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# Operation Management : BIC Company

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## Audrey Mandefield

on 29 March 2013

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#### Transcript of Operation Management : BIC Company

Breakeven Point of BIC company
for 2010, 2011, and 2012 Forecasting Productivity Break Even Point Company
Presentation Formulas: BEP€ = Fixed Costs/ %CM
2010: BEP = 1395E
2011 : BEP = 1341E
2012 : BEP = 1381E Break Even Point - The Calculation of the Break Even Point is important for the performance and the profitability
- The Break Even Point allows company to control if the product strategy is good
- BEP is the amount of Sales which allow the company to cover its fixed costs, so the contribution margin is equal to fixed costs. Operations We studied the Sales Forecasting on the medium term ( year by year) Sales Forecasting Unit sold in billion 2012: 8,663
Variable cost in million €: 933.3
Variable Cost average per unit: €0.11
Sales in million €: 1,898.7
Price average per unit: €0.22

BIC Company, at this level, its total costs were equal to its sales for all segments (consumer business & advertisement) worldwide. Explanation 1) Presentation of the Company
2) Productivity
3) Break Even Point
4) Forecasting
5) Conclusion Summary Presentation of the company BIC activities & brands:
Stationery
Lighters
Shavers
Promotional products
Other products: specific products such as the BIC phone, batteries and pantyhose… Presentation of the Products Multifactor Productivity= output / labor+material+energy+capital+miscellaneous
Multifactor productivity calculation : Multi-factor Productivity Management Resources Forecasting includes all the planning tools that allow managers to run the business efficiently
Most companies use the classical electronic tools such as the enterprise resource planning (ERP) and electronic data interchange (EDI) networks, advanced supply chain management systems, and other Web-enabled technologies
These tools enable the company to follow the variations of the production cycle, the product life cycle & the supply chain management. Planning Tools Conclusion Bic’s operations management strategy is well established, whether it is for its productivity, its forecasts or its break-even point.
BIC always reached its objectives in terms of break-even point
Bic owns a good ERP process that allow the company to have good forecasts
We strongly encourage the company to keep investing in ERP as it is a valuable asset for a good management of its inventories
BIC has to be careful about the change in anti-dumping regulation on lighters : Bic contribution margin depends on lighters by 40
We encourage BIC to develop his presence on the emerging countries Alix Emylia
Daram Rachel
El Hamyani Lamya
Mandefield Audrey
Turon Marine
Ye Frank Sources Bic manufactures 5 million lighters everyday All segment 2012 Break-Even Analysis 2013 -The growth of sales for all segment would be 3 %, the unit sales for 2012
- We take the same Variable and Fixed Cost of 2012 to calculate the Break Even Point

in million Euro Output (in units produced) Operation Management, Mike Pycraft, 2000
Operation Management : An International Perspective, David Barnes, 2008
Operation Management, Producing Goods and Services, Donald Waters, 2002
Operations Management. 5 Edition. Trans-Atlantic Publications,Nigel Slack, 2007.
Operations Management, 9th Edition. Mcgraw Hill Higher Education,William Stevenson, 2006.
Bloomberg Labor productivity Computing the labor productivity allows BIC to know how the outputs can cover the cost of inputs.
Labor productivity = number of units / workforce * hours worked

Direct labor productivity of BIC company for 2009, 2010, 2011, and 2012 BIC was founded in 1945 by Baron Marcel
BIC culture:
Simple: BIC make the consumer’s life easier.
Inventive
Reliable: BIC ensures quality & safety
For everyone, everywhere
BIC World Position
BIC Sales in 160 countries, on every continent
Over 3.2 million retail outlets sell BIC products.
BIC has 9,200 employees around the world First, we can notice that BIC Sales has increased since 2009 in spite of the economic crisis. Between 2009 and 2010, the Sales increased by 14.67% while they have decreased by 0.41% between 2010 and 2011. positive growth rates of multifactor productivity multifactor productivity in Bic production declined by 24,88% between 2009 and 2010 : both output and inputs decreased between this two years.the multifactor productivity ratio increased by 39, 80% between 2010 and 2011 Exponential Smoothing method
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