Assignment 2: Price Analysis for the Navigation System

PROPOSAL

Vincient McNeil

Strayer University

BUS315 Cost and Price Analysis

BUS315 Cost and Price Analysis

Professor Marcus Sims

January 22, 2014

PROPOSAL

COMPANY DESCRIPTION

Name: NavoTech Inc.

NavoTech Inc. is a company that is aiming at making a positive difference in the drone navigation system industry. The company is competent enough to improve the quality of services offered in the field of drone technology, for any application, whether it’s the strictest of requirements for military applications, construction zoning and leisure travel expeditions.

Mission

The mission of NavoTech Inc. is to provide the best technology available in the market, especially in the Drone Navigation System industry. Our company will provide a product that the drone manufacturers are able to efficiently and effectively introduce and manage into their products. The NavoTech Mission is to deliver excellent service and dependability without sacrifice.

Vision

Our vision is to be the company of choice of drone manufactures within the next five years or less, and this is due to the quality, efficiency and effectiveness of our products offered.

Product

This company engages itself in the manufacturing of a security and control unit, called the Drone Monitoring Unit abbreviated as DMU. This unit it able to offer total control and management of the drones navigation capabilities, while also providing all necessary network security details as needed. The whole system is made up of security cameras, a transmitter, receiver and the control unit. The drone has a mounted cameras and transmitter system, while the control unit and the receiver are ground stationed. With this system in place, the drone can be easily controlled and is able to give secure information at a moment’s notice. It can also be programmed to navigate itself for sensitive and secure tactical missions, while also being able to sense danger and issue warnings and strategic strategies to the ground based unit.

Staff Analysis

NavoTech Inc. is made up of competent professionals who are committed to their work. They have relevant skills and qualifications that suit their various positions within our company. The team is highly motivated and dedicated to the provision of high quality services, so that our products have met the strictest of quality standards. The company is made up of various departments with each assigned its individual duties. Each department has a department head that coordinates all the activities that take place in their department. The employees need to report to their departmental head; this has enhanced accountability and personal responsibility by the employees in the various departments of the company. The company has an overall head who oversees the activities of the entire firm, with the help of departmental heads who provide them with internal department reports. The structure of the company is in such a way that each member is personally accountable for everything under them; this has improved the quality of service within the company.

Target Clientele

This company’s main targets are the manufacturers of drones and drone technology. We aim at providing businesses with high quality products, which will improve the control and management as well as the navigation of their drones.

Criticism of VectorCal forecasting method

VectorCal uses the time-series method of forecasting, which basically a “Time Since the Last Buy” approach is according to Ellis Kimberly, (2010). This method uses historical data to forecast future demand. It is not an efficient method because it assumes what took place in the past is what is taking place and will continue taking place even in the future; this not true especially in the drone navigation system industry. The forecast method cannot be used for long-term purposes because future trends are likely to be very different from the current ones. Depending on such a forecasting method will give unreliable results.

NavoTech Inc.’s forecasting method

Being a company that has started and having no historical data, NavoTech Inc. decided to adapt the Delphi technique for forecasting. This method relies on opinions of experts and the predictions obtained through it have proved to be more accurate as compared to other methods. Expert opinions are assessed in successions that are keenly controlled in order to obtain the predictions. This method is reliable because the experts involved are drawn from different backgrounds and they must be competent and knowledgeable. The approach is also based on current trends which; this implies that predictions are realistic (Armstrong, 2001).

Semi-variable cost

This cost remains unchanged or fixed up to a certain level of volume of production. For a start-up business, it is important that costs like these are clearly estimated, so as not to halt the operations of the business. This cost should be fixed at least until a certain number of units have been produced by our company (Bragg, S. 2014).

Direct and indirect costs

Direct costs are the ones that run particular schemes in our organization. These costs can be easily tracked down, because they are used for items like salaries of employees or for the needs of projects in the company. For a start-up company, the costs must be carefully set so as to meet the targets. On the other hand, indirect costs are responsible for multiple projects and a particular one as in direct costs. They finance activities that cannot be easily traced in terms of how much each benefited.

All these costs are so important for the survival of a startup business, it is therefore advised that experts are involved in determining them (John, 2002). Here at NavoTech we have employed a great group of accounts that has helped in the determination for pricing our goods and services to be the most competitive company in the market for supplying navigation components and systems.

Summary

NavoTech, will be the leading supplier of command and control components for various drone to navigational applications for any industry. Our experienced staff is first to none in quality production standards and personal accountability for the products that we supply.

We here at NavoTech look forward to offering you a demonstration of our products that we supply, at this year's upcoming trade show. Remember NavoTech's Mission, it is to deliver excellent service, a dependable product, without you having to make the sacrifice.

References

Armstrong, S. (2001). Principles of forecasting. Norwell, Massachusetts: Kluwer Academic Publishers

Ellis, K. (2010). Production Planning and Inventory Control. New York: McGraw-Hill

John, D. (2002). Storm Watchers. New York: John Wiley & Sons

Rowe, G. & Wright, G. (1999). The Delphi technique as a forecasting tool: issues and analysis. Retrieved from http://www.forecastingprinciples.com/files/delphi20technique%20Rowe%20Wright.pdf

Bragg, S. (2014). Accounting Tools. What is a semi-variable cost? Article Retrieved from http://www.accountingtools.com/questions-and-answers/what-is-a-semi-variable-cost.html