【正文】 products?It costs approximately $ to manufacture a bag of private label cookies which will sell for $ to retailers. It costs approximately $ to manufacture a bag of branded cookies which will sell for $. q How do the same numbers translate at the retail level?A retailer, paying $ for private label cookies can sell that product for $. The $ bag of branded cookies can be sold for $.The key finding is that from a costpricemargin perspective it is advantageous for both the manufacturers and the retailers, with all else equal, to sell a bag of branded cookies. Other factors must be contributing to the demand for private label cookies. Think about the incentives at each level in the chain (manufacturer, retailer, consumer). The following questions can help fill in detailsq Have any of the manufacturers been able to gain additional shelf space for branded products by supplying grocers with private label products?Noq Has their been excess capacity at your client, its main petitor or the smaller petitors that has been used up through the manufacturing of private label products?There was some excess capacity at the smaller petitors and your client’s main petitor (your client is unsure as to how much).. There is little excess capacity anywhere in the industry today..q Has your client’s relationship with its retailers suffered as a result of it not supplying private label products?Not noticeablyq Are grocery stores using private labels in other food categories?Yes, there has been a major push by grocery stores to populate shelves with private labelsq Is petition increasing or decreasing among grocers?Generally increasing. Grocer chains are expanding and the number of grocers to be found serving a given area has generally increased over the past five yearsq What general macroeconomic trends have occurred over the past five years?The economy has been slowing over the past five years. There is concern about recessionThe above information begins to expose a clearer story. A number of factors have contributed to the emergence of the private label segment: manufacturer’s interest in utilizing excess capacity, grocer’s desire to sell products with their name on it (they may believe this creates return customers in an increasing petitive environment), consumers concerns about a troubled economy (price vs. quality tradeoffs). At this point the candidate would be encouraged to state what they believe the magniturde of the private label threat to be to the client. There is no right answer. One can argue either way. If the threat is seen as high, the likely remendation is for your client to begin supplying private label products. The candidate should recognize that in peting in the private label segment, the basis of petition is primarily cost. At the same time, the client’s branded product should be protected. The following tactics might prove appropriate:q Seek to wring costs out of all phases of the operation216。 Make it difficult to copy product: innovate wisely through product advances, smart product line extensions, frequent changes to the product216。 Contractors are a group of outside Supervisors and Craftsmen who support your client during times of high workload. They also are capable of performing any maintenance job that may arise, but differ from your client’s Craftsmen in that they divide the collective skills required into five designations rather than twelve. Thus, the craftsmen of the contractor are capable of performing a broader set of skills. They, like your client’s craftsmen, don’t perform skills outside of their defined craft but do allow different craft designations to help each other. There are an average of 7 contractor Maintenance Supervisors and 140 contractor Craftsmen at the refinery on any given day. Question:q What opportunities exist to increase profits?q What remendations can you make to capture savings related to the identified opportunities?q What are the cost savings associated with your remendations?Suggested solutions:The first question involves identifying opportunities to improve profits. The candidate must start with either revenues or costs. Although one could make the argument that maintenance supports revenue by maximizing the operating time of the refinery equipment, maintenance should be seen to be a support function. Thus, it is more appropriate to focus on costs and cost reduction. The following questions will help the candidate gain insight into cost reduction opportunities. q How does the maintenance department track its costs?If the candidate phrases the question about material or overhead costs, the interviewer would inform the candidate that detailed reviewed showed no major opportunities. The candidate would be steered toward labor costs and given the following tables regarding maintenance labor costs for the past year. To support understanding of the following tables, Turnaround work is long term preventive maintenance (. plete rebuilding of a boiler) that may be performed once every few years. All other work (short term emergency repairs, small scale preventive maintenance, other routine work, etc.) fits into the category of Daily workCraftsmenDaily workTurnaroundTotalClient$ 8MM$ 2MM$ 10MMContractor$ 5MM$ 9MM$ 14MMTotal$ 13MM$ 11MM$ 24MMSupervisorTotalClient$ 1MMContractor$ Total$ Since the Craftsmen table represents a larger dollar amount than the Supervisor table, it is logical to pursue cost savings opportunities in this area first.q What is the utilization of Craftsmen in the assets? In central maintenance? And for contractors?Assume each area is utilized 100% of the time, 50 weeks per year, 40 hours per week. q How does the labor cost of craftsmen ($24MM) on a refinerysized basis (., $cost / per barrel of crude oil processed) pare with industry averages?Consulting your industry data base shows that cos