 BM-X Mike’s Bikes Simulation Keenen Moreira-Lima Wade Bordian Reece Cain Carla Sutton

Firm Overview  Financial Results: Sales: $12,300,000 Units Sold: 20,000 Profit (after tax): $978,538 Share Holder Value: $10.94 Earnings per Share: $0.979  Costs: Cost of each Bike: $ Cost of goods sold: $3,763,000 Selling and Distribution Expenses: $2,755,140  Marketing Strategy: High Price, Low Volume  Overall Strategy: High Quality High Distribution and branding in sports stores High Marketing

Price: Retail Price -Price increased by 11% ($550-$610) from 2010 to Price increased by 1% ($610-$615) from Price remains the highest in the industry at $615, higher than industry average of $554 Retail Price 2012%2011%2010Target $615 1% $610 11% $550 $599 13% $530 -4% $550 $525 5% $500 -9% $550 $490 9% $ % $550 0% $550 0% $550 0% $550 0% $550 0% $550 0% $550 $554 5% $530 -4% $550

Public Relations Rating PR Rating Firm2012%2011%2010Target % % 0.16 BM-X % % 0.16 Hot Wheels % % 0.16 MikeBikes % % 0.16 Sharpe Cycles % % 0.16 Firm % % 0.16 Firm % % 0.16 Firm % %  BM-X’s PR has decreased significantly over the past two years  Dropping 31% in 2011 and another 27% in 2012  An industry average of 0.13 BM-X is down 0.05 points  This is due to a high marketing strategy and low PR priority

Place  1) your firm’s previous results (e.g. price increased by 20% from $550 per bike to $660)  2) the competition (e.g. price remains the highest in the industry and $50 above the next highest price)  3) industry averages (e.g. the price of $660 is $80 above the industry average price of $580)  4) targets if applicable (e.g. the price of $660 is $60 above the suggested premium price strategy of $600)  5) describe how it (price, promotion or place) is related to sales (e.g. our pricing strategy appears to have a strong, negative correlation to unit sales, that as price rises our unit sales decrease from 20,000 units to 17, 500, especially in comparison)

General Conclusion  Look at the big picture of your firm’s sales performance and based on your analysis, identify the key reasons for your sales.

…  You should prepare a marketing analysis report and have these statements on hand:  Income Statement history with horizontal analysis  Market Summary (All Product Details Report) history including competitor results and incorporating selected consumer information from the Market Research report including target ratings  Selected competitive information from Industry Benchmark Report including relevant industry averages

Q & A Period  Are there any questions?