Our client Moldovan Coffins is a high-end coffin maker in the country
Our client Moldovan Coffins is a high-end coffin maker in the country of Moldova. Moldova, legally the Republic of Moldova, is a landlocked country in Eastern Europe located between Romania to the west and Ukraine to the north, east, and south. Moldova declared itself an independent state with the same boundaries as the Moldavian Soviet Socialist Republic in 1991 included in the dissolution of the Soviet Union. The total human population of the country amounted to 4 million (2004 Moldovan census).The owner of Moldovan Coffins business has seen substantial difference in his market in recent years and is also contemplating the future of his business. Up until now, this individual has been in the company of building high-quality, hand crafted coffins largely by palm with an experienced labor push. Recently, however, he has become aware of a new technology that would allow him to build machine-made coffins with much less labor. Should this individual invest in the brand new technology? And should he even remain in the coffin-making business in the first place? For what reason or really want to?Issue #1: What strategic alternatives should the owner of the coffin business consider?Issue #2: Now make the prospect calculate the industry size, giving them the pursuing data: Population of Moldova: 4 million Population Expansion: 0% Average Life Expectations: 75 years Age Syndication: assume a set time distribution, i. e. same number of men and women each and every age. Burial Practices: 75% of deaths are buried in coffins.Issue #3: Now make the prospect calculate the value of Moldovan Coffins’ business, giving them the pursuing data:Price – Coffins are priced at $5, 000 for a hand-made high-end coffin.Costs – Material accounts for 10% of the direct cost, while labor accounts for the other 90%. COGS is $4, 800 every coffin. Fixed costs for the business are $700, 000 per year. Presume all assets are totally depreciated and ignore income taxes.Competition – The customer Moldovan Coffins has a 10% market share and a family member market show of about 1 (if asked, you may describe that relative market talk about is exactly the business market share to that of its nearest rival. )Market Trends, Legislation, and so forth – If asked about any exogenous factors, simply notify the prospect to envision the market is expected to continue as it currently is.