Question

Gianni & sons buys t shirts in bulk, applies own trendsetting silk-screen designs and then sells tshirts to number of retailers. Gianni wants to be known tions 2016 2017 trendsetting designs, and it wants every teenager to be seen in a distinctive Gianni t shirt. Gianni presents following data for first two years of operations 2016 & 20 215,000 15,000 200,000 30 245,000 20,000 225,000 Number of t shirts purchased Number of t shirts discarded Number of t shirts sold Avg selling price Avg cost per t shirt Administrative capacity (customers) Administrative costs Administrative cost per customer 4,250 4,500 $1,633,500 $1,593,750 $363 375 Administrative costs depend on the number of customers Gianni has created capacity to support, not on actual number of customers served. Gianni had 3,000 customers in 2016 and 3,500 in 2017. Is Giannis strategy one of product differentiation or cost leadership? Explain. Charge a premium touse desie skills to make specific shirts for customers Describe briefly the key measures Gianni should include in its balanced Scorecard and the reasons for doing so da industry standards Internal bus process: # of defective units Financial: sales and profit margin Growth

Answer 1

Answest! Given data: → Gianni & Sons buys T- Shiats in buik, applies Own trend Setting Silk--screen designs sell T-shirts to number of retailers. → Number of t. shiorts purchased 2.15.000 2,45.000 → Numbeor of t-shirts discarded 15,000 20.000 → Number of t-shisits sold 2.00.000 2.25.000 → Average selling potice 30 31 → Average cost peor t-shirt 15 13 → Administrative capacity 4.500 4.250 -> Administrative costs $ 16,33,500 $15.93,750 -> Administrative cost peor customer $363 $ 375 → Gianni had 3,600 customers in 2016 3,500 customers in 2017

* In a poroduct differentiation strategy fiorm used distinctive poroduct to distinguish itself in the market. * During this storategy, fisim poroduces poroduct With distinctive features to differentiate with other poroducts * This could be sold at a premium price. * The balanced Scorecard transforms the Organization Strategic objectives that are to be achieved into a set of performance measures * These measures que used to compare the set target performance measure number to the actual performance measwore numbes to access whethe ut the strategic objectives of the form are achieved

01) The from Gianni and sons strategy is of poroduct differen tiation - Gianni and sons poroduces T- shiott a with distinctive styles that set the Product T- shigt as dis tinctive from Others in the market → There is competitive advantage to To shiuit → Therefore, customers shall buy T-shirt based in these distinctive features only. → The price set is at a premium Of $0. : the police has been increased from $ 30 in 2016 to $ 31 in.2017 → The premium is charged due to the products distinctive features → The number of customers have decreased not increased → The cost leadership strategy where the prices are lowered and the Sale volume are increases. the above storategy is of poroduct differentiation not cost leadership.

02) four financial performance measure the key measures → That can be adopted are of Operating growth and revenue growth for the satisfaction of the customes the amount of customer satisfaction can be measured using the number of new customers and the customers satisfaction rating > Gianni and sons can survey the . customers about how much they like the desings, delivery time → It can also include the delivery time to customers → As. the G&S mainly designs the T- Shiotts and delives them to Sietailers → Therefore its important to know the designing processes efficiency and the delivery time -> G&S can also align employees and organization goals that can be measured with the employee Satisfaction ratings.

- the number of employees trained in process and quality management is a measure required to make sure that the employees are in the position → to improve the designing process and the Quality of the T-shirts