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?”
