Cumberland Metal Industries

Cumberland Metal Industries (CMI) should price their new cushioning inkpads at $900 to increase profit. CMI should begin by targeting the customers that impart find the greatest think of in the product an pay the most. This allow the company to maximize unit contribution, and leave available options for dealing with future controversy and sales challenges. Customer CMI estimates a potential customer base of 19,500 to 26,000 actively operating pile drivers in the United States. Currently the food market approaches cushion pads as an afterthought; pads are available for $2-$10 depending on size. The pads are produced by various local shops; CMI will be the first major industrial producer in the market. The introduction of a new and more expensive pad may require some time to gain credence in the market place. Many pads are purchased by equipment leasing companies whose inducement is to keep their equipment rented by prolonging the job; this may eliminate renting hammers from the initial market. The remaining market is divided into two groups; main(a) contractors who may be skeptical about the cost and tumescent contractors.

Large Contractors are the primary market, they are interested in reducing costs, and open fire afford the more expensive pads, and to boot they are more likely to see the potential tax in the product. There are approximately 13,000 active machines in this group. This initial market is likely to understand the value and be accepting of the $900 price. Cost Using the equipment CMI currently has in place pads can be produced at a variable cost of $44.44 for an 11.5 indium pad. Fixed costs for labor and equipment equal $28.80. The company prefers to take care fixed cost at an amount 360% of labor to bank note for engineering changing the fixed amount to 103.68. The accounting policy will not accurately reflect the engineering charm required to create the pads and could be reconsidered. The pads will subsidize opposite products. These costs will go... If you want to get a integral essay, order it on our website: Orderessay

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