This material may consist of step-by-step explanations on how to solve a problem or examples of proper writing, including the use of citations, references, bibliographies, and formatting. This material is made available for the sole purpose of studying and learning - misuse is strictly forbidden.1. Introduction
This report presents an analysis of the expansion options for the company Killer Squid Blades. The company has been using the strategy of selective distribution so as to maintain a high-profile brand image. As one of its key customers is moving out, the company needs to formulate effective strategies so that it can expand without losing the exclusivity associated with the brand. It is confronted with two options –
• US market expansion
• Online expansion
Both the options have their own sets of advantages and benefits and an incremental cost-benefit analysis has been conducted to determine the best option for the company.
2. Cost-benefit analysis
The company has two options and it needs to consider the incremental costs and benefits due to each options. This is because this would help to analyze the additional profitability that would result from implementation of the decision. Therefore, the existing fixed costs and interest paid on loan are treated as irrelevant costs and not considered for the purpose of decision making since this would be incurred even if the expansion options are not undertaken. The factors of interest are...