Question

THUNDERBIRD A01-06-2012 GRAEME RANKINE AUSSIE PIES (A) "Wow, Australians really love their meat pics." Anna Amphlett said to Andrew Ferris as they sat at the Melbourne Cricket Ground watching the Australian Football League (AFL) Grand Final between the Sydney Swans and the West Coast Eagles. "I've seen people eat three meat pies straight, then wach them down with a full liter of Fosters Lager," she said as she looked across to see Sydney win the 2005 Premiership with a score of 58-51. According to observers, "Sydney has ended the longest premiership drought in AFL history in the most emotional and heart-stopping fashion imaginable by beating the West Coast Eagles by four points in the most exciting and closest grand final for nearly 40 years. But it's not just at footy matches," Ferris noted, "they eat them all the time, just like we eat hamburgers and hotdogs back in the States." Ferris thought about the number of pies eaten by the 100,000 people attending the AFL Grand Final. Amphlett and Ferris lived in Scattle, Washington, but were on a vaca tion to Australia to visit the Great Barrier Reef and attend the Grand Final in Melbourne. "I wonder if Americans might develop a following for the Aussic meat pic," he said to Anna... perhaps there's a business opportunity back home." Australian Meat Pies The meat pie, a hand-sized pot pie made with pastry and filled with minced (ground) beef and gravy, is consumed as a takeaway food snack in Australia (sce Exhibit 1 for an illustration of a meat pic). Accord ing to some observers, it is iconic in Australian culture and has been described by former New South Wales Premier Bob Carr as Australia's national dish." The average Australian will consume an average of 45 meat pies per year, and the popular brand Four'N Twenty Pic produces 50,000 pies per hour. The meat pie is heavily associated with Australian Rules football, rugby league, and other sports as one of the most popular consumables while watching a game. The meat pie is about four inches in diameter and traditionally eaten in the hands with tomato sauce (aka tomato ketchup) and is usually accompanied by a cold beer. The pie has a short crust bottom and flaky pastry top (see Exhibit 2 for a meat pie recipe). Business Opportunity On returning to Seattle, Amphlett and Ferris continued working at their corporate jobs, but during their off-hours they would meet for beers at the Roanoke Tavern where they talked about launching the new meat pic business. They even registered the trade name. Aussie Pie in case they later decided to introduce the concept of the Australian meat pie to American consumers. Amphlet was a regional manager of Starbucks, while Ferris was an assistant controller for Tully's Coffee Corporation. Amphlet started at Starbucks five years earlier after completing a history degree at AFL Web site: afl.com.au From Wikipedia Ibid. herpel/swengelsk.com/COOKING/Australian Food.htm. Copyright 2006 Tooded. The Gari School of International Management. All rights resered. This prepared by Professor Grueme Rankine for the purpose of dessere discussions and not to indicate cher effective inctive management

Answer 1

per month 11900 $ tood † 5000 calculation & rided cost Store Rent 18 Cooke ng equipment Rent talare Rent Two chef Assistant salary $ 1800x2 Otilities cost Save Assis tant 53 600 $ 300 $1200 calculation of variable cost pervuit Ingrediant cost $1.20 per pie utilities consume in making $0.03 perpie Additional packaging cost $0.02 perpie. variable cost perpie(a) $1.25 perfil estimated production .. M 16 30000 pie $37500 Total nariable cost to produce 30000 pie REDMI NOTE 6 PRO MI DUAL CAMERA

Carlin Page Date I I calculation of propit on 6000 pies sale film Sales 6000 X+3.25 $21000 les variable cost for 600opie 8000 x $1.25 $ 7500 lers fixed cost $ 30000 (116500) calculation of break even sale les o reak sales perpie $3.25 vanable perpie $1.25 contribution 2 Per Are even sale - aed cost contribution perpie $ 27600 2 = 13800 pie VR len Sale 13800X $3.25 = 44850 vanable cost 13800 X $ 1.252 17250 $ 276.00 Hold cost $27600 lers $44850 Poneakeren sale REDMI NOTE 6 PRO MI DUAL CAMERA

calculation of making e ade'stribution cost it heill be total nariable cost le variable cost per pie x unit produce $ 1. 25 X 30000 pie I 37500 Explanation Hood cost It reders to cost that does not change with the change in level of production, It remain same even if production increase or decrease variable cost. This cost is changed heith the chance is level of production. f production. - is more nanable cost will be hish and id production is low the hariable cost will be low. break even - It refer to a point where - there is no profit or loss Where totol cost = total sale total cost include fioed as hariable both. Assumption ! - making a distribution cost will include rariable cost only. It heill not consider tined cost. REDMI NOTE 6 PRO MI DUAL CAMERA