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Kanthal Case. Kanthal Case Executive Summary Over the years Kanthal has used its
traditional accounting management system to cost its products. ...
... Kanthal case study : The case of the Swedish company kanthal shows how important
an efficient account management system is for a small company which has many ...
... 4. Study case Exhibit 9. It shows that about only 50% of its ... Unprofitable orders
should be accepted while Kanthal is reviewing how to address unprofitable ...
... 1. Major Issues and General Scenario General Scenario: Kanthal is a successful and
profitable company that is a worldwide market leader in ... 2. Case Questions 2.1 ...
... C'mon, what kind of pleasure do you expect from a 500 pages book with very small
fonts? I would like to review on pages 183-189 regarding case at Kanthal. ...
Submitted by hj08 on March 13, 2008
Category: Business
Words: 2998 | Pages: 12
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Popularity Rank: 22,350
Average Member Grade: A (Add a Comment / Grade this Paper)
Kanthal Case
Executive Summary
Over the years Kanthal has used its traditional accounting management system to cost its products. In 1985, when Carl-Erik Ridderstrale became president he developed the Kanthal 90 plan to increase overall profitability. He quickly recognized that in order to implement this plan a new account management system was needed to supplement the new strategy. In lieu of this need a new account management system was devised.
Under the new cost system, two broad sources of costs were identified: manufacturing and SM&A. All costs within these categories were reclassified as either volume driven or order driven. Hence, four cost pools were set up.
The implementation of the new system had some limitations and challenges:
- The validity of the costing under the new cost system
- The market dynamics and how they would impact implementation
- Danger of losing customers for stocked items
- The applicability of the new system across borders
Moreover, the new cost system revealed that two large volume customers that were unprofitable. These customers were analyzed and recommendation made on the course of action.
Introduction
Kanthal is the largest of the six divisions in the Kanthal-Hoganas group of Sweden specializing in the production and sales of electronic resistance heating. Headquartered in a town near Stockholm, Kanthal has a product range consisting of 15,000 items supplying to about 10,000 customers. During the period of 1985 to 1987 it had steady sale revenue of SEK (Swedish Kroner) 850 million each year. Export sales accounted for 95% of total sales. Kanthal consisted of three divisions:
- Kanthal Heating Technology division supplied products like heating wire and ribbon, foil elements, machinery and precision wire. Kanthal was a world leader in supplying heating alloys with a market share of 25%.
- Kanthal...
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Kanthal CS, April 12, 2008
Grader: nsn3, Grade: A
Studied the same paper.
Great approach solving the case, especially the point of how to turn unprofitable customers into profitable ones.