Financial Analysis, implementation, controls

Running Head: FINANCIAL ANALYSIS 1

FINANCIAL ANALYSIS 8

Financial Analysis

Canadian Solar Inc.

Date

Financial Analysis, Implementation, Controls and Contingency Plan

Financial Analysis

Canadian Solar, Inc. Company Comment by Sandra Ducoffe: While your calculations are correct here, they need to be based on the units specified and price set in your marketing strategies section. Fixed costs for producing solar panels will be in the millions of dollars and the unit price of $12 and sales of only 500 units is far too low. Make sure your group agrees on the forecasts and prices. These should also coincide with the objectives your group sets.

Analysis	Amount
Forecasted units sold	500 units
Forecasted average unit price	$12
Forecasted total sales	$ 6000
Forecasted average unit variable cost	$ 6
Forecasted fixed cost	$ 20000
Breakeven point (units)	= 3333 units
Breakeven point (in US dollars)	= $ 40,000

The total cost of Canadian Inc. entails variable cost and fixed cost. The fixed cost includes insurance premiums, property taxes, and audit fees. Variable cost involves expenses on raw materials, labor, and utilities (Tanco, 2019). The Company will break even after selling 3,333 units and also after attaining revenue of $ 40, 000. Comment by Sandra Ducoffe: The fixed costs are for the capital equipment to produce the solar panels—so ALL of the manufacturing equipment necessary to produce the panels. Comment by Sandra Ducoffe: Your figures MUST be based on industry standards, current sales, current or recommended price, etc.

Implementation Comment by Sandra Ducoffe: This section of the plan is FAR TOO LONG. The financials need to include the table (with corrected figures) and your explanation/justification for the figures in a paragraph or so below.Then, you need one paragraph explaining when the plan will begin—so is it for January 2020? Or June 2020, for example? Marketing plans are typically written to last one year. Comment by Sandra Ducoffe:

Team

Select independent facilitators and people with different perspectives ranging from leaders, customers, funders, and suppliers. Additionally, choose representatives of various aspects of the Company, for example, sales, marketing, production, distribution, and customer service. Individual teams will be assigned different segments of the marketing plan. The selected team will possess skills and knowledge of conducting a situation analysis, analyzing the clients' market, formulating various strategies, and analyzing the financial situation of the Company.

Time frame

The time frame for the implementation of the marketing plan should be two months to put all segments of the marketing plan into action. The time frame will be enough to conduct a situation analysis, analyze clients’ market, formulate various strategies, and analyze the financial situation of a company.

Financial and Human Resources

The business managers will avail of financial resources to facilitate the implementation of the marketing plan. The human resource will select team members with the necessary skills. Human Resources (HR) will complete an in-depth analysis of benchmarking compensation and benefits packages. It will have the objective of gathering a group of people with different perspectives to contribute meaningful ideas to boost the marketing operations of Canadian Solar Inc. All goals and scheduled tasks must be met and communicated effectively to various departments that partook in this project.

Distribution of tasks

Regarding SWOT analysis, it is a planning and brainstorming tool that helps a company evaluate its projects and formulate its business plans. SWOT stands for strengths, weaknesses, opportunities, and threats. It used to identify and analyze the company's internal strengths and weaknesses as well as its external opportunities and threats. Its results may help the company improve its business or forecast how a new product or will do on the market (UMGC, 2019). The team will determine strengths per competitive advantages, physical assets, available assets, successful business processes, the ideality of location, and the quality of management. Comment by Sandra Ducoffe: None of this belongs in this part of the plan.

Concerning weaknesses, the group will determine gaps in the Company, business processes that need improvement, availability of capital, and sustainability of business processes. Concerning opportunities, the team will evaluate upcoming events, a growing market, and favorable regulations. As per threats, the team will analyze terms of suppliers, potential competitors, and technological advancement.

As part of contingency planning, Canadian Solar Inc. should conduct a risk analysis of all its sites to determine the most looming and latent threats to occur. Contingency strategies will be driven on a case by case base depending on the location. As a counter to weather-based threats, the company will continuously seek out more geographical location insulated from common occurrences of tornadoes, hurricanes, floods, and other weather natural phenomena. Compliance with environmental regulations to federal, state, and local legislations threat is vital in this process. Any discrepancies found will require the attention of Canadian Solar Inc. to fix the problem in missing Comment by Sandra Ducoffe: The contingency should have its own sub-heading and needs to more specifically address solar panels. What happens if sales fail to meet objectives? What would you suggest CS do in that case?

Concerning pricing strategy, the respective team will determine the price per breakeven units and margins of net profit, operating profit, and gross profit. Teams will also establish an amount according to tactics such as discounts, incentives, and premiums. Concerning distribution and supply chain strategy, the team will analyze marketing channels, physical distribution, and use of intermediaries before making the final decision of distributing and supplying products. Comment by Sandra Ducoffe: I don’t understand why any of this is in this section of the plan? It does not belong here.

Regarding the branding strategy, the respective team will determine the products' benefits, attributes, features, quality, packaging, and supplemental products attached to it. Concerning the marketing approach, the respective team will adopt a holistic and integrated approach of advertising, personal selling, and sales promotion. Concerning segmentation and positioning, the individual team will select target markets according to the needs and wants of the customer. Additionally, the team will also formulate a method of positioning products relative to the competition.

Concerning marketing objectives, the respective team will formulate both qualitative and quantitative objectives according to the mission and goals of the Company. Quantitative targets will entail sales, market share, and profitability. Qualitative objectives will include quality, satisfaction, and social responsibilities. In connection with the analysis of the market, the respective team will determine customers' needs, benefits of the product, payment plans, and distribution channels. Additionally, the team will also analyze the seasonality of sales, marketing regulations, and the size of the market.

Concerning PESTEL analysis, -sometimes called PEST analysis- it enables the company to identify, analyze, and monitor the political, economic, social, technological, legal (including regulatory), and environmental factors that may affect its operations (UMGC 2019). The respective team will determine and analyze political, economic, social, technological, legal, and environmental characteristics that affect the operations of the Company. Regarding porter's five analysis, the respective team will analyze competitive forces and opportunities in the Company. Concerning situation analysis, the individual team will conduct in-depth research of the companies' operations, global reach, and range of offerings. Additionally, the team will also analyze the value proposition, benefits, and needs that satisfy the customer (Williams, 2017).

Control

The respective team will check the progress of the implementation of the marketing plan to ensure it's on track. The team will analyze changes in the number of sales, the number of new customers, the difference in the profitability of the Company, the growth of the Company, and available regulations in the Company. If the implementation has deviation, the team shall formulate control measures to regulate variation. Control measures entail promotions, discounts, incentives, and advertisements Comment by Sandra Ducoffe: This is fine for controls but the measures you list belong in the contingency plan.

Contingency plan Comment by Sandra Ducoffe: This is very thorough but, again, too long for this part of the plan. You need to keep this portion to a couple of paragraphs.

Contingency plan refers to a strategy of managing risks by preparing for potential events that might affect the viability of the Company (Davis, 2019). The team should identify sources of uncertainties, the impact of the risk, classify and prioritize the chance to determine deviation in production plans. The difference will entail a reduction in sales figures, market share, profitability, changes in government regulations, and drastic competitors' moves.

Concerning drastic competitors’ moves, the Company should conduct thorough market research to identify opportunities that can give the Company a competitive advantage. Regarding changes in production plans, the Company should invest in technological products that will aid in producing bulky goods. Concerning the deviation in sales figures, the Company should maintain a constant amount of sales by advertising, promoting, and giving discounts on its products. Regarding profitability, the Company should minimize the cost of producing products to increase profit margins.

About marketing plan metrics, the essence of control action is to ensure that it meets and coordinates with the marketing team as the plan of the Canadian Solar Inc. is a plain and straightforward, which is to promote the business across the United States and on a substantial basis with the support of the marketing team. Besides, a corrective and well-balanced scorecard with a proper segment must be drafted.

Making changes to the Key Performance Indicators (KIPS), control has a very crucial aspect. Its the results derived from the evaluation and investigation done on various policies and balanced scorecards. The best way to redefine the deviations is to make targets: 0-15%, the variation is acceptable without any changes. 16-75% deviation is acceptable after the rework, or replans of strategies made the marketing team on the goals defined. Comment by Sandra Ducoffe: Cite for this?

Any deviation above 75% will lead to complete cancellation and will lead to possible new strategies.

References Comment by Sandra Ducoffe: I did not check these against the paper as so much of this milestone is unnecessary and needs to be deleted.

Davis, D. W., Braud, D., Reeder, K., & Guidry, R. J. (2019). Louisiana Oil Spill Contingency Plan Map. DOJ.

Tanco, M., Cat, L., & Garat, S. (2019). Breakeven analysis for battery electric trucks in Latin America. Journal of Cleaner Production, 228, 1354-1367.

UMUC. (2019d). PESTEL Analysis. Retrieved on 11/20/2019 from:

https://learn.umuc.edu/d2l/ext/rp/423980/lti/framedlaunch/43de3c14-dd50-474b-b14a-d0a23e551bbcmarketingcommunicationsandthechangingmedialandscape.html?ou=393835

Williams, E. E., & Dobelman, J. A. (2017). Financial statement analysis. World Scientific Book Chapters, 109-169.