Assessment:
It is expected that each student work independently on all the tasks set out in this assignment, applying problem solving strategies and selecting appropriate techniques in modelling and simulation in order to produce an individual report according to the guidelines provided. This individual work must be your own work only with no consultation with others.
The individual report must not exceed 2,000 words. Submit your completed report only via the turnitin link which will be available a week before the assignment submission deadline in the "Assessment & Feedback" folder.
Assignment Title: "A Solar-Powered Camping Tent"
The Concept Tent (also known as the solar powered tent) was thought up because of demand by nomads, recreational campers, and disaster victims. Tents are typically used as overhead shelter for festivals, weddings, backyard parties, and major corporate eventsand the fact that all tent users need to keep in touch with their families, friends and colleagues while they're for example, camping and roaming around the festival site.
Kaleidoscope and OrangeCompany designed it in partnership to celebrate Glastonbury Festival. Its design is the revolutionary new way it collects direct sunlight. The idea is that specially coated solar threads are woven into conventional fabric so designers wouldn't have to use fixed solar panels to harness the energy. It would also have three directional glides that can be moved throughout the day to maximise solar efficiency and energy collection.
But the most amazing bit about this concept solar powered tent is its central wireless control hub which lets you see the amount of energy being generated and used, as well as sending out a wireless internet signal for anyone who needs to surf the internet.
The control hub also has a wireless charging pouch which powers mobile phones and other portable devices without the need for messy wires and multiple chargers. The ‘magnetic induction' technology passes an electric current through a coil embedded in the charging pouch and this in turn generates a magnetic field which creates a charge and powers the battery.
Also controlled by the central hub is the most amazing bonus for the ultimate posh camping experience... an internal heating system. This takes the form of a heating element that's embedded within the tent's groundsheet giving under floor heating that can be triggered automatically once the temperature falls below a set level.
The market demand for the Concept Tent is estimated to be 2,000 units in its first year of production and expect to increase sales by as much as 10% per annum thereafter. The variable costs per unit are estimated as follows: raw materials, £8.00; packaging, £2.00; direct labour, £5.00; distribution, £3.00.
The inflation rates for the next three years are forecast to be 3%, 5% and 6%. Inflation will affect variable costs for the product but fixed costs are likely to remain at the same level of £10,000 over the next four years. In calculating profits over the next four years, the tax rate can be taken as 20%. Kaleidoscope and Orange intend to sell the Concept Tent at £65 for the first year with an annual increase of £2.00 thereafter.
Task 1
(a) Kaleidoscope and Orange have asked you to develop a financial planning model so that they can determine how net profits would be affected by changes in planned sales volume and product price over years 2 to 4.
(b) Having built the financial planning model, Kaleidoscope and Orange now want to look at three ‘what-if' scenarios.
• Scenario 1: Suppose inflation is predicted to be 2.5% during the second year and 3% thereafter. What would be the profitability of the new carving knife in these circumstances?
• Scenario 2: Suppose the Company decides to sell 3% more units per year as well as increasing the current selling price by 10% per year. What would be the effect on the ‘net profit after tax' for each year?
• Scenario 3: Suppose that Kaleidoscope and Orange decides to vary the projected sales volume over a range from -5% to 10% of the initial assumption. The company wants to see how the ‘Net profit after tax' would change as the projected sales volume changes.
Kaleidoscope and Orange have decided to make a major capital investment in the introduction of a Rainwear that acts as smart as it looks. Effective rainwear keeps out the rain, but no membrane breathes well enough to keep you comfortable during exertion. When rainwear is necessary, this design offer unique physical venting approaches to keep you more comfortable.
There is usually a large amount of uncertainty associated with the development and marketing of any new product, e.g., the size of potential sales, the ideal selling price of the product, and the manufacturing costs. These uncertain factors are best represented by appropriate probability distributions, and the project's profitability can then be investigated using simulation. Such an approach is generally referred to as ‘risk analyses.
Kaleidoscope and Orange has asked you to perform a risk analysis on the marketing of their new rainwear product. The capital investment required to market the product is £12,000. The factors associated with the new product and their respective probabilities are provided in Table 1.0 below:
Table 1.0: The factors associated with the new product and their respective probabilities
|
Selling Price
|
Probability
|
Variable Cost
|
Probability
|
Sales volume
|
Probability
|
|
£32
£34
£37
|
0.3
0.4
0.3
|
£8
£10
£12
|
0.4
0.4
0.2
|
10,000
15,000
20,000
|
0.25
0.50
0.25
|
Task 2
Prepare a report that discusses the general development of the spreadsheet simulationmodel, and make any recommendations that you have regarding:
(a) The worst and best results obtained in a simulation of 1000 trials;
(b) The mean profit and its corresponding risk;
(c) How the profit values are distributed over their range, and what profit values are most likely;
(d) The probability of a loss;
(e) Interpretations of your findings.
A simple guide for providing a clear structure to your group report
Front Cover
You need to have a front cover to tell the reader about the title of your assignment, your course, the unit, full details of group members and percentage contribution of each member
Executive Summary
This is a brief summary of your whole report and you should write it when you have finished the project, you may want to write it using these headings:
a) Background
b) Purpose/Objective
c) Methodology
d) Key Findings and Conclusions
e) Lessons Learned
f) Recommendations
This should about 200 words.
Table of Contents
This should be a list of main headings and sub-headings that you have used in your report such as:
1.0 Introduction Page 2
2.0 Methodology Page 3
Etc.
This should not be so detailed that the reader gets lost or so short that says very little.
This should provide a clear structure with correct paging on one page.
Introduction
In the introduction you are telling the reader
(a) What is going to be considered in the report?
(b) Why is the report written - the importance of the report to the reader
(c) How is the report organised
This should about one full page.
Methodology
This should be where you answer each question raised in the assignment as fully as you can with the aid of charts, diagrams, graphs, summary tables and all you calculation nicely put together and clearly presented and interpreted.
This should be about one page for each question in the assignment.
Conclusions
What are your key findings? How does your finding help managers to make a more informed decision? How does your finding may help in improving processes or products or services?
This should look back at the methodology and your findings and should about ¾ of a page.
Recommendations
From your findings and conclusions can you recommend 5 or 6 points that would really help to improve the Company?
References
This is where you put down any resources you have used to compile your report, such as: books, websites, etc.