FINEPRINT

Case Analysis of FinePrint

Case Analysis of FinePrint

Introduction

FinePrint Company is primarily a printing company which specializes in colour printing brochures. The company is located in Charlottesville, Virginia. Its main consumers are mainly from central Virginia, with some in south western Virginia and Chesapeake Bay area (Lynch, 2010). The owner of FinePrint Company, John Johnson, is presented with an opportunity to expand his company's capacity. In order to do this he must consider whether to outsource some of his printing to another company in Charlottesville, Virginia named SmallPrint Shop. Currently, FinePrint is running "at around" full capacity of 150,000 brochures a month. The owner, Mr. John Johnson runs the company himself. In addition, he hired one sales representative and one printing-press operator. He also hired temporary labour to help when assistance is needed. SmallPrint has offered FinePrint a monthly amount of 30,000 brochures at a cost of $8 per 100 brochures. SmallPrint offered this low price because it has lost potential customers and now it wants to run its business at any cost. Mr. Johnson thinks it is a good deal. Our study shows most of the times outsourcing is dangerous for the business (Earl, 2012).

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Decision Making Process

Is it in FinePrint best interest to outsource some of their work to SmallPrint? In order to make this choice there exist 5 stages in the decision making process:

Setting Goals and Objectives

Gathering Information

Evaluating Alternatives

Planning and Implementation

Obtaining Feedback

Stage 1

In order for FinePrint to remain successful they must set objectives, to provide clear guidance towards future ventures. The objectives set by FinePrint should be tangible objectives which provide benchmarks against which to measure its performance. The first step is to set target profit and target cost. In order to do so, FinePrint must first determine target selling price. The target price in this case can be based off of competitors' pricing in Charlottesville, Virginia. Their objective should be to:

Create customer loyalty with an easy and convenient quality product while providing great customer service

Expand their consumer market yearly, and

Steadily increase their profit margins and revenues by applying the prior two objectives and investing more in advertising and social media (i.e. website, Facebook page, commercials, etc).

Since FinePrint does not provide public sales prices, it is imperative they set feasible target profits and selling prices in order to meet with Stage 1 standards and their competitors.

Stage 2

At stage 2, ...