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Dr. Moo-Berry's Moonshine Elixir (DMM) sells 12 oz bottles of healthy fruit based drinks. Marketing is important for DMM. Their point of differentiation is that
Dr. Moo-Berry's Moonshine Elixir (DMM) sells 12 oz bottles of healthy fruit based drinks. Marketing is important for DMM. Their point of differentiation is that their secret recipes use only a blend of organic fruits grown in nutrient rich volcanic soil. DMM and its direct competitors (The Healthy Cow, Fruit World, Positive Passion, etc.) sell a total of 50,000,000 units annually and DMM has 20% of this market. DMM's annual marketing budget is allocated as follows: Social media $500,000 Trade shows $15,000 Event marketing $100,000 TV and radio $200,000 Print $100,000 Social Media Influencers and Sport Celebrity Endorsements $500,000 The salary and expenses total are $5,000,000. Insurance is $40,000. Office space, equipment and supplies are $100,000. Fixed manufacturing costs (mixing and filling machines, etc) are $500,000. Salespeople are paid by a 10% commission of the manufacturer's selling price Shipping costs is $0.10 per unit. Additional cost to produce a 12oz bottle are as follows: Ingredients =$0.75, Bottles =$0.15, Caps =$0.05, Labels =$0.10 Pricing: The drinks have a retail price of $6.00. Retail margins on the product are 50%, while wholesalers take a 10% margin. What is the break-even point? 5,511,719683,974899,427435,982 What is the wholesales margin (in \$) $0.30 $3.00 $1.15 2.25 $0.60 What is the manufactures annual profit? $5,745,000 $12,800,913 $47,8894 $4,359,000 $31,987,692.25 What is the unit (variable) contribution? $1.28 $0.27 $1.42 $3.00
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