Decision of granting customers higher or lower prices based on supply chain costs specific customers
This assignment is subject to the Late Submission penalty policy, namely 5% per day for three days. This page will close and will not allow further submissions after this Late Submission period has expired. In the event of an emergency preventing you from submitting within this time, special permission must be obtained from your instructor. Documentation substantiating emergency is required. In such a circumstance, if the extension is granted, the professor will reopen the submission function for you on an individual basis.
Please do not email your submissions to your professor, either before or after the due date; all coursework should be submitted through the online course (Moodle). Objectives Design an Activity-Based Costing system for a supply chain Analyze a business case, recognizing how to deal with customers based on their contribution to cost Assessing customer profitability Using customer cost and profitability data to make strategic decisions Materials Required Solution_Template_Johnson_Beverage.xlsx Lynch, L. J. (2009). Johnson Beverage, Inc. Ivey Publishing. Optional Ellet, W. (2007). The case study handbook: How to read, discuss, and write persuasively about cases. Harvard Business Publishing. Instructions Read the case carefully to understand the situation of making this important decision of granting customers higher or lower prices based on the supply chain costs specific customers make.
The case includes situational information, as well as numerical data, which should be combined to perform the appropriate analysis and reach the correct decision. An Excel template is provided for guidance on performing supply chain cost analysis, dissecting costs among customers, and assessing customer profitability. Through the case questions, you are walked step by step to reach your final decision. For grading, you should submit your Excel workbook, along with a word document answering and explaining case questions in detail. The Word document should be 2 to 3 pages. A brief introduction and conclusion to wrap up your findings should also be given.
Case Questions Use the information in case Exhibits 1 and 2 and other necessary data in the case on activities and costs to develop an Activity-Based Cost system for JBI, i.e., how much each activity is costing JBI for each customer. Excel templates are available (Sheets 1 and 2) to guide your work. Use this ABC system to determine customer profitability for Saver Superstore, Oscar’s Oddlots, Midewellen Supermarket, and Downtown Retail (Sheet 2 of the provided template). Use your results from Sheet 2 to compare customer costs and profits of the traditional costing system to the ABC system you have designed in (1). According to your ABC system, would you recommend entertaining a lower price to Saver SuperStore? Evaluation The following rubric indicates those areas you should be focusing on in preparing your assignment, and how the instructor will weigh these components relative to one another.
Activity/Competencies Demonstrated % of Final Grade
a. Correct ABC design according to the data given (Excel) /30
b. Correct explanation of the numbers and issue on hand – referring to the case questions /20
c. Concluded the correct decision based on the performed analysis /20
2. Writing and organization) a. Language (spelling, grammar, citation)b. Information organized intelligently and holistically /10 c. Formal Introduction and Conclusion to essay