<p>Part 1</p>
<ol>
<li>Analyze historical growth and brainstorm growth strategies</li>
</ol>
<p>Organic:</p>
<ul>
<li>Increase penetration with US military</li>
<li>Product development – develop new products for the military</li>
<li>New market entry to new markets or customers</li>
<li>Increase / reduce prices (based on demand elasticity)</li>
</ul>
<p>Inorganic:</p>
<ul>
<li>Joint Venture – to increase market accessibility or product offering.</li>
<li>M&A – add additional capacity and/or products.</li>
</ul>
<p>Part 2a
2a. Explore attractiveness of prototype products</p>
<p>To calculate the revenue for each scenario, the interviewee should add Assessor sales to the sales of the new product.</p>
<p>Assessor sales are based on:</p>
<ul>
<li>50 units sold with no new product launch</li>
<li>Cannibalization forecast specific to each new product launch</li>
<li>$110,000 per aircraft</li>
</ul>
<p>New product sales can be easily calculated using shortcuts. For example:</p>
<ul>
<li>SeaBird: $220k * 100 = $22m… then half of this</li>
<li>SandBird: $210k * 100 = $21m… then half of it and add (10% of $21m)</li>
<li>JointBird: Add to get 90… then $180k*100 = $18m, subtract (10% of $18m)</li>
</ul>
<p>Part 2b
2b. Explore attractiveness of prototype products</p>
<p>The introduction of a new aircraft will have a negative impact on Assessor sales. Which aircraft should Dark Sky produce?</p>
<p>Assessor Sales (Units, Revenue):</p>
<ul>
<li>No new product = 50 aircraft, $5,500,000</li>
<li>With SeaBird = 50 + (50 * (-40%)) = 50 - 20 = 30 aircraft, $3,300,000</li>
<li>With SandBird = 50 + (50 * (-70%)) = 50 - 35 = 15 aircraft, $1,650,000</li>
<li>With JointBird = 50 + (50 * (-90%)) = 50 - 45 = 5 aircraft, $550,000</li>
</ul>
<p>New Product Revenue:</p>
<ul>
<li>SeaBird = 50 * $220,000 = $11,000,000</li>
<li>SandBird = 60 * $210,000 = $12,600,000</li>
<li>JointBird = (38 + 52) * $180,000 = 90 * $180,000 = $16,200,000</li>
</ul>
<p>Total Revenue:</p>
<ul>
<li>Assessor Only = $5,500,000</li>
<li>Assessor and SeaBird = $3,300,000 + $11,000,000 = $14,300,000</li>
<li>Assessor and SandBird = $1,650,000 + $12,600,000 = $14,250,000</li>
<li>Assessor and JointBird = $550,000 + $16,200,000 = $16,750,000</li>
</ul>
<p>Part 3
3. Brainstorm other product selection considerations</p>
<p>Development</p>
<ul>
<li>Speed: How quickly could Dark Sky start manufacturing a third model (i.e. can Dark Sky produce SandBird this year, and be producing SandBird and SeaBird the following year)? If so, what are the revenue implications?</li>
<li>Costs: How profitable are the four aircraft models in comparison? Note: Because Dark Sky has a Cost-Plus-Fixed-Fee contract, profitability for each aircraft is likely equivalent. For this reason, Dark Sky should focus on maximizing the number of aircraft sold. • How much and how long is the payback period for the investment in manufacturing each type aircraft?</li>
</ul>
<p>Portfolio</p>
<ul>
<li>If Dark Sky produces JointBird, is $550,000 in Assessor revenue worth the associated cost to produce the aircraft? Should resources be allocated to another project?</li>
</ul>
<p>Customer</p>
<ul>
<li>Potential benefits of have two customer bases for new product (Navy and Army).</li>
</ul>