Blair Cannon

Nikita Gowin

Joey Fleming

North America

Europe-Africa

Asia-Pacific

Latin America

BEST in Industry KSF- (FIRST ranked team) Economy of Scale

Costs/total assets $352,929,000/$832,080,000= .42Lower EOS is better with growth strategy

Increased operating capacity Built new plant in unsaturated market

Maintaining 3 manufacturing plants in 3 different regionsFirst mover’s into the Latin America region

Leads to lower costs/expenses per unitMore effective and efficient operations

Leads to more profit and increased profit margin

BEST in Industry KSF- (FIRST ranked team) Celebrity Appeal

Multiple long-term contracts with celebrities

Effects: Increased branded sales volumeIncreased market shareIncreased image rating

BEST in Industry KSF–(FIRST ranked team)

G* (index of sustainable growth) G*=(1-dividend payout ratio)*ROE

G* = (1- 387/73174)30= 29.84

Higher the G* the better it is for growth

Long term financing/debtUsed funding to increase capacity and

equipment allowing for economy of scale

Financial leverage also helps in magnifying ROE

BEST in Industry KSF-(Last ranked team)

Economy of Scale

Costs/total assets $150,985,000/226,390,000= .67

Have not achieved Economies of Scale

Increased their spending but not enough to meet Economies of Scale

BEST in Industry (LAST ranked team)G*(index of sustainable growth)

Have a low G* because of their low ROE

G*=(1-dividend payout ratio)*ROE

G*=(1-0)*6.4= 6.4

Compared to the first ranked company who has a G* equal to 29.84

BEST in Industry KSF- (LAST ranked team) Celebrity Appeal

Have 2 celebrities in Europe, but not utilizing European market.

Not taking enough risks with investing in advertising.

Only increased by 1000

Effects:

Increased market share in internet

Decreased market share in wholesale

Lost sales increased significantly