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MBA 520 MBA520 MBA/520 Week 3 Ass 1.docx – Value-based Management

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MBA 520 MBA520 MBA/520 Week 3 Ass 1.docx – Value-based Management

Value-based Management Megan Flanagan May 19, 2020 Champlain College MBA 520

Value-based Management

442 McAdam is a designer handbag company out of Toronto, Ontario. In recognizing a demand for the handbags, it was decided that production should be outsourced using either a local manufacturer or an international manufacturer, (Welsh, 2016).

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Champlain College, MBA 520 MBA520 MBA/520 Week 3 Ass 1.docx - Value-based Management

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MBA 520 MBA520 MBA/520 Week 3 Ass 1.docx – Value-based Management

Value-based Management Megan Flanagan May 19, 2020 Champlain College MBA 520

Value-based Management

When Sarah Shell moved thecompany from Calgary to Toronto, she saw it as possible to expose her business to a great vast ofopportunity. With the increased cliental, orders would need to be fulfilled via mass-production.

Using either a local or international manufacturer has risks and benefits.Local manufacturing provides Shell the benefit of being able to closely monitor the production process. Local buying is also a new trend and this could give 442 McAdam a competitive edge.

Another great benefit is that she will have control over inventory levels and can waste less material by being able to fulfill a minimum quantity for each design. Collaboration with the manufacture on new designs could also be very beneficial.

On the other hand, using a local company would prove to be much more expensive at $120 per handbag requiring a minimum of 10 handbags of each design and color while international manufacturers charged $80 per handbag but required a minimum order of 50 handbags, (Welsh, 2016).

Shell would also have to consider any undisclosed expenses as well.Using an international manufacturing company, the production cost would be significantly lower than local manufacturing. Shell’s biggest objective is to increase revenue and save on expenses. She could benefit in negotiating lower payments with an international

MBA 520 MBA520 MBA/520 Week 3 Ass 1.docx – Value-based Management

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MBA 520 MBA520 MBA/520 Week 3 Ass 1.docx – Value-based Management

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MBA 520 MBA520 MBA/520 Week 3 Ass 1.docx – Value-based Management

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MBA 520 MBA520 MBA/520 Week 3 Ass 1.docx – Value-based Management

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