Capstone® Industry Conditions Report For C94032 Your instructor can customize the simulation scenario. The information below is specific to your industry. Printable and Downloadable PDF Version of This Report The sensors your company manufactures are incorporated into the products your customers sell. Your customers fall into five groups which are called market segments. A market segment is a group of customers who have similar needs. The segments are named for the customer's primary requirements and are called: Drift Rates Each year, the segments drift the length of the hypotenuse of the triangle formed by customers' desire for smaller and faster products. Table 1 Segment Circle Drift Rates: Every year, customers demand increased performance (Pfmn) and decreased size. 1 of 8 Capstone® Industry Conditions Report For C94032 demand increased performance (Pfmn) and decreased size. Note that the drift rates vary for each segment. Pfmn Size Traditional +0.7 -0.7 Low End +0.5 -0.5 High End +0.9 -0.9 Performance +1.0 -0.7 Size +0.7 -1.0 Segment Centers Table 2 Segment Centers at the End of Each Round: As shown in the Perceptual Map Form above, size is on the vertical axis and performance (Pfmn) is on the horizontal axis. Traditional Low End High End Performance Size Round Pfmn Size Pfmn Size Pfmn Size Pfmn Size Pfmn Size 0 4.4 15.4 1.9 17.9 6.9 12.9 7.4 17.4 2.4 12.4 1 5.1 14.7 2.4 17.4 7.8 12.0 8.4 16.7 3.1 11.4 2 5.8 14.0 2.9 16.9 8.7 11.1 9.4 16.0 3.8 10.4 3 6.5 13.3 3.4 16.4 9.6 10.2 10.4 15.3 4.5 9.4 4 7.2 12.6 3.9 15.9 10.5 9.3 11.4 14.6 5.2 8.4 5 7.9 11.9 4.4 15.4 11.4 8.4 12.4 13.9 5.9 7.4 6 8.6 11.2 4.9 14.9 12.3 7.5 13.4 13.2 6.6 6.4 7 9.3 10.5 5.4 14.4 13.2 6.6 14.4 12.5 7.3 5.4 8 10.0 9.8 5.9 13.9 14.1 5.7 15.4 11.8 8.0 4.4 The information in Table 2 reflects the segment centers at the end of the round. Therefore, the Round 0 positions can be seen as the Round 1 starting positions, Round 2 positions can be seen as the Round 3 starting position, etc. Each month during the simulation year, the segment drifts 1/12th of the distance from the starting position to the ending position. Ideal Spots Table 3 Ideal Spot Offsets: Customers prefer products located this distance from 2 of 8 Capstone® Industry Conditions Report For C94032 the center of the segment circle. Pfmn Size Traditional 0.0 0.0 Low End -0.8 +0.8 High End +1.4 -1.4 Performance +1.4 -1.0 Size +1.0 -1.4 The information in Table 3 shows the Ideal Spot "offsets" or distances from the segment center. The ideal spot is that point where, all other things being equal, demand is highest. It is different from the segment center. Why are some ideal spots ahead of the segment centers? The segments are moving. From a customer’s perspective, if they buy a product at the ideal spot, it will still be a cutting edge product when it wears out. 2 Segment Sizes and Growth Rates At the beginning of the simulation, Traditional and Low End sell more units than the high technology segments, High End, Performance and Size. Page 10 of the Capstone Courier, the Market Segment Report, displays total industry sales. Each market segment grows at a different rate. Table 4 lists the beginning segment growth rates for your industry. The growth rates might change from year to year. Check the Segment Analysis reports in the Capstone Courier each round for the upcoming year's growth rates. Table 4 Beginning Segment Growth Rates Traditional 7.0% Low End 14.4% High End 21.0% Performance 17.6% Size 16.5% 3 Buying Criteria By Segment These are your products and the primary segments they sell into at the beginning of the simulation. These can change according to your decisions and as the simulation evolves. Baker Traditional Bead Low End Bid High End Bold Performance Buddy Size 3 of 8 Capstone® Industry Conditions Report For C94032 The buying criteria for each segment, in order of importance, are displayed below. Positioning and Age score information also display. Passing your cursor over an image will enlarge it. See Chapter 3 of the Team Member Guide for explanations of Positioning, Age, Price and MTBF scores. 3.1 Traditional Segment Buying Criteria (Round 0) Traditional customers seek proven products at a modest price. Age, 2 years – importance: 47% Price, $20.00-$30.00 – importance: 23% Ideal Position, performance 4.4 size 15.4 – importance: 21% MTBF, 14,000-19,000 – importance: 9% Industry Conditions Figure 3.1: Traditional Buying Criteria Traditional customers give higher position scores to sensors located in the center of the segment circle. Traditional customers give higher scores to sensors in the 2 year range. 3.2 Low End Segment Buying Criteria (Round 0) Low End customers seek low prices and well proven products. Price, $15.00-$25.00 – importance: 53% 4 of 8 Capstone® Industry Conditions Report For C94032 Age, 7 years – importance: 24% Ideal Position, performance 1.1 size 18.7 – importance: 16% MTBF, 12,000-17,000 – importance: 7% Industry Conditions Figure 3.2 Low End Buying Criteria Low End customers prefer inexpensive sensors with slower performance and larger size. Low End customers give higher scores to sensors in the 7 year range. 3.3 High End Segment Buying Criteria (Round 0) High End customers seek cutting-edge technology in size/performance and new designs. Ideal Position, performance 8.3 size 11.5 – importance: 43% Age, 0 years – importance: 29% MTBF, 20,000-25,000 – importance: 19% Price, $30.00-$40.00 – importance: 9% Industry Conditions Figure 3.3 High End Buying Criteria 5 of 8 Capstone® Industry Conditions Report For C94032 High End customers demand cutting edge sensors with high performance and small size. High End customers give higher scores to newer sensors. 3.4 Performance Segment Buying Criteria (Round 0) Performance customers seek high reliability and cutting edge performance technology. MTBF, 22,000-27,000 – importance: 43% Ideal Position, performance 8.8 size 16.4 – importance: 29% Price, $25.00-$35.00 – importance: 19% Age, 1 year – importance: 9% Industry Conditions Figure 3.4 Performance Buying Criteria 6 of 8 Capstone® Industry Conditions Report For C94032 Performance customers emphasize performance over size. Performance customers want sensors in the 1 year range. 3.5 Size Segment Buying Criteria (Round 0) Size customers seek cutting edge size technology and younger designs. Ideal Position, performance 3.4 size 11.0 – importance: 43% Age, 1.5 years – importance: 29% MTBF, 16,000-21,000 – importance: 19% Price, $25.00-$35.00 – importance: 9% Industry Conditions Figure 3.5 Size Buying Criteria Size customers emphasize size over performance. 7 of 8 Capstone® Industry Conditions Report For C94032 Size customers prefer sensors in the 1.5 year range. 4 Projected Interest Rates Prime Interest Rate Round 1: 6.8% 8 of 8 Round: 0 Dec. 31, 2018 C94032 Andrews Wenhuan Li Shan Liu Yilin Wu Baldwin Nian Li siqi Ma Qiwen Qin Chester KUOLI LIAO chuyao tu kun yin XINGYUN ZHANG Digby Wei Duan Bowen Hu Jing Ling Erie yizhuo bi He Du YI-TING LIN LU Ma Zhengran Xu yinwan xu Ferris Selected Financial Statistics ROS Asset Turnover ROA Leverage ROE Emergency Loan Sales EBIT Profits Cumulative Profit SG&A / Sales Contrib. Margin % CAPSTONE ® COURIER Andrews 4.2% 1.05 4.4% 2.0 8.8% $0 $101,073,437 $11,996,365 $4,241,633 $4,241,633 8.9% 28.3% Baldwin 4.2% 1.05 4.4% 2.0 8.8% $0 $101,073,437 $11,996,365 $4,241,633 $4,241,633 8.9% 28.3% Chester 4.2% 1.05 4.4% 2.0 8.8% $0 $101,073,437 $11,996,365 $4,241,633 $4,241,633 8.9% 28.3% Digby 4.2% 1.05 4.4% 2.0 8.8% $0 $101,073,437 $11,996,365 $4,241,633 $4,241,633 8.9% 28.3% Erie 4.2% 1.05 4.4% 2.0 8.8% $0 $101,073,437 $11,996,365 $4,241,633 $4,241,633 8.9% 28.3% Ferris 4.2% 1.05 4.4% 2.0 8.8% $0 $101,073,437 $11,996,365 $4,241,633 $4,241,633 8.9% 28.3% Page 1 Stock & Bonds C94032 Round: 0 Dec. 31, 2018 Stock Market Summary Company Close Change Shares Andrews Baldwin Chester Digby Erie Ferris $34.36 $34.36 $34.36 $34.36 $34.36 $34.36 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 MarketCap ($M) $69 $69 $69 $69 $69 $69 Book Value EPS Dividend Yield P/E $24.00 $24.00 $24.00 $24.00 $24.00 $24.00 $2.12 $2.12 $2.12 $2.12 $2.12 $2.12 $2.00 $2.00 $2.00 $2.00 $2.00 $2.00 5.8% 5.8% 5.8% 5.8% 5.8% 5.8% 16.2 16.2 16.2 16.2 16.2 16.2 Bond Market Summary Company Andrews Series# Face Yield Close$ S&P 10.8S2020 $6,950,000 12.3S2022 $13,900,000 13.8S2024 $20,850,000 10.9% 11.9% 12.4% 99.49 103.72 111.39 B B B 10.8S2020 $6,950,000 12.3S2022 $13,900,000 13.8S2024 $20,850,000 10.9% 11.9% 12.4% 99.49 103.72 111.39 B B B 10.8S2020 $6,950,000 12.3S2022 $13,900,000 13.8S2024 $20,850,000 10.9% 11.9% 12.4% 99.49 103.72 111.39 B B B Baldwin Company Digby Series# Face Yield Close$ S&P 10.8S2020 $6,950,000 12.3S2022 $13,900,000 13.8S2024 $20,850,000 10.9% 11.9% 12.4% 99.49 103.72 111.39 B B B 10.8S2020 $6,950,000 12.3S2022 $13,900,000 13.8S2024 $20,850,000 10.9% 11.9% 12.4% 99.49 103.72 111.39 B B B 10.8S2020 $6,950,000 12.3S2022 $13,900,000 13.8S2024 $20,850,000 10.9% 11.9% 12.4% 99.49 103.72 111.39 B B B Erie Chester Ferris Next Year's Prime Rate6.80% CAPSTONE ® COURIER Page 2 Financial Summary Cash Flow Statement Survey CashFlows from operating activities Net Income(Loss) Adjustment for non-cash items: Depreciation Extraordinary gains/losses/writeoffs Changes in current assets and liablilities Accounts payable Inventory Accounts Receivable Net cash from operations C94032 Round: 0 Dec. 31, 2018 Andrews Baldwin Chester Digby Erie Ferris $4,242 $4,242 $4,242 $4,242 $4,242 $4,242 $7,587 $0 $7,587 $0 $7,587 $0 $7,587 $0 $7,587 $0 $7,587 $0 $3,583 ($8,617) ($307) $6,487 $3,583 ($8,617) ($307) $6,487 $3,583 ($8,617) ($307) $6,487 $3,583 ($8,617) ($307) $6,487 $3,583 ($8,617) ($307) $6,487 $3,583 ($8,617) ($307) $6,487 Cash flows from investing activities Plant improvements(net) Cash flows from financing activities Dividends paid Sales of common stock Purchase of common stock Cash from long term debt issued Early retirement of long term debt Retirement of current debt Cash from current debt borrowing Cash from emergency loan $0 $0 $0 $0 $0 $0 ($4,000) $0 $0 $0 $0 $0 $0 $0 ($4,000) $0 $0 $0 $0 $0 $0 $0 ($4,000) $0 $0 $0 $0 $0 $0 $0 ($4,000) $0 $0 $0 $0 $0 $0 $0 ($4,000) $0 $0 $0 $0 $0 $0 $0 ($4,000) $0 $0 $0 $0 $0 $0 $0 Net cash from financing activities ($4,000) ($4,000) ($4,000) ($4,000) ($4,000) ($4,000) Net change in cash position Balance Sheet Survey Cash Accounts Receivable Inventory Total Current Assets $2,487 Andrews $3,487 $8,307 $8,617 $20,412 $2,487 Baldwin $3,487 $8,307 $8,617 $20,412 $2,487 Chester $3,487 $8,307 $8,617 $20,412 $2,487 Digby $3,487 $8,307 $8,617 $20,412 $2,487 Erie $3,487 $8,307 $8,617 $20,412 $2,487 Ferris $3,487 $8,307 $8,617 $20,412 Plant and equipment Accumulated Depreciation Total Fixed Assets $113,800 ($37,933) $75,867 $113,800 ($37,933) $75,867 $113,800 ($37,933) $75,867 $113,800 ($37,933) $75,867 $113,800 ($37,933) $75,867 $113,800 ($37,933) $75,867 Total Assets $96,278 $96,278 $96,278 $96,278 $96,278 $96,278 Accounts Payable Current Debt Long Term Debt Total Liabilities $6,583 $0 $41,700 $48,283 $6,583 $0 $41,700 $48,283 $6,583 $0 $41,700 $48,283 $6,583 $0 $41,700 $48,283 $6,583 $0 $41,700 $48,283 $6,583 $0 $41,700 $48,283 Common Stock Retained Earnings Total Equity $18,360 $29,635 $47,995 $18,360 $29,635 $47,995 $18,360 $29,635 $47,995 $18,360 $29,635 $47,995 $18,360 $29,635 $47,995 $18,360 $29,635 $47,995 Total Liabilities & Owners Equity $96,278 $96,278 $96,278 $96,278 $96,278 $96,278 Andrews $101,073 $72,513 $7,587 $8,978 $0 $11,996 $5,338 $2,331 $87 $4,242 Baldwin $101,073 $72,513 $7,587 $8,978 $0 $11,996 $5,338 $2,331 $87 $4,242 Chester $101,073 $72,513 $7,587 $8,978 $0 $11,996 $5,338 $2,331 $87 $4,242 Digby $101,073 $72,513 $7,587 $8,978 $0 $11,996 $5,338 $2,331 $87 $4,242 Erie $101,073 $72,513 $7,587 $8,978 $0 $11,996 $5,338 $2,331 $87 $4,242 Ferris $101,073 $72,513 $7,587 $8,978 $0 $11,996 $5,338 $2,331 $87 $4,242 Income Statement Survey Sales Variable Costs(Labor,Material,Carry) Depreciation SGA(R&D,Promo,Sales,Admin) Other(Fees,Writeoffs,TQM,Bonuses) EBIT Interest(Short term,Long term) Taxes Profit Sharing Net Profit CAPSTONE ® COURIER Page 3 Price $28.00 $21.00 $38.00 $33.00 $33.00 Material Cost $11.59 $7.81 $15.98 $15.87 $13.62 Labor Cost $7.49 $7.12 $8.57 $8.57 $8.57 Contr. Marg. 29% 27% 33% 23% 30% 2nd Shift & Overtime 0% 30% 0% 0% 0% 14.9 17.4 12.4 15.9 11.4 $28.00 $21.00 $38.00 $33.00 $33.00 $11.59 $7.81 $15.98 $15.87 $13.62 $7.49 $7.12 $8.57 $8.57 $8.57 29% 27% 33% 23% 30% 0% 30% 0% 0% 0% 4.0 5.0 3.0 3.0 3.0 1,800 1,400 900 600 600 66% 129% 45% 73% 63% 4.9 2.4 7.4 8.8 3.4 14.9 17.4 12.4 15.9 11.4 $28.00 $21.00 $38.00 $33.00 $33.00 $11.59 $7.81 $15.98 $15.87 $13.62 $7.49 $7.12 $8.57 $8.57 $8.57 29% 27% 33% 23% 30% 0% 30% 0% 0% 0% 4.0 5.0 3.0 3.0 3.0 1,800 1,400 900 600 600 66% 129% 45% 73% 63% 17500 14000 23000 25000 19000 4.9 2.4 7.4 8.8 3.4 14.9 17.4 12.4 15.9 11.4 $28.00 $21.00 $38.00 $33.00 $33.00 $11.59 $7.81 $15.98 $15.87 $13.62 $7.49 $7.12 $8.57 $8.57 $8.57 29% 27% 33% 23% 30% 0% 30% 0% 0% 0% 4.0 5.0 3.0 3.0 3.0 1,800 1,400 900 600 600 66% 129% 45% 73% 63% 3.1 4.6 1.7 2.5 2.6 17500 14000 23000 25000 19000 4.9 2.4 7.4 8.8 3.4 14.9 17.4 12.4 15.9 11.4 $28.00 $21.00 $38.00 $33.00 $33.00 $11.59 $7.81 $15.98 $15.87 $13.62 $7.49 $7.12 $8.57 $8.57 $8.57 29% 27% 33% 23% 30% 0% 30% 0% 0% 0% 4.0 5.0 3.0 3.0 3.0 1,800 1,400 900 600 600 66% 129% 45% 73% 63% 3.1 4.6 1.7 2.5 2.6 17500 14000 23000 25000 19000 4.9 2.4 7.4 8.8 3.4 14.9 17.4 12.4 15.9 11.4 $28.00 $21.00 $38.00 $33.00 $33.00 $11.59 $7.81 $15.98 $15.87 $13.62 $7.49 $7.12 $8.57 $8.57 $8.57 29% 27% 33% 23% 30% 0% 30% 0% 0% 0% 4.0 5.0 3.0 3.0 3.0 1,800 1,400 900 600 600 66% 129% 45% 73% 63% Unit Inven Revision Age tory Date Dec.31 189 11/21/2015 3.1 39 5/25/2014 4.6 40 4/19/2017 1.7 78 6/29/2016 2.5 62 5/24/2016 2.6 Name Able Acre Adam Aft Agape Primary Segment Trad Low High Pfmn Size Units Sold 999 1,763 366 358 314 Baker Bead Bid Bold Buddy Trad Low High Pfmn Size 999 1,763 366 358 314 189 11/21/2015 39 5/25/2014 40 4/19/2017 78 6/29/2016 62 5/24/2016 Cake Cedar Cid Coat Cure Trad Low High Pfmn Size 999 1,763 366 358 314 Daze Dell Dixie Dot Dune Trad Low High Pfmn Size Eat Ebb Echo Edge Egg Fast Feat Fist Foam Fume MTBF 17500 14000 23000 25000 19000 Pfmn Coord 4.9 2.4 7.4 8.8 3.4 Size Coord 14.9 17.4 12.4 15.9 11.4 3.1 4.6 1.7 2.5 2.6 17500 14000 23000 25000 19000 4.9 2.4 7.4 8.8 3.4 189 11/21/2015 39 5/25/2014 40 4/19/2017 78 6/29/2016 62 5/24/2016 3.1 4.6 1.7 2.5 2.6 17500 14000 23000 25000 19000 999 1,763 366 358 314 189 11/21/2015 39 5/25/2014 40 4/19/2017 78 6/29/2016 62 5/24/2016 3.1 4.6 1.7 2.5 2.6 Trad Low High Pfmn Size 999 1,763 366 358 314 189 11/21/2015 39 5/25/2014 40 4/19/2017 78 6/29/2016 62 5/24/2016 Trad Low High Pfmn Size 999 1,763 366 358 314 189 11/21/2015 39 5/25/2014 40 4/19/2017 78 6/29/2016 62 5/24/2016 CAPSTONE ® COURIER Round: 0 Dec. 31, 2018 C94032 Production Analysis Auto mation Next Round 4.0 5.0 3.0 3.0 3.0 Capacity Next Round 1,800 1,400 900 600 600 Plant Utiliz. 66% 129% 45% 73% 63% Page 4 Traditional Segment Analysis C94032 Round: 0 Dec. 31, 2018 Traditional Statistics Total Industry Unit Demand Actual Industry Unit Sales Segment % of Total Industry 7,387 |7,387 |32.4% Next Year's Segment Growth Rate |7.0% Traditional Customer Buying Criteria Expectations Ideal Age = 2.0 $20.00 - 30.00 Pfmn 4.4 Size 15.4 MTBF 14000-19000 1. Age 2. Price 3. Ideal Position 4. Reliability Importance 47% 23% 21% 9% Top Products in Traditional Segment Name Able Baker Cake Daze Eat Fast Acre Bead Cedar Dell Ebb Feat Market Share 13% 13% 13% 13% 13% 13% 4% 4% 4% 4% 4% 4% Units Sold to Seg 961 961 961 961 961 961 270 270 270 270 270 270 CAPSTONE ® COURIER Revision Date 11/21/2015 11/21/2015 11/21/2015 11/21/2015 11/21/2015 11/21/2015 5/25/2014 5/25/2014 5/25/2014 5/25/2014 5/25/2014 5/25/2014 Stock Out Pfmn Coord 4.9 4.9 4.9 4.9 4.9 4.9 2.4 2.4 2.4 2.4 2.4 2.4 Size Coord 14.9 14.9 14.9 14.9 14.9 14.9 17.4 17.4 17.4 17.4 17.4 17.4 List Price $28.00 $28.00 $28.00 $28.00 $28.00 $28.00 $21.00 $21.00 $21.00 $21.00 $21.00 $21.00 MTBF 17500 17500 17500 17500 17500 17500 14000 14000 14000 14000 14000 14000 Cust. Age Promo AwareDec.31 Budget ness 3.10 $1,000 55% 3.10 $1,000 55% 3.10 $1,000 55% 3.10 $1,000 55% 3.10 $1,000 55% 3.10 $1,000 55% 4.60 $900 52% 4.60 $900 52% 4.60 $900 52% 4.60 $900 52% 4.60 $900 52% 4.60 $900 52% Cust. Dec. Sales Access- Cust Budget ibility Survey $1,000 54% 18 $1,000 54% 18 $1,000 54% 18 $1,000 54% 18 $1,000 54% 18 $1,000 54% 18 $900 54% 4 $900 54% 4 $900 54% 4 $900 54% 4 $900 54% 4 $900 54% 4 Page 5 Low End Segment Analysis C94032 Round: 0 Dec. 31, 2018 Low End Statistics Total Industry Unit Demand Actual Industry Unit Sales Segment % of Total Industry 8,960 |8,960 |39.3% Next Year's Segment Growth Rate |14.4% Low End Customer Buying Criteria Expectations $15.00 - 25.00 Ideal Age = 7.0 Pfmn 1.1 Size 18.7 MTBF 12000-17000 1. Price 2. Age 3. Ideal Position 4. Reliability Importance 53% 24% 16% 7% Top Products in Low End Segment Name Acre Bead Cedar Dell Ebb Feat Market Share 17% 17% 17% 17% 17% 17% Units Sold to Seg 1,493 1,493 1,493 1,493 1,493 1,493 CAPSTONE ® COURIER Revision Date 5/25/2014 5/25/2014 5/25/2014 5/25/2014 5/25/2014 5/25/2014 Stock Out Pfmn Coord 2.4 2.4 2.4 2.4 2.4 2.4 Size Coord 17.4 17.4 17.4 17.4 17.4 17.4 List Price $21.00 $21.00 $21.00 $21.00 $21.00 $21.00 MTBF 14000 14000 14000 14000 14000 14000 Cust. Age Promo AwareDec.31 Budget ness 4.60 $900 52% 4.60 $900 52% 4.60 $900 52% 4.60 $900 52% 4.60 $900 52% 4.60 $900 52% Cust. Dec. Sales Access- Cust Budget ibility Survey $900 40% 12 $900 40% 12 $900 40% 12 $900 40% 12 $900 40% 12 $900 40% 12 Page 6 High End Segment Analysis C94032 Round: 0 Dec. 31, 2018 High End Statistics Total Industry Unit Demand Actual Industry Unit Sales Segment % of Total Industry 2,554 |2,554 |11.2% Next Year's Segment Growth Rate |21.0% High End Customer Buying Criteria Expectations Pfmn 8.3 Size 11.5 Ideal Age = 0.0 MTBF 20000-25000 $30.00 - 40.00 1. Ideal Position 2. Age 3. Reliability 4. Price Importance 43% 29% 19% 9% Top Products in High End Segment Name Adam Bid Cid Dixie Echo Fist Aft Bold Coat Dot Edge Foam Market Share 14% 14% 14% 14% 14% 14% 2% 2% 2% 2% 2% 2% Units Sold to Seg 366 366 366 366 366 366 41 41 41 41 41 41 CAPSTONE ® COURIER Revision Date 4/19/2017 4/19/2017 4/19/2017 4/19/2017 4/19/2017 4/19/2017 6/29/2016 6/29/2016 6/29/2016 6/29/2016 6/29/2016 6/29/2016 Stock Out Pfmn Coord 7.4 7.4 7.4 7.4 7.4 7.4 8.8 8.8 8.8 8.8 8.8 8.8 Size Coord 12.4 12.4 12.4 12.4 12.4 12.4 15.9 15.9 15.9 15.9 15.9 15.9 List Price $38.00 $38.00 $38.00 $38.00 $38.00 $38.00 $33.00 $33.00 $33.00 $33.00 $33.00 $33.00 MTBF 23000 23000 23000 23000 23000 23000 25000 25000 25000 25000 25000 25000 Cust. Age Promo AwareDec.31 Budget ness 1.70 $800 49% 1.70 $800 49% 1.70 $800 49% 1.70 $800 49% 1.70 $800 49% 1.70 $800 49% 2.50 $700 46% 2.50 $700 46% 2.50 $700 46% 2.50 $700 46% 2.50 $700 46% 2.50 $700 46% Cust. Dec. Sales Access- Cust Budget ibility Survey $800 48% 21 $800 48% 21 $800 48% 21 $800 48% 21 $800 48% 21 $800 48% 21 $700 48% 2 $700 48% 2 $700 48% 2 $700 48% 2 $700 48% 2 $700 48% 2 Page 7 Performance Segment Analysis C94032 Round: 0 Dec. 31, 2018 Performance Statistics Total Industry Unit Demand Actual Industry Unit Sales Segment % of Total Industry 1,915 |1,915 |8.4% Next Year's Segment Growth Rate |17.6% Performance Customer Buying Criteria Expectations MTBF 22000-27000 Pfmn 8.8 Size 16.4 $25.00 - 35.00 Ideal Age = 1.0 1. Reliability 2. Ideal Position 3. Price 4. Age Importance 43% 29% 19% 9% Top Products in Performance Segment Name Aft Bold Coat Dot Edge Foam Able Baker Cake Daze Eat Fast Market Share 17% 17% 17% 17% 17% 17% 0% 0% 0% 0% 0% 0% Units Sold to Seg 317 317 317 317 317 317 2 2 2 2 2 2 CAPSTONE ® COURIER Revision Date 6/29/2016 6/29/2016 6/29/2016 6/29/2016 6/29/2016 6/29/2016 11/21/2015 11/21/2015 11/21/2015 11/21/2015 11/21/2015 11/21/2015 Stock Out Pfmn Coord 8.8 8.8 8.8 8.8 8.8 8.8 4.9 4.9 4.9 4.9 4.9 4.9 Size Coord 15.9 15.9 15.9 15.9 15.9 15.9 14.9 14.9 14.9 14.9 14.9 14.9 List Price $33.00 $33.00 $33.00 $33.00 $33.00 $33.00 $28.00 $28.00 $28.00 $28.00 $28.00 $28.00 MTBF 25000 25000 25000 25000 25000 25000 17500 17500 17500 17500 17500 17500 Cust. Age Promo AwareDec.31 Budget ness 2.50 $700 46% 2.50 $700 46% 2.50 $700 46% 2.50 $700 46% 2.50 $700 46% 2.50 $700 46% 3.10 $1,000 55% 3.10 $1,000 55% 3.10 $1,000 55% 3.10 $1,000 55% 3.10 $1,000 55% 3.10 $1,000 55% Cust. Dec. Sales Access- Cust Budget ibility Survey $700 37% 20 $700 37% 20 $700 37% 20 $700 37% 20 $700 37% 20 $700 37% 20 $1,000 37% 0 $1,000 37% 0 $1,000 37% 0 $1,000 37% 0 $1,000 37% 0 $1,000 37% 0 Page 8 Size Segment Analysis C94032 Round: 0 Dec. 31, 2018 Size Statistics Total Industry Unit Demand Actual Industry Unit Sales Segment % of Total Industry 1,984 |1,984 |8.7% Next Year's Segment Growth Rate |16.5% Size Customer Buying Criteria Expectations Pfmn 3.4 Size 11.0 Ideal Age = 1.5 MTBF 16000-21000 $25.00 - 35.00 1. Ideal Position 2. Age 3. Reliability 4. Price Importance 43% 29% 19% 9% Top Products in Size Segment Name Agape Buddy Cure Dune Egg Fume Able Baker Cake Daze Eat Fast Market Share 15% 15% 15% 15% 15% 15% 1% 1% 1% 1% 1% 1% Units Sold to Seg 307 307 307 307 307 307 24 24 24 24 24 24 CAPSTONE ® COURIER Revision Date 5/24/2016 5/24/2016 5/24/2016 5/24/2016 5/24/2016 5/24/2016 11/21/2015 11/21/2015 11/21/2015 11/21/2015 11/21/2015 11/21/2015 Stock Out Pfmn Coord 3.4 3.4 3.4 3.4 3.4 3.4 4.9 4.9 4.9 4.9 4.9 4.9 Size Coord 11.4 11.4 11.4 11.4 11.4 11.4 14.9 14.9 14.9 14.9 14.9 14.9 List Price $33.00 $33.00 $33.00 $33.00 $33.00 $33.00 $28.00 $28.00 $28.00 $28.00 $28.00 $28.00 MTBF 19000 19000 19000 19000 19000 19000 17500 17500 17500 17500 17500 17500 Cust. Age Promo AwareDec.31 Budget ness 2.60 $700 46% 2.60 $700 46% 2.60 $700 46% 2.60 $700 46% 2.60 $700 46% 2.60 $700 46% 3.10 $1,000 55% 3.10 $1,000 55% 3.10 $1,000 55% 3.10 $1,000 55% 3.10 $1,000 55% 3.10 $1,000 55% Cust. Dec. Sales Access- Cust Budget ibility Survey $700 42% 27 $700 42% 27 $700 42% 27 $700 42% 27 $700 42% 27 $700 42% 27 $1,000 42% 2 $1,000 42% 2 $1,000 42% 2 $1,000 42% 2 $1,000 42% 2 $1,000 42% 2 Page 9 Market Share Actual Market Share in Units Trad 7,387 32.4% Low 8,960 39.3% Able Acre Adam Aft Agape Total 13.0% 3.6% 16.7% 16.7% 16.7% Baker Bead Bid Bold Buddy Total 13.0% 3.6% 16.7% 16.7% 16.7% Cake Cedar Cid Coat Cure Total 13.0% 3.6% 16.7% 16.7% 16.7% Daze Dell Dixie Dot Dune Total 13.0% 3.6% 16.7% 16.7% 16.7% Eat Ebb Echo Edge Egg Total 13.0% 3.6% 16.7% 16.7% 16.7% Fast Feat Fist Foam Fume Total 13.0% 3.6% 16.7% Industry Unit Sales % of Market 16.7% CAPSTONE ® COURIER Round: 0 Dec. 31, 2018 C94032 High 2,554 11.2% Pfmn 1,915 8.4% Size 1,984 8.7% 0.4% 0.1% 1.2% 14.3% 1.6% 0.3% 16.7% 0.4% 14.3% 1.6% 0.3% 16.7% 0.4% 14.3% 1.6% 0.3% 16.7% 0.4% 14.3% 1.6% 0.3% 16.7% 0.4% 14.3% 1.6% 0.3% 16.7% 0.4% 16.7% 14.3% 1.6% 0.3% 16.7% 16.5% 16.7% 15.5% 16.7% 0.1% 1.2% 16.5% 16.7% 15.5% 16.7% 0.1% 1.2% 16.5% 16.7% 15.5% 16.7% 0.1% 1.2% 16.5% 16.7% 15.5% 16.7% 0.1% 1.2% 16.5% 16.7% 15.5% 16.7% 0.1% 1.2% 16.5% 16.7% 15.5% 16.7% Potential Market Share in Units Total 22,800 Units Demanded 100.0% % of Market Trad 7,387 32.4% Low 8,960 39.3% 16.7% 4.4% 7.7% 1.6% 1.6% 1.4% 16.7% Able Acre Adam Aft Agape Total 13.0% 3.7% 16.7% 16.7% 4.4% 7.7% 1.6% 1.6% 1.4% 16.7% Baker Bead Bid Bold Buddy Total 13.0% 3.7% 16.7% 16.7% 16.7% 4.4% 7.7% 1.6% 1.6% 1.4% 16.7% Cake Cedar Cid Coat Cure Total 13.0% 3.7% 16.7% 16.7% 16.7% 4.4% 7.7% 1.6% 1.6% 1.4% 16.7% Daze Dell Dixie Dot Dune Total 13.0% 3.7% 16.7% 16.7% 16.7% 4.4% 7.7% 1.6% 1.6% 1.4% 16.7% Eat Ebb Echo Edge Egg Total 13.0% 3.7% 16.7% 16.7% 16.7% 4.4% 7.7% 1.6% 1.6% 1.4% 16.7% Fast Feat Fist Foam Fume Total 13.0% 3.7% 16.7% 16.7% High 2,554 11.2% Pfmn 1,915 8.4% 0.5% 14.3% 1.6% 0.3% 16.7% 16.7% 16.7% 16.7% 15.5% 16.7% 16.5% 16.7% 15.5% 16.7% 1.2% 16.5% 16.7% 15.5% 16.7% 1.2% 16.5% 16.7% 0.5% 14.3% 1.6% 0.3% 16.7% 15.5% 16.7% 1.2% 0.5% 14.3% 1.6% 0.3% 16.7% 4.4% 7.7% 1.6% 1.6% 1.4% 16.7% 16.5% 0.5% 14.3% 1.6% 0.3% 16.7% 1.2% 1.2% 0.5% 14.3% 1.6% 0.3% 16.7% Total 22,800 100.0% 16.5% 0.5% 14.3% 1.6% 0.3% 16.7% Size 1,984 8.7% 15.5% 16.7% 1.2% 16.5% 16.7% 15.5% 16.7% 4.4% 7.7% 1.6% 1.6% 1.4% 16.7% 4.4% 7.7% 1.6% 1.6% 1.4% 16.7% 4.4% 7.7% 1.6% 1.6% 1.4% 16.7% 4.4% 7.7% 1.6% 1.6% 1.4% 16.7% 4.4% 7.7% 1.6% 1.6% 1.4% 16.7% Page 10 Perceptual Map Andrews Name Able Acre Adam Aft Agape Pfmn 4.9 2.4 7.4 8.8 3.4 Name Daze Dell Dixie Dot Dune Pfmn 4.9 2.4 7.4 8.8 3.4 Size 14.9 17.4 12.4 15.9 11.4 Digby CAPSTONE ® COURIER Size 14.9 17.4 12.4 15.9 11.4 Round: 0 Dec. 31, 2018 C94032 Baldwin Revised 11/21/2015 5/25/2014 4/19/2017 6/29/2016 5/24/2016 Name Baker Bead Bid Bold Buddy Pfmn 4.9 2.4 7.4 8.8 3.4 Revised 11/21/2015 5/25/2014 4/19/2017 6/29/2016 5/24/2016 Name Eat Ebb Echo Edge Egg Pfmn 4.9 2.4 7.4 8.8 3.4 Size 14.9 17.4 12.4 15.9 11.4 Erie Size 14.9 17.4 12.4 15.9 11.4 Chester Revised 11/21/2015 5/25/2014 4/19/2017 6/29/2016 5/24/2016 Name Cake Cedar Cid Coat Cure Pfmn 4.9 2.4 7.4 8.8 3.4 Revised 11/21/2015 5/25/2014 4/19/2017 6/29/2016 5/24/2016 Name Fast Feat Fist Foam Fume Pfmn 4.9 2.4 7.4 8.8 3.4 Size 14.9 17.4 12.4 15.9 11.4 Ferris Size 14.9 17.4 12.4 15.9 11.4 Revised 11/21/2015 5/25/2014 4/19/2017 6/29/2016 5/24/2016 Revised 11/21/2015 5/25/2014 4/19/2017 6/29/2016 5/24/2016 Page 11 HR/TQM Report C94032 Round: 0 Dec. 31, 2018 HUMAN RESOURCES SUMMARY Needed Complement Complement 1st Shift Complement 2nd Shift Complement Andrews 701 700 640 60 Baldwin 701 700 640 60 Chester 701 700 640 60 Digby 701 700 640 60 Erie 701 700 640 60 Ferris 701 700 640 60 Overtime Percent Turnover Rate New Employees Separated Employees Recruiting Spend Training Hours Productivity Index 0.2% 10.0% 70 0 $0 0 100.0% 0.2% 10.0% 70 0 $0 0 100.0% 0.2% 10.0% 70 0 $0 0 100.0% 0.2% 10.0% 70 0 $0 0 100.0% 0.2% 10.0% 70 0 $0 0 100.0% 0.2% 10.0% 70 0 $0 0 100.0% $70 $0 $0 $70 $70 $0 $0 $70 $70 $0 $0 $70 $70 $0 $0 $70 $70 $0 $0 $70 $70 $0 $0 $70 $21.00 2,500 2.0% 5.0% $21.00 2,500 2.0% 5.0% $21.00 2,500 2.0% 5.0% $21.00 2,500 2.0% 5.0% $21.00 2,500 2.0% 5.0% $21.00 2,500 2.0% 5.0% Baldwin Chester Digby Erie Ferris Recruiting Cost Separation Cost Training Cost Total HR Admin Cost Labor Contract Next Year Wages Benefits Profit Sharing Annual Raise Starting Negotiation Position Wages Benefits Profit Sharing Annual Raise Ceiling Negotiation Position Wages Benefits Profit Sharing Annual Raise Adjusted Labor Demands Wages Benefits Profit Sharing Annual Raise Strike Days TQM SUMMARY Andrews Process Mgt Budgets Last Year CPI Systems VendorJIT Quality Initiative Training Channel Support Systems Concurrent Engineering UNEP Green Programs $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 TQM Budgets Last Year Benchmarking Quality Function Deployment Effort CCE/6 Sigma Training GEMI TQEM Sustainability Initiatives Total Expenditures $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% Cumulative Impacts Material Cost Reduction Labor Cost Reduction Reduction R&D Cycle Time Reduction Admin Costs Demand Increase CAPSTONE ® COURIER Page 12 Annual Report Annual Report Chester C94032 Balance Sheet DEFINITIONS: Common Size: The common size column simply represents each item as a percentage of total assets for that year. Cash: Your end-of-year cash position. Accounts Receivable: Reflects the lag between delivery and payment of your products. Inventories: The current value of your inventory across all products. A zero indicates your company stocked out. Unmet demand would, of course, fall to your competitors. Plant & Equipment: The current value of your plant. Accum Deprec: The total accumulated depreciation from your plant. Accts Payable: What the company currently owes suppliers for materials and services. Current Debt: The debt the company is obligated to pay during the next year of operations. It includes emergency loans used to keep your company solvent should you run out of cash during the year. Long Term Debt: The companys long term debt is in the form of bonds, and this represents the total value of your bonds. Common Stock: The amount of capital invested by shareholders in the company. Retained Earnings: The profits that the company chose to keep instead of paying to shareholders as dividends. ASSETS Cash Account Receivable Inventory Total Current Assets $3,487 $8,307 $8,617 $20,411 Plant & Equipment Accumulated Depreciation Total Fixed Assets Total Assets LIABILITIES & OWNERS EQUITY $113,800 ($37,933) $75,867 $96,278 Accounts Payable Current Debt Long Term Debt Total Liabilities $6,583 $0 $41,700 Common Stock Retained Earnings Total Equity Total Liab. & O. Equity $18,360 $29,635 $48,283 Cash Flow Statement The Cash Flow Statement examines what happened in the Cash Account during the year. Cash injections appear as positive numbers and cash withdrawals as negative numbers. The Cash Flow Statement is an excellent tool for diagnosing emergency loans. When negative cash flows exceed positives, you are forced to seek emergency funding. For example, if sales are bad and you find yourself carrying an abundance of excess inventory, the report would show the increase in inventory as a huge negative cash flow. Too much unexpected inventory could outstrip your inflows, exhaust your starting cash and force you to beg for money to keep your company afloat. Annual Report Round: 0 Dec. 31, 2018 Cash Flows from Operating Activities Net Income(Loss) Depreciation Extraordinary gains/losses/writeoffs Accounts Payable Inventory Accounts Receivable Net cash from operation Cash Flows from Investing Activities Plant Improvements Cash Flows from Financing Activities Dividends paid Sales of common stock Purchase of common stock Cash from long term debt Retirement of long term debt Change in current debt(net) Net cash from financing activities Net change in cash position Closing cash position $47,995 $96,278 2018 $4,242 $7,587 $0 $3,583 ($8,617) ($307) $6,487 $0 ($4,000) $0 $0 $0 $0 $0 ($4,000) $2,487 $3,487 Page 13 Annual Report Chester Round: 0 Dec. 31, 2018 C94032 2018 Income Statement (Product Name) $0 2018 Total $101,073 Common Size 100.0% $0 $0 $0 $0 $0 $0 $0 $0 $28,932 $42,546 $1,034 $72,513 28.6% 42.1% 1.0% 71.7% $0 $0 $0 $28,561 28.3% $720 $0 $700 $700 $80 $2,200 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $7,587 $0 $4,100 $4,100 $778 $16,564 7.5% 0.0% 4.1% 4.1% 0.8% 16.4% $899 $0 $0 $0 $11,996 11.9% $0 $11,996 $0 $5,338 $2,331 $87 $4,242 0.0% 11.9% 0.0% 5.3% 2.3% 0.1% 4.2% Cake Cedar Cid Coat Cure Sales $27,979 $37,027 $13,894 $11,817 $10,356 $0 $0 Variable Costs: Direct Labor Direct Material Inventory Carry Total Variable $7,489 $11,967 $441 $19,897 $12,557 $14,348 $71 $26,977 $3,132 $6,001 $121 $9,254 $3,067 $5,829 $231 $9,127 $2,688 $4,401 $169 $7,258 $0 $0 $0 $0 Contribution Margin $8,082 $10,051 $4,640 $2,689 $3,099 Period Costs: Depreciation SG&A: R&D Promotions Sales Admin Total Period $2,640 $0 $1,000 $1,000 $215 $4,855 $2,427 $0 $900 $900 $285 $4,512 $1,080 $0 $800 $800 $107 $2,787 $720 $0 $700 $700 $91 $2,211 Net Margin $3,227 $5,539 $1,853 $478 Definitions: Sales: Unit Sales times list price. Direct Labor: Labor costs incurred to produce the product that was sold. Inventory Carry Cost: the cost unsold goods in inventory. Depreciation: Calculated on straight-line. 15-year depreciation of plant value. R&D Costs: R&D department expenditures for each product. Admin: Administration overhead is estimated at 1.5% of sales. Promotions: The promotion budget for each product. Sales: The sales force budget for each product. Other: Chargs not included in other categories such as Fees, Write offs, and TQM. The fees include money paid to investment bankers and brokerage firms to issue new stocks or bonds plus consulting fees your instructor might assess. Write-offs include the loss you might experience when you sell capacity or liquidate inventory as the result of eliminating a production line. If the amount appears as a negative amount, then you actually made money on the liquidation of capacity or inventory. EBIT: Earnings Before Interest and Taxes. Short Term Interest: Interest expense based on last years current debt, including short term debt, long term notes that have become due, and emergency loans, Long Term Interest: Interest paid on outstanding bonds. Taxes: Income tax based upon a 35% tax rate. Profit Sharing: Profits shared with employees under the labor contract. Net Profit: EBIT minus interest, taxes, and profit sharing. Annual Report Other EBIT Short Term Interest Long Term Interest Taxes Profit Sharing Net Profit Page 14 Perceptual Map - Information What is the Perceptual Map? The perceptual map is a visual representation of the five different customer segments based on how specialized these customers want their product to be. For example, some customers want higher performance and smaller size than other customers, so they are grouped in a segment called the 'High End'. Other customers don't mind about the size but want really good performance, so they are grouped in a segment called 'Performance', and so on. Just like in real life, over time all customers' expectations move toward better products, which in the simulation means smaller and higher performance. The animation below shows the moving expectations of customers, called 'Segment Drift': 20 Stop Start 18 Segment Positions at the End of Round: 0 1 2 3 4 5 6 7 8 16 14 Low End Click the Round Numbers above to Freeze the Animation 12 For a deeper look into the Perceptual Map click here to view a description in the online guide. Performance Size 10 Traditional) 8 The magenta dots within each segment represent Ideal Spots, the location customers prefer. Ideal Spots drift with the segments. For more details about the drift rates in the perceptual map, please refer to the section titled 'Drift Rates' in the Industry Conditions Report. 6 High End 4. Size 2 0 0 8 16 18 20 2 4 6 Performance 10 12 14 Perceptual Map How can I use the Perceptual Map? How can I use the Perceptual Map? The Research & Development Department can use the Perceptual Map exercise to plan revision and invention projects that meet customers shifting size and performance expectations. The Marketing Department can use the results during forecasting as they compare competing products and when determining prices (in general, better positioned products can command higher prices). Previous Next Perceptual Map - Ideal Spots The Ideal Spot in the Segment Circles Ideal Spots offset from segment center 20 So, where should you try to position your product in the segment circles? As a basic rule, the 'Ideal Spot' will help guide you. The ideal spot represents the position with the highest point of demand for each consumer base or segment. 18 16 14 Low End 12 Size Performance Traditional 10 The ideal spot is made up by the product's performance (speed) and size. As the perceptual map drifts down and to the right each year, the ideal spot will change as customers demand sensors with decreased size (smaller) and increased performance (faster). Although it would seem that the Ideal Spot would be in the center of the segment circle, the positioning actually varies due to the customer focus of each segment. For example, in the High End segment, the Ideal Spot is at the leading edge of the segment because those customers want the best possible product. Each segment's ideal spot is represented by the pink dots on the Perceptual Map. 8 6 High End) 4 Size 2 07 0 2 4 6 8 10 12 14 16 18 20
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