Sylvia Strohm has decided to open her own dog grooming service, Puppy Scrub. She is trying to decide whether she wants to offer services doing mobile grooming or have a set location for the dog grooming business. She has analyzed cost and pricing information for both options and has arrived at the following financial data:
a. What is the total cost per dog-grooming service under the Mobile Option?
b. What is the total cost per dog-grooming service under the Set Location Option?
c. What is the ROI per dog-grooming service under the Mobile Option?
d. What is the ROI per dog-grooming service under the Set Location Option?
e. What is the markup percentage per dog-grooming service under the Mobile Option?
f. What is the markup percentage per dog-grooming service under the Set Location Option?
g. What is the selling price per dog-grooming service under the Mobile Option assuming Sylvia uses a cost-plus pricing model?
h. What is the selling price per dog-grooming service under the Set Location Option assuming Sylvia uses a cost-plus pricing model?
i. Using the current market price per dog-grooming service for the Mobile Option, what is the target cost for Puppy Scrub?
j. Using the current market price per dog-grooming service for the Set Location Option, what is the target cost for Puppy Scrub?
k. Which option would you recommend to Sylvia for opening her new dog-grooming business? Explain why.
Correct Answer:
Verified
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