Case analysis (fabrics and fall fashion)

Subject: Customer Relationship Management

Paper Model: APA

Paper Type: Case Study

Total Words: 608

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Total labor and machine cost for production of 6000 velvet shirts is 96000. Yard is required for its production


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Total labor and machine cost for production of 6000 velvet shirts is 96000. Yard is required for its production. Total cost of yard is $6018. As, 1.5 yard of velvet is required for producing one-yard shirt. Sales Price of velvet shirt is 200 each. Its total cost of production is $102018. Selling price for 6000 shirts is $1200000. Total profit from its sale is hence $17982. This is small amount. For setting July production, fixed fashion and design cost should not be included. This product has positive contribution for adjusting sunk cost. According to model of linear programming, these should be prepared for consideration of production. These questions should be concerned before making decision of fixed costs. With demand of 6000 and contribution of $22, maximum profit that is expected would be $132000. It will not cover direct cost that is $500,000. That is the reason that it would not be idea to carry on this production in plan.

b.

 After analysis, it is concluded that simplifying process of production would result in identifying process of independent production

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