...Entertainmentnow.com Case Study Dr. Zelazny Accounting 3365.001 November 26, 2012 Group Members: Katherine Barr Jerrod Wesley Cameron Brenton Stalcup Emily Wenzlaff Company Overview/Main Case Concepts Entertainmentnow.com is an international Internet retail Website offering an array of books, music, videos, DVDs, toys, and small electronics. The company has historically marketed and sold to individual consumers, but has recently expanded their market to serve corporate and institutional customers as well. The company purchases products from vendors, holds the products in inventory, and then fulfills customer orders directly. This business model is similar to Amazon.com’s, making them one of the company’s main competitors. Entertainmentnow.com prides themselves on their superior customer service and is considered one of the world’s leading entertainment product retailers. To accommodate their growing business, the company recently spent a large amount of capital to improve the company’s technology and infrastructure. Because of these large capital expenditures, Entertainmentnow.com has seen negative returns for the past year. In order to please their stockholders and improve their operating performance, the company needs to expand their market share further. The major issue to be addressed in this case is the increase in net loss per item sold despite the fact that actual sales volume exceeded the company’s expectations. The operating budget for the past year...
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