Sneaker 13 Harvard Case Solution & Analysis

Introduction

New Balance Company has been introducing a new product that is athlete shoes for young athletes. They are mainly targeting 12-18 ages of athletes. As no competitor is focusing on expanding it for younger people. High influential brands such as Nike and other international brands are more focusing on running male shoes for athletes aging 18-24 and ignoring the respective age which is being considered by New Balance Company.

The winner of Athletes, belongs from London, have broken the record of winners from United States and thus, received a huge feat from his country and fellow beings. Moreover, it was also analyzed that he is improving himself. This impressed the company that the younger population also takes part in athletegaming and have guts to win. Therefore, it would be a suitable target market for the company to expand itself

With speculations, it has been noted that the million dollar athlete industry would be growing with 18%, consequently, it would also have a positive effect on company’s new products and sales. New running shoes with medium tech and appropriate retail price have been developed for James, the winner, and named this product as Sneaker 2013.

However, in order to project the profits and operations of the newly developed product, projected cash flow has been required in order to analyze if this project would be profitable for the company and would generate higher returns in the future.

Problem statement

Projection is very necessary whenever initiating a new work. New Balance Company is also initiating a new product named as Sneaker 13. Therefore, cash flow projection is required by the company in order to decide whether the development of new market would be beneficial for the company in future.

Sneaker 13 Harvard Case Solution & Analysis

Key players

The people who would be plying main role in the product initiation as well as achieving sales growth and making it profitable are as follows:

  • Production team: the production and manufacturers of newly designed shoes would be playing key role. As the product would be beneficial and liked by the consumers, it would earn higher revenue and facilitate the company with profitability
  • Marketing Team: marketing plays an important part in order to make sales of a newly designed and initiated market. However, the company has allocated a higher cost such as endorsing an athlete and other advertising costs have been implemented. If the marketing of the respective product would be done in a right way, the product would be successful.
  • Supply Chain team: the team of supply chain also plays an importantfor the success of the product. If the right pre development and post development suppliers would be selected and the product would be available for customers, it would bring success to the company.

Proposed Solution

In order to make cash flows projections, indirect approach has been used. The reason of using such approach is that therevenue stream of the product has been projected by the company which has done through the market analysis, and has Compounded Annual Growth Rate of 1.8% and it has been projected that market would reach to $84.4 billion in 2018, when the Sneaker 2013 project would be ending............

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