Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Sweet William's Almanac soaps sells hand-crafted soap at craft fairs and and special events, but the owner, Willa Henderson needs to increase the business. She's
Sweet William's Almanac soaps sells hand-crafted soap at craft fairs and and special events, but the owner, Willa Henderson needs to increase the business. She's considering a couple of options. Las year, she sold $20,000 of soaps, lotions, and sundries. An estimated 80% was soap. A marketing firm has offered to build her a web site for $10,000, and maintain it for a fee of $2000/month. There are no guarantees as to how much soap sales will increase. Alternatively, where Willa feels that $5 per bar is the right price for her customers, she believes that Diva's, a national clothing chain could sell the bars for $8.00 each in their new salons. Thus, she could wholesale the bars to them for $4.00 each instead of her usual $2.50/bar wholesale price. Jane feels her variable costs are $1.56 per bar. At present her wholesale sales are nearly 0, and her market is very local and website sales are also nearly 0. c. Willa believes the cost of a direct marketing campaign, plus 2 trips to Diva's headquarters would be $5,000. What would be the unit and $ break-even on the wholesale campaign. Select one: O a. None of the others. b. $7485/1497 O c. $8197/2049 bars O d. $8197/1690 bars
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started