09 May HOW MANY SHOE STYLES SHOULD JTI PRODUCE FOR NEXT YEAR?
value chain functions Scenario: You have been hired as a consultant for JetSet Travel Inc. (JTI) a company which develops manufactures and sells a wide range of travel-related equipment and products. The company expanded its luggage production this year and invested much of its manufacturing funds into the initial manufacture of a lightweight yet durable line of luggage. JetSet Travel put many of its research development and marketing dollars this year into a breakthrough over- the-counter tablet which prevents jet lag for 98% of adult users. You were hired to provide the analysis and advice which will help the upper level management make critical decisions to reduce costs and increase profit. In the following months you will use your accounting skills to assist company leaders by projecting profits focusing product lines providing capital budgeting analysis and making recommendations for containing costs. PROBLEM: JetSet Travel Inc. (JTI) has been hugely successful in the distribution of stylish comfortable shoes for travel. JTI sells its products to approximately 4000 retail accounts in the United States and a mix of independent distributors licenses and subsidiaries in 35 countries around the world. Most footwear products are produced outside the United States. Identify one decision that JTI managers must make in each of the six value chain functions for this product. For each decision identify one piece of accounting information that would aid the manager’s decision. Next write 5 questions that can be answered by accounting information. For example “How many shoe styles should JTI produce for next year?” or “Where are the sales trends declining?”
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