1:37 PM 1.5KB/s 06.11.11 31 E Adobe Scan 14-Jan... 2 Adonex India: A Case of Alternative Choices and Decision-Making ko lodia Engineering Company was into manufacturing of auto parts-axle Shaft--for- edustries since 2003. The company was an emerging on concerning manufacturers and exportati her had been gaining acclamation across the globe because of its quality manufacturing process Parker, the company's products were highly acclained in UK, Germany, France and Italy. The price and for domestic as well as export market has been same so far albeit in the relevant currency with an ever-growing demand for its product and the company's expert puterntay haing 20%. wotex India Engineering Company had national and international projets contributing to the in stated and technically important projects. In the year 2019, it was operating at ara capacity level watering to both domestic and foreign market. The company CEO, Raghavendra had just received an export order from a new market-USA- stab he did not want to miss. The order required a capacity utilisation of 40% of the plant capacity Dere was no scope for splitting the order; it had to be executed in one lot and that too as quickly as por shle The price offered after a lot of negotintion was still 10% less than the current price being charged. He called his Production Manager-Sathya Sathwik, and the Finance Manager ---Prabhat Kumar, sho were looking after the costing and budgeting of the project, and asked them to submit the details melated to the current production and possibility of additional capacity utilisation. He was given the following statement with respect to sales and costs: Particulars For a Pack of 10 units) in lakhs Sales 2.400 Duret materiai 1.120 Direct labour 480 360 Factory overheads (20% variable) 200 Selling. distribution & administrative overheads (40% fixed) Sathwik told him that variable cost-part of selling, distribution & administrative overheads-will increase by 10% because of the special type of packaging required for exports to the USA. He was of the opinion that the company should reject the export order from the customer from USA as it would result in unnecessary increase in the cost where as revenue from the order would be less thereby im- pacting the profils significantly Prabhat, on the other hand, wanted the company to accept the offer because this would have meant exposure to a new market and possibility of more clients and better pricing in future. For this, he said that the company should be ready to let the domestic sales to fill to the extent required. There was another view proposed by the Marketing ManagerPrakash Sinha. He thought that it was not wise to let go off the domestic market share. Instead the company should create additional plant capacity by installing new machinery. Prakash checked with some suppliers of the machines as well as the finance team and reported that the additional capacity because of new machinery will increase the fixed cost by 320,00,000 per annum. Raghavendra was now in dilemma as to go for which of these proposals given by Sathwik, Prabha and Prakash QUESTIONS FOR DISCUSSION: 1. Evaluate each of the options given and suggest the best course of action for Raghavendra. 2. Discuss various other factors which have to be considered before taking the decision