Ten Alpina Tools

Giulia seems to be excited almost the opportunity to own her own affair doing something that she loves. T present is a lavishly level of uncertainty here in whether or non Giulia would consume a profit commensurate t get hold of. It seems that there is room for improvement in the accepted operations since whole 6 workers were cross trained and they were currently tho busy for about one weeks worth of labor succession per month. Giulia does nourish an MBA and may be able to recognize ways to use the resources much efficiently and keep production costs ingest. Giulia go away need to dress her strategic thinking to determine how to balance the resources on hand to key this situation work. If she can offer the units for $11.70 or higher, she may be able to maintain the business but she leave need to drive down the production costs to sustain profits. If any equipment needs repairs or the expression needs renovations, those costs are non going to be turn under her cu rrent pricing plan. Also, if production increases, variable costs may also increase so it will be important for Giulia to commit close attention to this.After reading the case we identified the following ventures1) down School/ MBA The case takes place as Giulia is returning from summer chip off after her first year. Given the intense work load of an MBA course and the workload requirements of a startup/expansion, we begin to question if she can do both effectively. Quantitative Analysis LOW. This is more of a time and lifestyle concern.2) Loss of the single customer contract alltime a business is relying on a single customer its a risk. Giulia is apply the currency menstruum from this customer to support the new venture. There is not a strong history here for her to count on and deficiency of data increases risk. In addition she also is highly at risk should her customer go out of business or find another(prenominal) supplier she would be hard pressed to meet her monthly take fire rate.In fact there is no show in the case that her business could survive without that contract. Quantitative Analysis HIGH.. The key issue here is that the business is running on actually thin margins and the cash bleed from this customer is critical for Giulia to cover her fixed and variable costs. There is no evidence that she has cash reserves or any access to investors.3) Employee/operations issues Giulia has no experience in this industry and we have no evidence that she has ever managed people or managed a manufacturing process. Due to her thin margins any interruption in production would be devastating. Quality is a considerable concern here and although her team is cross trained on all the equipment its reasonable to assume that there will be employee turnover.She will need to replace them and we dont know what they training regular recurrence is and how it will impactproduction and quality. Qualitative Analysis HIGH achievement ties directly to the abilit y to fulfill the contract. This contract is key to her cash flow and the margins are small. Giulia needs to determine the new employee training cycle and factor out that into production and cash flow projections.4) Increased Costs If Giulia experiences an increase in production or fixed costs she is in a very risky situation. Her margins are thin and we have no evidence of cash reserves. Qualitative Analysis HIGH.. Any increase to costs cuts into margins. Giulia is not in a position to handle such increases.5) Re dialog or delays on the single contract The single customer could ask for a lower price point, lower volume or move to renegotiate payment terms. Qualitative Analysis HIGH.. As we have seen a key concern in this case are the margins. Any decrease in price or payment schedule will have a direct impact on Giulias ability to cover her costs