Real Time Bikes

CEO – Tom DolanOperations – Drew CummingsFinance – John BishopAdvertising – AJ Koberski

Company SWOT Strengths:

Communication Organization Brand Awareness Kids Bike sold

well Set up time was

low

Weaknesses: Can’t Design Bikes Can’t keep money Can’t keep track

of expenditures Can’t run a

business Couldn’t focus on

one market

Company SWOT Opportunities:

Kids bike market size is large

In process of creating commuter bike

Plant size is large. More profits in the future

Potential support for store

Threats: Other companies

success Prices sensitive

market Advertising

sensitive market Our first rollover set

up us for a being an unsuccessful company

Mission/Vision Statements Mission Statement: We want to provide

our community with quality cycling products, unyielding customer service, and a passion for bicycling’s abundant opportunities.

Vision Statement: Striving to be the world’s leading bike manufacturer while maintaining sustainable long-term competitive advantage.

Tasks for each Department CEO – Tom Dolan Focused on overseeing decisions made

by the Vice Presidents Worked with design team for creating

new bikes Checked over the decisions for each roll

over

Vice President of Operations – Drew Cummings

Developed and oversaw: Workforce Plant Size Batch size and setup time reduction costs Quality (pay raises, training,

maintenance, research for quality, and inspection %)

John Bishop – Vice President of Finance Controlled issuing and repurchasing

equity Dividends Oversaw long-term debt Worked with investor relations

Vice President of Marketing – AJ Koberski Supervised product pricing Organized percentages and pricing on

each bikes advertising Ensured Public Relations was evenly

balanced with each bike

Decisions for year 2015 Advertising Cost: $2,000,000 Public Relation Cost: $1,000,000 Branding Cost: $1,600,000

Total Cost: $4,600,000

Decisions for 2015 Increased price of bike from $1,600 to

$2,100 Added 20,000 SCU for plant size Increased batch size from 200 to 1,150 Setup time reduction $2,750,000 Maintenance Expenditure $2,750,000 Quality Systems $3,000,000

Decisions for 2015 Repurchased Equity $400,000

Dividend per share $0.12

Debt repaid $500,000

Decisions for 2015 Design Goal: Develop and dominate kids

bike Style and Design specs were perfect Prime cost $35

TOO LOW Caused bike to fail

Decisions for 2016 Advertising Cost: $2,150,000 Shifted Public Relations of our Magazines

higher, so we could make up some of our lost sales

Branding stayed the same. Our brand awareness was good.

Decreased bike shop and sport stores support by $800,000.

Department stores retail margin dropped by 2%.

Decisions for 2016 Decreased Quality Systems by

$500,000. Decreased inspections by 5%. Decreased raw materials from 5 weeks

to 1 weeks. Decreased price of adventure bike by

$2,100 to $1,400. Safety stock decreased from 4 weeks to

1 week.

Decisions for 2016 Designed a new kid’s bike. Specs and design was perfect. Prime cost was changed from $35 to

$58.

Decisions for 2017 Kids Bike Advertising

Total Spent: $1,300,000 Adventure Bike Advertising

Total Spent: $1,350,000 Decreased by $800,000

Total Spent on Ads: $2,650,000 Branding Cost went from $1,600,000 to

$3,000,000

Decisions for 2017 Increased sport stores by $300,000. Increased department stores by

$500,000. Also changed retail margin of

department stores by 7% (36%-43%). Decreased bike shops by 300,000 and

their retail margin by 3%.

Decisions for 2017 Purchased 10,000 SCU Increased workers by 5 Set Up Cost: $4,500,000 Quality Systems $3,500,000 Decreased maintenance by $500,000 Increased Adventure price by $200

Increased production by 13,000 Produced 130,000 kids bike

Decisions for 2017 Launched Kid’s bike. Design was a success. Chance for Real Time Bikes to make a

come back.

Decisions for 2018 ***Warning: Decisions Altered!*** You experienced a shortage of cash at

the beginning of last year. Some of your decisions had to be altered to avoid running out of cash. Decisions will have been reduced in this order:

Dividends, equity repurchase, repayment of debt, plant purchase product development

Decisions for 2018 Advertising Spent on Adventure Bike:

$450,000 Advertising Spent on Kids Bike:

$295,000 Spent $0 on Public Relations

Trying to save money where we can

Decisions for 2018 Decreased workers by 15. Purchased 5,000 SCU. Maintenance Expenditure: $2,250,000. Quality Systems: $3,250,000. Set Up Time: $4,500,000. Tried to reduce prices but keep

production % up. Increased workers salary by $2,500 in 2

years due to major cut.

Decisions for 2018 Increased support of sport stores and

department stores to $1,000,000 each. Increased retail margin by 2% each (43%-

45%) Increased price of kids bike by $90. Decreased production of kids bike by

12,000

Decisions for 2019 Spent $20,000 on public relations on the

Adventure Bike. Fired 5 employees.

(20 employees fired in the past 2 years) Couldn’t make any of changes.

Decisions for the future The $40,000,000 we received would not

have helped. At that point we were $28,000,000 in

debt. We would take $12,000,000 for the next

turn. We would have created a new commuter

bike. Increased production to make more sales. Alter retail price to be competitive.