Question

Ramiro​& Sons buys​ T-shirts in​ bulk, applies its own trendsetting​ silk-screen designs, and then sells the​ T-shirts to a number of retailers.

Ramiro wants to be known for its trendsetting​ designs, and it wants every teenager to be seen in a distinctive Ramiro​T-shirt.

Ramiro presents the following data for its first two years of​ operations,2012 and 2013.

		2012	2013
1	Number of T-shirts purchased	225,500	257,000
2	Number of T-shirts discarded	20,500	24,000
3	Number of T-shirts sold (row 1 - row 2)	205,000	233,000
4	Average selling price	$32.00	$33.00
5	Average cost per T-shirt	$17.00	$15.00
6	Administrative capacity (number of customers)	4,700	4,450
7	Administrative costs	$1,739,000	$1,691,000
8	Administrative cost per customer (row 7 / row 6)	$370	$380

.	Is RamiroRamiro​'s strategy one of product differentiation or cost​ leadership? Explain briefly.
2.	Describe briefly the key measures RamiroRamiro should include in its balanced scorecard and the reasons it should do so.

Answer 1

1) Ramiro & Sons is opting a product differentiation strategy. The designs of Ramiro are “trendsetting,” its T-shirts are distinctive, and it targets to do production of its T-shirts a “must have” for all the teenagers. It demonstrates the product differentiation strategy, and to succeed, Ramiro need to continue the hard work to innovate and be able to charge a premium price for the product

2) The key measures Ramiro need to include in its balanced scorecard are as follows:

Customer Perspective:

-- Distinctive market share, name-brand Ramiro​'s T-shirt

--customer satisfaction, and increasing the new customers,

--increasing the count of mentions of Ramiro’s T-shirts in the leading fashion magazines

Financial Perspective:

-- Will be able to increase the operating income from charging higher margins

-- Charge premium price on products

Internal Business Process Perspective:

--Quality of silk-screening (use of glitter, wide use of colors, durability of the design),

-- New designs frequency,

-- Time between concept and delivery of design

Learning and Growth Perspective

-- Better ways to attract and retain talented designers

-- Enhancement in silk-screening processes,

-- Continuous learning in the marketing skill levels

-- Employee satisfaction