Breakup of variable costs:

1. Raw materials
2. Manufacturing costs
3. Distribution costs
4. Marketing
5. Customer support
Business Case
1. Customer
a. Segments
b. Growth rate
c. Contribution to total demand
d. Distribution channels preferred
2. Product
a. Qualitative
b. Why do people buy it?
c. What exactly is it?
d. Service or commodity? How flexible are we Coffee
bean manufacturer vs Starbucks
e. Complementary goods If its market gets beat up, my
market is also affected
f. Substitution goods Indirect competitors (MBA vs Online
MBA)
g. Product life cycle Cars
3. Company
a. What are we good at?
b. Existing distribution channels
c. Costs breakup
d. Barrier to entry (if fixed costs are high)
4. Competition
a. Market share
b. Monopoly/Oligopoly/Highly competitive
c. Competitors behavior
d. Regulatory environment
e. Cyclical business?
Guesstimates
Revise product life cycle