This website uses cookies to ensure you have the best experience. Learn more

Compagnie Du Froid Essay

2757 words - 12 pages

To: Jacques Trumen
From:
Subject: Compagnie du Froid Analysis
Date: November 6, 2014
Memorandum
Campagnie Du Froid is a summer ice-cream business founded in 1985 by the father of
Jacques Truman. In 2007, after the passing of his father, Jacques Truman took over the business
and emphasized an aggressive growth strategy. By 2009, Campagnie Du Froid was a market
leader in the eastern part of France, northeastern coast of Spain, and northern Italy. Each region
had its own manager and the main headquarters was located in Paris. Jacques believed
decentralizing the decision making as much as possible. Each region had its own manufacturing,
marketing, distribution and sales organization. ...view middle of the document...

Andres Molas is the
manager of the Spanish region and his performance had been outstanding up until 2009. There
had been many problems that sprung up in 2009 causing the performance of the Spanish region
to decline. The first problem was the new machines weren’t working correctly until late August
which caused them to run out of capacity several times. The Spanish division had to import
product from the French division at a transfer price of full cost plus 5% profit for the
manufacturer. On top of that, the Spanish division had to absorb expenses of people traveling to
France to fit the Spanish packaging to the French production line. Lastly, there were
unseasonably cold temperatures that had driven down tourism and demand. As a result, Andres
had to cut prices in order to stimulate demand and keep with competition.
Traditionally, each manager was given the same bonus of 2% of corporate profits, but the
results in 2009 challenged the fairness of this evaluation system. The Spanish region performed
extremely poor and had driven down company’s profits to the lowest it’s been in ten years.
Jacques thought it was unfair for the French and Italian managers to pay for the problems of the
Spanish region but wasn’t sure Andres Molas was to blame for the poor results. Jacques Truman
needs to make many decisions regarding the evaluation and performance of each region.
In order to properly evaluate the difference between the expected profit versus the
actual profit in the Italian region, a causal analysis was conducted on the Italian region. The
causal analysis in Exhibit 1 allowed us to better understand the Italian business. First, we
evaluated the impact of the change in sales volume. The sales volume variance (Flexible budget
in Euros – Static Budget in Euros) produced a sales variance of €119 for Ice Cream sales and €34

for Specialty sales; this represented a profit variance of €58. While the sales volume variance is
important, it is also important to understand the amount of sales growth that is attributed to the
temperature change versus actual performance of the business. There was €19 worth of growth
strictly from the change in temperature between both ice cream sales and specialty sales. The
profit side of the causal analysis resulted in a €8 variance attributed to the temperature change
and a €50 variance related to performance which resulted in a total volume for profit increase of
€58.
The change in prices also had an impact on the Italian region’s expected and actual profit
because the €7 total sales variance represented an increase of €7 profit for the actual profit. The
€7 variance was calculated by the favorable €20 variance for ice cream sales and an unfavorable
variance of €13 for specialty sales (€20-€13=€7). This proves that the Italian region can charge
slightly more for their ice cream sales given the increase in demand, while the increase in
demand of the specialty product could be more attributed...

Other Papers Like Compagnie Du Froid

A Heart Of Darkness Essay

1748 words - 7 pages In this short story, there are frequent significant subject and ideas that make the story, "A Heart of Darkness," by Joseph Conrad, and haunting novel. The main theme is absolute white power over the natives. The theme validates the corruption, and the dependence caused by the white people as they took over the Congo. White men were giving all the power; they had no self-control, and in the end they did not use wisely. The white men became

The Aspects Of Vulnerability Among The Exploited In Medical Research

2287 words - 10 pages Essentially, everyone is in some state of vulnerability. However, some of us are more susceptible to harm due to our vulnerabilities. The susceptible are the individuals with the greatest risk. These individuals risk the loss of their autonomy, and maybe even their lives. Vulnerable populations can be found in every subset of society. However, as previously mentioned, there are some vulnerable populations that are at an even greater risk than

The Hitchhiker’S Guide To The Galaxy

1171 words - 5 pages The Hitchhiker’s Guide to the Galaxy As the human race makes life-changing discoveries, it is made apparent that there is always more to learn as the universe, instead of becoming familiar, is becoming absurd. The Hitchhiker’s Guide to the Galaxy, written by Douglas Adams, as well as the 2005 film adaption, portrays absurdity to be an all-encompassing system in the universe. Through the introduction and attempt to understand lack of reason, the

The Ford Motor Company Wage Increase Of 1914 And The Theory Of Incentives And Efficiency Wages

1252 words - 6 pages ‘It’s not the employer who pays the wages. Employers only handle the money. It is the customer who pays the wages’ (Henry Ford, cited in Johnson and Weinstein 2004, p. 2). When the Ford Motor Company announced that it would more than double the wages of its workers in January 1914 to a ‘five-dollar day’ minimum, was this a contradiction to Henry Ford’s statement? If customers are actually the ultimate payers of wages, then more than

Historical Analysis Of The Economical Breakthroughs Of The Industrial Revolution

1396 words - 6 pages A Historical Analysis of the Economical Breakthroughs of the Industrial Revolution During the Industrial Revolution, many elements of society experienced huge breakthroughs that would change the way they functioned forever. Economics were definitely one of them. With many new inventions and many factories appearing, many, many, more resources were being created than ever before. Also, all of the revenue from these resources was being given to

Leadership Portrayed in Monologue from Shakespeare’s Henry V

1214 words - 5 pages Leadership is defined as a socially constructed process and which also affect organizational future outcomes. Leader is someone at high position who have overall duty for an organization, she or he decide what to do and the way how to achieve it. (Carter and Greer, 2013)The role of leader is extremely important for an organization, leader use their own power to influence the followers though many different ways such as motivation in order to

Cuba Civil Rights

1906 words - 8 pages Picture a country that has limits on how much you can make random government imprisonments and more what do you do. That is the situation for the eleven million seventy-five thousand two hundred forty-four people of Cuba since the takeover of Fidel Castro. The US is opposed to Castro taking control of Cuba. Castro managed to ease the United States nerves when he said that Cuba was against all forms of communism. According to Lana Wylie the Union

US Freight System

1273 words - 6 pages General Environment Each American requires the movement of approximately 40 tons of freight per year across the freight network. This includes everything from shirts to lawn mower to orange juice. • As the U.S. population expands, the U.S. freight system will be called upon to meet the demands of a larger population • Between 2010 and 2035, the system will experience a 22 percent increase in the total amount of tonnage it moves • By 2050, with

Democratic Peace Theory

1852 words - 8 pages Intro: US Presidents have made it a goal during their term(s) in office to establish a good relationship with foreign countries and even try to improve upon existing connections with our allies. Some believe it is to prevent conflicts between the countries while others dispute that it is a threat assessment by the United States to pick and choose their friends and enemies. Preventing conflict between two democracies or countries that practice

Booker T. Washington

1621 words - 7 pages , southern politics, appointing Black Americans to federal jobs, and granting funds to Black institutions.” Washington formed loyal supporters African Americans and Whites as well. Booker T. Washington and W.E.B Du Bois are similar to each other but disagree on plans for African Americans social and economic progress. “Booker T. Washington, educator, reformer and the most inflectional black leader of his time (1856-1915) preached a philosophy of self

Corn, Broccoli, Grass Or Balanced

2611 words - 11 pages About a century ago, there was not an epidemic of diet-related illness, a bizarre account of destroyed farmland, dead zones in our oceans created by chemical run-off spilling into the waterways, and there sure was not millions of people questioning the moral ethics of their diet. In the Omnivore’s Dilemma: A Natural History of Four Meals, the author Michael Pollan goes on a journey to investigate the sources of the nation’s food supply, for which

Related Essays

Freedom And Responsibility Essay

2141 words - 9 pages Built within the Constitution of the United States are specifically defined freedoms that are guaranteed to all citizens. Conversely, with every constitutional freedom there comes a corresponding responsibility. On September 25, 1789, the state legislature’s twelve proposed amendments were transmitted by congress, the first two dealing with congressional representation and congressional pay. The following numbers three through twelve were

Hate Crime Laws Essay

2348 words - 10 pages On June 7, 1998, 49-year-old James Byrd Jr. of Texas accepted a ride from three white men, who then beat him severely, urinated on him, chained him by his ankles to the back of their pick-up truck, dragged him for three miles into the countryside, and dumped his corpse in front of an African-American cemetery (Graczyk). A little over a year later, a jury sentenced ring leader John King to death by lethal injection (“Man Executed for Dragging

Rational Emotional Behavior Therapy Case Study Conceptualization And Treatment Plan

2140 words - 9 pages Rational Emotional Behavior Therapy Case Study of Sarah: A Conceptualization and Treatment Plan Rational emotive behavior therapy, REBT, was developed by Albert Ellis and holds the central belief that the events in our lives do not cause our disturbances but that they are instead caused by our view of the events (Murdock, 2009). Murdock (2009) states that “people are seen as responsible for their behavior” (p. 279) but, because they are

Holidays In Albania Essay

1636 words - 7 pages Have you ever thought about having exciting and incredibly cheap vacations? Albania might be the right choice. According to My Travel Guide, Albania is ranked the fourth among ten places worth visiting in Eastern Europe (“Top 10 Eastern European Destinations”). One can encounter three kinds of vacations in this Mediterranean country: winter, summer, and cultural. The ideal places to spend your winter vacations are the Albanian Alps. They are