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BALA Footwear

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BALA FOOTWEARS

Managerial Economics Project Presentation

GROUP MEMBERS Hassan Abbas Muhammad Saad Hafiz Islam Aslam Adil Naeem Osama Imran

Introduction to Company

Introduction to CompanyBala Footwears

1. Bala Hawai Chappal2. Bala Eva

3. Bala PU4. JS International Trading Co,.

HierarchyCEO Haji M. AslamDepartment Head

Departments Head

Haji M. Iqbal

Haji M. Afzal

Labor Dep.

Stock Dep.

Purchase Dep. Finance Dep.

Sales Dept

Accounts Dep.

Production Dept

Import & Export Dep.

Bala Hawai Chappals Established in 1985 Companys main business Capacity to produce more than 1300000 pairs annually Export to Europe and Australia Rubber Flip Flops and PVC Flip Flops

Bala EVA Established in 2005 Import Plant from Taiwan Eva Slippers and Eva Flip Flops Eva Compounding machine to maintain the quality

Bala PU ( Polyurethane ) Established in 2009 Import the PU plant from China Producing leather slipper Providing jobs to more than 150 employees directly and indirectly

JS International Trading Company Import and Export Import machinery from Taiwan and China Import Polyurethane resin and other chemicals Export products to Australia, France and Dubai

Introduction to the Product

PU Slippers Can be made light, comfortable, flexible and hard Direct attach PU outsole for durability and flexibility Ideal casual wear Attractive styling

Economic ProblemsAvailability of Polyurethane resin Shortage of Electricity and Sui Gas Availability of Artificial leather and other important items Lack of skilled labor

Causes of Failure of Product High energy prices and other inputs Outdated production methods are still prevailing in the factory Improper availability of raw material Transportation and utility infrastructure facilities are not adequate The company is facing high competition from china

Steps to Increase Demand New techniques for production, design andmarketing Needs to build outlets at domestic level Participation in trade fairs can increase exports Research and development activities for improving quality and physical testing services Use of e-commerce strategies can broaden their product market

PRODUCT COST ANALYSIS

Fixed Cost of PU slippers (one month) Factory Rent Factory Permanent Labor salary Management Salaries Depreciation Expense Manufacturing Plant Rs. 343000/4 = Rs. 85750 Rs.38000/4 = Rs. 9500 Rs. 80000/4 = Rs. 20000

Rs. 5000000 10% 1/12 Rs.41667/month

TOTAL FIXED COST

Rs. 156,917

Variable Cost of PU Slippers Polyurethane Material Cutting Charges Printing Charges Embossing Charges Upper Leather Inner Leather Upper-Man Wage Bottom-Man Wage Production labor Wage Packing Trimming Wage Electricity Charges Packing Material Transportation Cost Other Misc.exp Buckles TOTAL VARIABLE COST Rs.5250000 Rs.300000 Rs.300000 Rs.225000 Rs.1875000 Rs.1125000 Rs.525000 Rs.225000 Rs.750000 Rs.450000 Rs.375000 Rs.525000 Rs.150000 Rs.375000 Rs.675000 Rs.13125000

Variable Cost per Unit Items Polyurethane Material Cutting Charges Printing Charges Embossing Charges Upper Leather Inner Leather Upper-Man Wage Bottom-Man Wage Production labor Wage Packing Trimming Wage Electricity Charges Packing Material Transportation Cost Other Misc.exp Buckle Rs. 70 04 04 03 25 15 07 03 10 06 05 07 02 05 09 175

Variable Cost per Unit

Fixed Cost per unitFixed Cost per unit = Total Fixed Cost / No. of Units = 156917/ 75000 = Rs. 2.09

Profit Calculations The price selling charged by the company is as follows: Price of PU slipper/unit = Rs. 195 Profit considering Average variable cost Per Unit Profit = (P AVC) Per Unit Profit = (195 175) Per Unit Profit = Rs. 20 Total Profit = Q (P AVC) Total Profit = 75000 (195 175) Total Profit = Rs. 1,500,000

Profit Calculations Profit considering Average cost Average Total Cost per unit = Average Cost per unit + Average Fixed Cost per Unit TC = 175 + 2.09 TC = 177.09

Per Unit Profit = (P AC)Per Unit Profit = (195 177.09) Per Unit Profit = Rs. 17.91

Total Profit = Q (P AC) Total Profit = 75000 (195 177.09)

Total Profit = Rs. 1,343,250

Market Structure

Market Structure Number and size of sellers Number and size of buyers Product Differentiation Entry/ Exit

Companys Role in the Economy of Pakistan

Companys Role in the Economy of Pakistan Shown Good Performance Increase Exports Local Consumption Exports Generating Employment Business in different Countries

Thank You

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