Greener product development initiative for Juicy, Inc.
Question
Task: How can Juicy, Inc. implement a greener initiative to improve its Greener product development initiative packaging while ensuring financial viability?
Answer
Business Case Proposal
Royce Kahler
Compliance Bio-Scientist
JUICY, Inc.
Proposal Summary
The Greener product development initiative development team would like to start a greener initiative to bring our Greener product development initiative containers up to a more environmentally friendly standard. The overall long term costs would be minimal but an initial investment of $90,000 would be needed for new equipment and additional branding. While the cost of Greener product development initiativeion should normalize in 7 years, the possible increase in customers could produce an additional $170,000 in revenue. The packaging department has confirmed that, after purchasing equipment, a complete transfer could be achieved by the end of the fiscal year.
Proposal Development
Contributing to this proposal was Jane Clark, senior manager from operations, Kevin Dale, floor manager of the packaging department, and Todd Knowles, outside consultant with marketing.
Technical Changes
The chemical structure required to create a more bio-degradable material would need only minor tweaking. (See attached notes on decomposition process.) The most important factor would be purchasing a new machine and training employees in the packaging department. Standard-Knapp makes an appropriate industrial machine that could be customized for our needs (specs on the 939V model can be provided). The operations department suggests a six-week testing period and then small-batch releases.
Greener product development initiative Cost/Benefits Analysis
|
Cost |
Value |
Assumptions and accuracy |
|
Purchase and installation of new equipment |
$50,000 |
Fixed price quote |
|
Testing of new chemical formula |
$20,000 |
Estimate with 80% accuracy |
|
Rebranding |
$20,000 |
Estimate from the marketing department |
|
Benefits |
Value |
Assumption and accuracy |
|
Energy |
- $36,000/ annual |
New machine not only uses less material but also uses less energy. Estimated savings. |
|
Market Expansion |
$170,000 |
Target Market: Green. Marketing has done extensive research showing this as an area of an expansion and suggest Boulder, San Francisco, Portland and Atlanta as test cities. |
|
Safety |
Estimated at $7,000 |
Retraining on a new machine will improve safety standards. |
|
Materials |
Less material costs over 7 years -$60,000 |
We will use 1/3 less of current materials. |
|
Reputation |
Not included in this estimate |
Greener alternatives have shown positive effects for retailers. |
Greener product development initiative Risks
Chemical compound difficulties: Based on prior research, testing goes smoothly. Additional costs can resolve this issue if it arises.
Poor test feedback: Additional cities or a change in marketing materials.
Next Steps
After confirmation from the steering board meeting on September 5th, a full 20-page business plan will be completed for the following meeting on October 3rd. Greener product development initiative
