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“The Lazy Mover” Is It Really Worth It?

“The Lazy Mover” Is It Really Worth It?. Becca Massanova Andrew Rosenman Sharanpreet Kaur Alex Villar. CASE 13 October 23 rd , 2011. Introduction. Innovative Products Inc.’s revenues are declining New, highly Conservative CEO New prototype “The Lazy Mower” is introduced

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“The Lazy Mover” Is It Really Worth It?

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  1. “The Lazy Mover”Is It Really Worth It? BeccaMassanova Andrew Rosenman SharanpreetKaur Alex Villar CASE 13 October 23rd, 2011

  2. Introduction Innovative Products Inc.’s revenues are declining New, highly Conservative CEO New prototype “The Lazy Mower” is introduced Detailed study of the new prototype: whether or not it would be profitable for the company

  3. Forecasting the Cash Flows:

  4. Cash Flow Analysis: IRR = 60.77% NVP = $45,750,028.33 NPV is used over IRR due to reliability. NPV is positive : The Firm should invest in the Project

  5. Scenario Analysis: Cash Flows Affected : 15% worse or better than expected Even at 15% worse Sales Forecast : The Firm is still creating value ($35,798,233.82)

  6. Sensitivity Analysis Variables: Investment, Revenue, Variable and Fixed Cost Revenue has the largest effect on NPV

  7. Conclusion Cash Flow Analysis: NPV is positive Even at the 15% worse sale forecast : NPV is positive Revenues has the largest effect on NPV : NPV is still positive Therefore, the Company should invest in “The Lazy Mower”

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