Claires Antiques Essay Example | Topics and Well Written Essays - 500 words

Claires Antiques - Essay Example Since the organization wouldn't like to pass the expanded commission to its clients, they should compensate for the $15, 190 reduction in benefit for the timekeepers product offering and $23, 310 and $25, 025 for dinette sets and room suites separately. The organization can compensate for this lost by requesting that wholesalers sell a lower level of the absolute expected deals volume so as to reduce the commission costs. 5. In computing the new month to month earn back the original investment volume for Claire's Antiques, we should consider the adjustments in cost and month to month fixed expense. Cutting the unit deals cost by 10% will yield $3, 300 ($3, 700 x .90) for one dinette set. Fixed cost will be expanded to $27, 250 to consider the $1, 000 promoting cost. The new commitment edge is processed as $3, 300 less factor material expense of $1, 280 which is equivalent to $2, 050. Make back the initial investment in units can be created by separating the $27, 250 fixed expense by the new commitment edge of 42, 050. This will give 13 units for Claire's Antiques to make back the initial investment every month.