Note: This report is far more comprehensive than would be expected from a candidate in exam conditions. It is more detailed for teaching purposes.

T4- Part B – Case Study Jot – toy case – March 2012 REPORT
To: Jon Grun, Managing Director, Jot From: Management Accountant Date: 28 February 2012

Review of issues facing Jot
Contents 1.0 2.0 3.0 4.0 5.0 6.0 7.0 Introduction Terms of reference Prioritisation of the issues facing Jot Discussion of the issues facing Jot Ethical issues and recommendations on ethical issues Recommendations Conclusions

Appendices Appendix 1 Appendix 2 Appendix 3 Appendix 4 Appendix 5 Appendix 6 Appendix 7 SWOT analysis PEST analysis Selection of new outsourced manufacturer for products YY and ZZ VP “own brand” proposal Inventory valuation Calculations for outsourced manufacturers P and Q for licensed action figures Email on the key criteria for the selection of outsourced manufacturers

1.0 Introduction Jot is a small unlisted company which designs and outsources the manufacture of a range of children’s toys. It has grown rapidly since it was established in 1998. It is currently experiencing manufacturing problems due to an earthquake affecting 2 of its outsourced manufacturers and also quality problems with another outsourced manufacturer. The quality of the company’s products, upon which its reputation is based, must not be compromised. The Jot brand name is known for quality toys but it is important that its products appeal to costconscious retailers and price sensitive customers. Jot can use the cost-leadership strategy, using Porter’s generic strategy framework, to select the minimum cost in its choice of manufacturers for products YY and ZZ. 2.0 Terms of reference I am the Management Accountant appointed to write a report to Jon Grun, Managing Director of Jot, a toy company, which prioritises, analyses and evaluates the