Minh Long Co. Ltd. Collection Items
It is January 2012, and Ly Ngoc Minh, CEO of the porcelain manufacturing company, Minh Long I, has to make a decision about the collection item product line. The collection is a beautiful line of products. No other piece of dinnerware or figurines made at his factory could better communicate the quality of Minh Long’s porcelain. Whether he should expand production in this area is a question that needs to be answered. Minh wonders if an investment to expand the talent- base that crafts this collection would be worth it, and how this would change his business. While he recognises that each piece contributes to the name and reputation of the company, he must also consider the full costs of training, developing and potentially losing talented artists.
Through this case, students will get an opportunity to understand variable and fixed costs as they relate to a major business decision. They will learn about concepts such as sensitivity analyses and full profitability analyses on a new business line. They will gain an understanding of human resource investment and revenue, and the difference between a short-term and a long-term break-even.
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