 6.837 .203 • labor .034 .033 .001 • egg laying .099 --- .099 .411 cost of lens -.08 total savings per bird .331

  8. Calculation for the feed debeaked it is $7.04 (exhibit 5) ODI calculations 24.46 - 23.68 (on page 6, 2nd paragraph) .78 / 100 = .0078 per chicken per day .0078 * 365 = 2.847 lbs. for the whole year benefit to the farmer $158 per ton, (pg.. 6, 2nd para.) will be $0.158 per kg. 1 lbs.. = .453 kg. Benefit will be 1.28969 kg. Per hen 1.28969 * .158 = .203 therefore 7.04 - .203 = $6.837

  9. debeaked ODI savings • mortality .216 .108 .108 • feed 7.04 6.837 .203 • labor .034 .033 .001 • egg laying .099 --- .099 .411 cost of lens -.08 total savings per bird .331

  10. Calculation for labor debeaked (pg. 5, 2nd para) 3 * $2.5 = $7.50 $7.5 / 220 = $0.34 ODI (pg. 5, last para) 3 * $2.50 = $7.50 $7.50 / 225 = $.033

  11. debeaked ODI savings • mortality .216 .108 .108 • feed 7.04 6.837 .203 • labor .034 .033 .001 • egg laying .099 --- .099 .411 cost of lens -.08 total savings per bird .331

  12. Calculation for egg laying (trauma) debeaking (pg. 5, 1st para) loss one egg per 5 month total loss is 2.4 eggs per year per hen total cost per dozen = $0.50 ( exhibit 5) total loss = 50 * 2.4 / 12 = $0.099 per hen ODI no loss (pg. 5, last line)

  13. debeaked ODI savings • mortality .216 .108 .108 • feed 7.04 6.837 .203 • labor .034 .033 .001 • egg laying .099 --- .099 .411 cost of lens (pg.7, first line) -.08 total savings per bird .331

  14. Determine the variable costs per pair of lens

  15. manufacturing (pg. 2, para 5) .032 injection 12000/15 million .0008 (pg.2 para 5) box cost (pg 7, note) .00168 • Plastic box .10 • filling cost .14 • order processing .18 • total .42 divide by no. of lenses ie 250 ______ total variable cost .03448

  16. Determine the fixed costs

  17. Fixed costs a) payment to new world (pg.2, para 5) $25,000 b) office and warehouse (pg.7, table b) 196,000 c) head quarters expense (pg.7, para 2) 184,000 (assuming 20 million pair) d) salesmen 280,000 e) technical representatives 70,000 f) advertising and promotional (pg. 7, 2nd para) 100,000 g) trade shows (pg. 7, 2nd para) 100,000 total fixed costs $ 955,000

  18. Assuming seven sales men, target California (flock size 20,000 and above) as per exhibit 3. Flock size No. farms No. chickens 20000-49000 320 9,517,453 50000-99000 114 7,459,994 100000&above 8722,952,283 521 39,929,730 per salesmen can cover 80 farms each year as assumed in page 6 last paragraph so 521/80 = 6.5 so taking 7 salesmen so 7 * 40000 (pg.6 ,last paragraph) = 280,000

  19. Fixed costs a) payment to new world (pg.2, para 5) $25,000 b) office and warehouse (pg.7, table b) 196,000 c) head quarters expense (pg.7, para 2) 184,000 (assuming 20 million pair) d) salesmen 280,000 e) technical representatives 70,000 f) advertising and promotional (pg. 7, 2nd para) 100,000 g) trade shows (pg. 7, 2nd para) 100,000 total fixed costs $ 955,000

  20. Calculation for technical representatives one technical representative is enough for five salesmen (pg. 6, last para) therefore two are required for seven salesmen 2 * 35000 (pg 6, last para) = 70000

  21. Fixed costs a) payment to new world (pg.2, para 5) $25,000 b) office and warehouse (pg.7, table b) 196,000 c) head quarters expense (pg.7, para 2) 184,000 (assuming 20 million pair) d) salesmen 280,000 e) technical representatives 70,000 f) advertising and promotional (pg. 7, 2nd para) 100,000 g) trade shows (pg. 7, 2nd para) 100,000 total fixed costs $ 955,000

  22. Determine the appropriate price range $

  23. Range of pricing is between $.08 and $.24 if we use price for pair of lenses $.24 $.08 variable costs .03448 .03448 (as calculated) fixed costs .04775.04775 profits for ODI (per pair) $.1577 $(-.00223)

  24. Calculation of fixed costs $955,000 / 20,000,000 = $0.04775

  25. Range of pricing is between $.08 and $.24 if we use price for pair of lenses $.24 $.08 variable costs .03448 .03448 (as calculated) fixed costs .04775.04775 profits for ODI (per pair) $.1577 $(-.00223)

  26. Strategic analysis

  27. price selection should be $0.24

  28. The breakeven at $.24 is going to be 4,646,750 pairs of lenses. Which seems achievable because we are targeting 40,000,000.(calculated earlier)

  29. Calculation of breakeven quantity fixed costs = (price per pair - v.c. per pair) * break even quantity 955,000 = (.24 - .03448) * Q 955,000 = .20552Q Q = 955,000 / .20552 Q = 4646750

  30. is this data realistic? No!

  31. will the product succeed?

  32. Thank you

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