Modern Yoga Manufacturers
Company summary and design of the value chain
As a student in the field of business, starting up a Sensory Yoga Mat Manufacturing Company has been my major plan. Fundamentally, the Yoga mats refer to specially designed or fabricated mats that are utilised as an aid during the yoga practice, thus preventing the hands and feet from slipping. The company will be named Modern Yoga Manufacturers Company. In this way, the Modern Yoga Manufacturers will involve itself in the design of the modern sensory yoga mats, which have sensors to measure the performance, power and strength of the user. Modern Yoga Manufacturers will, therefore, have a significant competitive advantage about the unique nature of the products it intends to offer.
While it is evident that the goods that Modern Yoga Manufacturers plans to produce will grant it a competitive advantage over other companies that provide normal yoga mats, internal financial management, value chain management, and budgeting will be an important aspect and feature to be significantly considered. With the specific emphasis on the value chain, Modern Yoga Manufacturers will design or create the value chain through the acquisition of the raw materials and consequently using them to produce something useful. Ideally, this process involves changing the business inputs into outputs in a way that they have substantial value than the initial cost of creating such productions. Modern Yoga Manufacturers will, therefore, have its retailers supply a range of products and then distribute them to the consumers in the most convenient and reliable way. While it is evident that the designed value chain may be assumed to have greater benefits, both to the company, retailers and the consumers, the Porter’s Value Chain technique will be used to analyse and examine all the activities within the enterprise, and their interconnectedness (Bischoff, 2011). As such, various primary and secondary activities such as inbound logistics, operations, outbound logistics, service, marketing, infrastructure, human resource management and procurement will all be considered.
Type of budget
Modern Yoga Manufacturers will use an operating budget in its budgeting activities. Fundamentally, this type of budget refers to a forecast, analysis and examination of the projected income and expenses over a given period (Touche, Opkin, & Halpin, 2013). Because Modern Yoga Manufacturers will intend to create the real and accurate picture that reflects it internal and external aspects, this budget will account for various factors, which include the sales, production and the overhead manufacturing costs. Besides, other costs such as those related to the administration will also be captured under the operating budget.
The production of the sensory yoga mats will take place in continuous mechanisms throughout all days of the week. In this sense, the operating budget will be created on a monthly basis, and the managers will be required to conduct a comprehensive comparison of various monthly reports to determine whether the company is spending much on supplies. Such comparison will also facilitate continuous budgeting throughout the years and ultimately plan and adjust in the event of any variations in the revenue.
Benchmarking
Manufacturing companies utilise benchmarking as a mechanism to compare various primary metric to compare themselves to other businesses (Weygandt, Kieso, & Kimmel, 2010). In this case of this company, Modern Yoga Manufacturers will gain an oversight in the manner in which it performs and further identify strategies it can use to become more competitive within the sports industry. Due to the broad differences in the investments of resources and the possible results in different organisations, the Modern Yoga management will have to make decisions and ultimately identify the appropriate benchmarking to utilise. However, the following types will be significantly considered;
i. Internal benchmarking-This refers to the comparison of the business activity to another similar process within the organisation. Internal benchmarking will provide the valuable insights about business economics, costs, and further investments options (Weygandt, Kieso, & Kimmel, 2010).
ii. Competitive benchmarking- this type refers to the direct comparison of products, processes and services of one company to another. This benchmarking will promote technology, and innovation within the organisation, thus able to adapt to the future trends (Weygandt, Kieso, & Kimmel, 2010).
iii. Functional benchmarking- refers to the comparison of the similar identical functions, activities and practices within similar organisations in the same industry. Functional benchmarking will enhance efficient functional analysis, the formation of good structures and good leadership strategies (Weygandt, Kieso, & Kimmel, 2010).
iv. Generic Benchmarking- This approach involves a broad conceptualization of various unrelated business activities practised in similar mechanisms in different organisations (Weygandt, Kieso, & Kimmel, 2010). This type will offer the valuable insights regarding the best practices and process excellence.
Cost system
A costs system refers to a framework used by organisations to carry out the estimation of the cost of their products (Drury, 2006). Fundamentally, this is done for profitability analysis, cost control and inventory valuation. Notably, the estimation of the accurate cost of products within this organisation will be an important step. For efficient performance, Modern Yoga Manufacturers will use the process requiring as its key cost accounting system. This method facilitates the accumulation of the manufacturing costs separately for different processes within the company (Drury, 2006). Besides, process costing will be essential for the production of the sensory yoga mat as different departments will be involved.
References
Bischoff, A. L. (2011). Porter's value chain and the rea analysis as an accounting information system. Place of publication not identified: Grin Verlag Ohg.
Drury, C. (2006). Cost and management accounting: An introduction. London [u.a.: Thomson.
Touche, B. L., Opkin, M., & Halpin, J. (2013). The budget-building book for nonprofits: A step-by-step guide for managers and boards. San Francisco, Calif: Jossey-Bass.
Weygandt, J. J., Kieso, D. E., & Kimmel, P. D. (2010). Managerial accounting: Tools for business decision making. Hoboken, NJ: Wiley.
