Free Essay

Walker Books

In: Business and Management

Submitted By abixplorer
Words 1017
Pages 5
MAB Lecture Illustration: Walker Books Profit Planning Exercise

Walker Books1
Along with his brothers, Ramsay Walker ‘inherited’ Walker Books (Walkers) from his father. Neither
Ramsay nor his brothers had worked full-time in the business. He has spent the last few months becoming familiar with the business. Exhibit 1 highlights Walker and Company’s organizational structure. Ramsay held meetings with the senior staff as well as studying the state of the industry, in general. Ramsay knew the industry was undergoing change: larger publishing houses getting larger through acquisitions and dominating the market; the rapid impact of technology through developments like e-readers; and the financial difficulties confronting some of the major retailers such as Borders2.
Moreover, the size of the United States market seems to have stalled with total US sales estimated at
$23.9b in 2009 compared to $24.3b in 2008; while over the last seven years the industry had experienced a compound annual growth rate of 1.1%3. As a result of his investigations Ramsay developed the corporate strategy and operational plans as follows:
1. The need for a new overall corporate strategy to drive the business combined with a small number of key financial targets
2. The need to develop a number of targeted business strategies to facilitate the execution of the corporate strategy
3. A better planning and budgeting system to facilitate financial analysis of alternate action plans, that when developed, will serve as a management accounting control and evaluation tool.
Each of these is briefly outlined below:
1. Corporate Strategy and Key Financial Targets
Ramsay was clear, that as a niche operator in the book industry, the focus had to be on differentiation. He knew Walkers lacked the economies of scale of the larger publishing houses.
High quality books supported by strong marketing and sales support would be paramount. Ramsay decided to set the following financial targets:
a. Achieve Free Cash Flow numbers of $250 000 next year, and $500 000 and $1m in the subsequent two years. He hoped this might be achieved through improvement in net income and better working capital management.
b. Return on assets (ROAs) of 10%. He based this on the idea that the larger publishing houses seemed to be generating ROAs of 12-15%.
2. Targeted Business Strategies
This strategy of differentiation would be executed through:
a. Publishing fewer books in fewer segments with a view to [re] directing more resources to the Children’s Book segment. Figure 1 contains some summary data and Appendix 1 contains more detailed income statement data relating to all book segments. Ramsey has already decided that Walkers would stop publishing the Western’s Book category.
b. Building better relationships with key authors
c. Build better relationships with suppliers and other key participants in the industry value1

This case is based on the case study Walker and Company: Profit Plan Decisions published in Simons 2000.
In February 2011, Borders was reported to be in preparation for filing for bankruptcy protection under Chapter
11 (The Wall Street Journal supplement, The Australian 14 February). This would impact the Australian stores as well as the Angus and Robertson group.
3
The Association of American Publishers, April 2010.
2

1|P a g e

MAB Lecture Illustration: Walker Books Profit Planning Exercise chain. d. Strong, targeted marketing campaigns particularly around key titles
e. Where applicable, embrace the technology, particularly with respect to distribution and the development of e-readers.

Figure 1 Summary data: Walker and Company Book Segments
Nonfiction
Mystery
Westerns

Religious and Children’s inspirational books

Average new titles per year

20 in hardcover and paperback

20-14 in hardcover only

6-8 in hardcover

14-17 only in paperback Current distribution form

Primarily bookstores Public libraries and specialty stores Public libraries

Religious book retailers and wholesalers 25-30 in hardcover; 5-8 in paperback
General and specialized retail bookstores, wholesalers and schools 3. Profit Planning and Budgeting
Ramsey believed that Walkers needed a much better planning system to help guide strategy implementation, assess the viability of alternate courses of action and feed the annual budget. He was happy with his financial targets. Now he needed a plan to get there. Dropping the Westerns segment was the first move in this regard. He felt this might free up some editorial capacity which could be better used elsewhere (on average each editor is able to manager 11.5 new releases annually) and assist with not carrying unnecessary inventory which would ease working capital considerations. Ramsey also recognized the relationship between fixed and variable costs as all
COGS and one third of operating expenses were variable. He knew that dropping the Westerns segment would mean that the remaining fixed expenses would have to be re-allocated to other lines or reduced.
Moreover, Ramsey had decided there would be a greater focus on Children’s books. He decided this for a number of reasons. First, Children’s Books represented around 40% of the total revenue (see
Appendix 1) for the company. Second, focusing on Children’s Books would complement the need to remain a niche participant in the industry. Third, Ramsey felt that Children’s Books might be less affected by the e-reader technologies, at least in the short-term. The current research showed that most e-reader purchasers were thirty-five and above.
Still, Ramsey wondered:
1. What mix of categories should he pursue within the Children’s Book segment?
2. Should any categories be dropped? How many? Which ones?
3. Given a decision on mix, how many new titles of each should be pursued annually, and do we have the editorial resources to manage this?
4. What impact will these decisions have on the financials? Can we meet out financial targets?
What costs are avoided by dropping or reducing some Children’s categories?

2|P a g e

MAB Lecture Illustration: Walker Books Profit Planning Exercise

3|P a g e

MAB Lecture Illustration: Walker Books Profit Planning Exercise

APPENDIX 1: Walker Books: Segment Income Statement

4|P a g e

MAB Lecture Illustration: Walker Books Profit Planning Exercise

APPENDIX 2: Children’s Books Segment by Category

5|P a g e

Similar Documents

Premium Essay

Walker Books

...According to our group’s analysis, it is determined to drop Western segment from production lines for a couple of reasons. Firstly, the external factor to drop Western segment is that Walker Books needs to prepare funds to invest on E-book production development since digital revenues are replacing tradition book revenues and Walker Books needs to start E-book business to prevent losing revenue from lack of online sales.(Appendix 5) Thus, after dropping Western segment, Walker Books will be able to spend variable costs associated with Western segment on developing E-book production. Second, the internal main factor for dropping Western Segment from production line is because dropping Western Segment has the least opportunity cost to drop in order to prepare funds for investing on E-book development based on our assumptions and analysis. Our group members concluded that Western segment has the least possibility to improve its net profit in comparison with other segments in the future. In spite of the fact Children’s Books and Mystery segments make more losses than Western segment does, we determined that Western segment will not generate much profit in the future with expense management in the future due to the small amount of gross regular sales while we inferred that net profits of Children’s Book segment and Mystery segment can greatly improve if they undergo expense management in the future thanks to their a lot of gross regular sales. b) According to Ramsay’s......

Words: 375 - Pages: 2

Premium Essay

Walkers Book

...analysis. Explain how Walker Books might use CVP in decision making. In your discussion, make sure you provide examples relating to Walker Books. (300 words) | Picture | Photo | B+W | Nonfiction | Fiction | Backlist | Unit Contribution Margin ([Total revenue-Total variable cost]/Number of units) | 1.67 | 1.57 | 1.03 | 1.81 | 1.81 | - | Profit ([Unit Contribution Margin*No of units] – total fixed cost) | -$26,642 | -$23,586 | -$24,441 | -$13,619 | -$3,738 | - | Net Profit Margin (Net Profit/Total Revenue) | -7% | -11% | -18% | -7% | -6% | - | Market Share | 18% | 11% | 7% | 9% | 3% | 52% | According to the CVP analysis, profit can be calculated by multiplying unit contribution margin and number of units minus total fixed costs. In this case, we assume that COGS and shipping/ warehousing/ order processing expenses are all variable even though a portion of it is fixed, since vendors often charge a certain fee to gain access to their services. Royalties are assumed to be variable cost as it is a usage-based payment. By determining the profit, it allows us to decide whether to continue or drop the book line. Based on the profit figures, we think that it will be best to drop the picture book line since it is the least profitable. However, it has the highest market share which shows that there are still a high percentage of people purchasing books from the segment (Picture) therefore we assume that profit will increase if we were to increase the number of book titles. All......

Words: 499 - Pages: 2

Premium Essay

Mab Walkers Book

...might use CVP in decision making.  In your discussion, make sure you provide examples relating to Walker Books. Figure 1 Formulas Picture Photo B+W Non-Fiction Fiction Unit Contribution Margin ([Total revenue-Total variable cost]/Number of units)     2.26       2.21        1.76       2.41       2.37 Profit ([Unit Contribution Margin*No of units] – total fixed cost) -$26,642     -$23,586       -$24,441   -$13,619   -$3,738   Net Profit Margin (Net Profit/Sales) -7% -11% -18% -7% -6% These figures calculated are taken from the year 2012 to help aid our decision making for the year 2013. Unit Contribution Margin (UCM) refers to the profit earned per unit without taking fixed costs into consideration. The figures shown in Figure 1 show that Picture, Non-Fiction and Fiction segments are doing better as their UCM are at a higher range as compared to Photo and B+W segments. Profit refers to the final income of the Company after taking fixed costs into account. By determiningprofit or loss, it will allow us to decide whether to drop or continue the book line. The figures shown above show that Picture, Photo and B+W segments are making higher losses as compared to Non-Fiction and Fiction segments. The UCM for the respective segments are relatively low (e.g. earning $1.67 per unit excluding fixed costs). Hence, the Company ended up making losses after taking fixed......

Words: 362 - Pages: 2

Premium Essay

Walkers Appeal Book Review

...Walker’s Appeal: Book Analysis Walker's Appeal was an desperate cry and plan to awaken others blacks in America to the evils of the so-called Christian whites that were mistreating them. The appeal was actually called Appeal to the Coloured Citizens of the World. The appeal lifted the veil of injustice and tyranny covered so long by the blacks in America who had became servile and mentally dead. It was an emotionally centered, powerful antislavery pamphlet published by David Walker in September 1829 and sparsely allocated across the South. Although Walker himself was born free, taking the legal rank of his mother, he was deeply troubled by the slave status of his father. His father was born subjected, and enslaved by whites and died before Walker was born. His father’s experience as well as the oppressive hell-like conditions inflicted on by the "so called Christians" as he refers to whites throughout the book, enabled his ideology of blacks in America being the most degraded, wretched and abject set of beings since the world began. Throughout the book Mr. David walker desperately tries to "awaken" the black people of America from the deep emotional and mental sleep brought on by the great evils of the deviated Christians. Mr. Walker exclaims “Can our condition get any worst? can it be more mean and object?"(pg.14.) Within this book he opens my eyes to the suffrage of the people whom which I as a black woman in America share my blood and genetic make-up with. Within this...

Words: 587 - Pages: 3

Free Essay

A Friendly Neighbour

...this short story there is an ongoing conflict between the two neighbours Roger, and Frank Walker, which quickly evolves into and direct war between the two neighbours. Roger continuous to take a step further to prevent the evil deeds he anticipate his enemy to do, which leads to some pretty grim stuff, including family wonking and ending with a possible unintentional family slaughter. The main character Roger is seemingly paranoid, mostly at the end of the text. "[…] And I answered myself: What I would do is look around my house in a frenzy for something else dangerous, such as paint, such as thinner, such as household chemicals, and then either ring the house of my enemy with the toxics and set them on fire or pour some into the pool of my enemy […]” (p. 3 ll. 24 -27)s, he truly fears the evil of his not so friendly neighbour Frank Walker. He sort of imprison himself in his house, but mostly his children which are to stay indoor when the neighbour is at home, and besides that is he locking his doors just in case his enemy of a neighbour should get any funky ideas. Roger is rather aggressive in the sense that he quickly draws to weapon and wonks his neighbour before asking any questions. His perception of his not so friendly neighbour is that he is a lunatic who will take any chance he gets to hurt his neighbour and/or his neighbours’ family. Rogers anxiety for his neighbour Walker is clear near the end of the text, were he wakes up sweating in the middle of the......

Words: 680 - Pages: 3

Premium Essay

Alice Walker

...2013 Alice Walker Section 1 Biography According to Michael Mayer, Alice Walker, one of the best-known and most highly respected writers in the United States, was born in Eatonton, Georgia. She was the eighth and last child of Willie Lee and Minnie Lou Grant Walker. Her parents were sharecroppers, and money was not always available as needed. At the tender age of eight, Walker lost sight of one eye when one of her older brothers shot her with a BB gun by accident. This left her in somewhat a depression, and she secluded herself from the other children. Walker felt like she was no longer a little girl because of the traumatic experience she had undergone, and she was filled with shame because she thought she was unpleasant to look at. During this seclusion from other kids of her age, Walker began to write poems. Hence, her career as a writer began. Walker found the love of her life in 1967, a white activist civil rights lawyer named Mel Leventhal, and they married him in 1967. A year later she gave birth to their daughter, Rebecca. It was not until she began teaching that her writing career really took off. She began teaching at Jackson State, then Tougaloo, and finally at Wellesley College. Walker was involved in the Civil Rights Movement and spoke for the women’s movement, the anti-apartheid movement, for the anti-nuclear movement, and against female genital mutilation. She also started her own publishing company: “The Wild Trees Press”, in 1984. Walker......

Words: 2381 - Pages: 10

Free Essay

Color Purple

...The Color Purple Walker, Alice- 1982 Alexis Moss Alice Walker wrote The Color Purple (book titles in italics) to give her insight of men, women, love or the lack thereof, physical, mental, and verbal abuse. The men within this book were very powerful. It would be safe to say that the men were slave owners, and the women were the slaves. Celie was the main character of the book, and she endures every form of abuse from individuals in her life that should have been showing her love. Everyone abused her except her sister Nettie, whom she found herself trying to protect from their father. Celie’s mother abused and cursed her, even while being on her sick bed because her husband desired to have sex with Celie more than her. Walker uses this unique protagonist to comment on the racism, sexism, and abuse of women who was so prevalent in the early 1900s. Walker used Celie’s inner monologue (in the form of letters to God and her sister Nettie) to convey the overarching message of the novel; the power of finding that inner voice that leads to freedom from the oppression of society’s expectations. The plot takes place over a 30-year period in the reconstruction South of Georgia. They live in a rural farm community and were a hotbed of activity for civil rights and suffrage. This book was written from the other side of racism, from the victim’s point of view forcing the reader to see the result of bigotry. Racism not only affected Celie’s life but also the life of her friend......

Words: 778 - Pages: 4

Free Essay

Alice Walker

...Alice Walker: The Cost of Her Fame Professor Writers often have a way of awakening people’s inner thoughts; Alice Walker is one of those writers. Many people have been touched by her work, feelings rekindled and relationships restored. Walker’s dreams lead her to many new beginnings and sorrows. Walker’s greatest lost would be her most cherished bond – family. Alice Walker was born in Georgia, on February 9, 1944. Her father was a sharecropper and her mother was a maid. When Walker was eight, her brother accidently shot her in the eye with a BB gun. Unable to get medical treatment, she became blind in one eye and developed a scar. This accident left her feeling unattractive. She became withdrawn and turned to writing. The scar was removed when she was 14, which opened up her world from isolation. She became voted Most Popular, Queen of her Senior Class, and Valedictorian. She attended Spellman College, where Professor Howard Zin, a civil rights activist, influenced her. She transferred to Sarah Lawrence College, where she met Dr. Martin Luther King Jr. After graduating college, she married Melvyn Roseman Leventhal, a Jewish Civil Right activist. They had a daughter named Rebecca. Walker said her daughter was a “living, breathing, and mixed-race embodiment of the new America that they were trying to forge” (Driscoll, 2008). Walker is an advocate for the unheard and overlooked. She is an activist, often involved with organizations, Code Pink and Women for......

Words: 882 - Pages: 4

Free Essay

Pop Literture

...Popular Literature Paper James A. Jones SOC/105 12/11/2012 Mercedes Doris Ruiz Popular Literature Paper Beetle Bailey is an American comic strip created by cartoonist Mort Walker. The setting is a fictional Military base and is one of the oldest comic strips still running today. Walker created Beetle Bailey on September 4, 1950. He has been assisted by Jerry Dumas, Bob Gustafson, Frank Johnson and Walker’s sons Neal, Brian and Greg Walker. The characters in the strip were created after Walkers fraternity brothers at the University of Missouri. Beetle was a college student at Rock view University, he quit school in the first year and enlisted in the U.S Army on March 13, 1951 and has remained there ever since. Beetle Bailey is a sort of lazy private who just think he can sleep his way through the army, he always wears his headgear below his forehead so you never get to see his eyes, in the rare instance he is without headgear his eyes are covered by his hair he a misfit and suffers through constant physical and verbal abuse from his company sergeant and nemesis sergeant first class Orville P. Snorkel. Beetle Bailey was circulated in the stars and stripes newspaper which is a military paper to boost military morale but it was banned from the japan issue because it was said be disrespectful to officers. The civilian papers thought it was funny and it continues to run today. The stories change to fit the times but beetle is still a private and still wears the......

Words: 494 - Pages: 2

Premium Essay

Aaaaa

...Color Purple” by Alice Walker The Color Purple is an epistolary novel by American author Alice Walker which won the 1983 Pulitzer Prize for Fiction and the National Book Award for Fiction. It was later adapted into a film and musical of the same name. This novel is making arguments on the topic “racism and sexism”. The Color Purple is an extraordinary novel that’s full of surprises. Taking place mostly in rural Georgia, the story focuses on female black life in the 1930s in the southern United States, addressing numerous issues including their exceedingly low position in American social culture. Alice Walker’s biography [pic] Alice Walker was born on February 9, 1994, in Eatonton, Georgia. Living in the racially divided South, Walker attended segregated schools. She graduated from her high school as the valedictorian of her class. With the help of a scholarship, she was able to go to Spelman College in Atlanta. Later, she switched to Sarah Lawrence College in New York City. While at Sarah Lawrence, Walker visited Africa as part of a study-abroad program. She graduated in 1965—the same year that she published her first short story. After college, Walker worked as a social worker, teacher and lecturer. She became active in the Civil Rights Movement, fighting for equality for all African Americans. Her experiences informed her first collection of poetry, Once, which was published in 1968. Better known now as a novelist, Walker showed her talents......

Words: 2561 - Pages: 11

Free Essay

Bshs 422 Week 4 Learning Team Relevant Film or Book Report

...BSHS 422 Week 4 Learning Team Relevant Film or Book Report To Buy This material Click below link http://www.uoptutors.com/BSHS-422/BSHS-422-Week-4-Learning-Team-Relevant-Film-or-Book-Report Select one of the following books or videos, or another appropriate one of your choosing, to use in preparing and presenting a written report on the delivery of behavioral health services to a culturally diverse population: 1.     Raisin in the Sun by Lorraine Hansberry (book or film) 2.     “Mi Familia/My Family” (film) 3.     The Color Purple by Alice Walker (book or film) 4.     The Joy Luck Club by Amy Tan (book or film) 5.     A Time to Kill ( film) 6.     Crash (film) 7.     “American Me” (film) 8.     Save the Last Dance 9.     ‘O’ (film) 10.  Lean on Me (film) View or read the book or film, keeping an eye on the cultural issues or problems portrayed in the work. Write a minimum 5-page paper that proposes a plan for delivering culturally competent services to one of the characters (who is a member of a minority group studied in this course) appearing in the book or film that the team selects. Develop specific culturally competent strategies to address those issues for the identified character. As this character’s assigned human service worker, what plan would you develop for them if, for example, they suffer from acculturation issues and face alienation from his or her family or if they are depressed, anxious, have substance abuse issues, anger management issues or...

Words: 376 - Pages: 2

Free Essay

Alice Walker

...Anitra Hatcher Academic and Professional Success November 2, 2014 Alice Walker After conducting research on several of my favorite authors, I selected Alice Walker’s life and works as the focus of this paper. Walker's accomplishments are substantial. Her novel, The Color Purple, won the 1983 Pulitzer Prize and the National Book award for fiction. She has authored many other critically acclaimed works, and is recognized as a leading author in the literary world. As I began to dig deeper, however, I found the real reason that I chose to concentrate on this individual. Alice Walker is an African American woman who expresses herself and her life experiences in her writing. I feel like I am connected to the themes and characters Walker develops in her stories. I feel like I am connected to Walker herself. I have been broken in some kind of way or another. I have been abused physically and mentally. Walker has not allowed her struggles to get in the way of her success or happiness. I chose to write about her because she is a woman who faced profound struggles in her young life. She came close to giving up because of a childhood accident and an abortion. Alice Walker was a fierce and determined woman who stayed committed to her goals. Alice Walker faced many challenges. She was one of seven children. She was born in poverty to sharecropper parents on February 9, 1944. Her father was the grandson of slaves. Her father did not want her to get an education in fear......

Words: 1158 - Pages: 5

Free Essay

The Color Purple

...lives and from society. In the novel, The Color Purple, by Alice Walker, the narrator is an abused black woman named Celie. Walker uses this unique protagonist to comment on the racism, sexism, and abuse of women that was so prevalent in the early 1900s. Walker used Celie’s inner monologue (in the form of letters to God and her sister Nettie) to convey the overarching message of the novel; the power of finding that inner voice that leads to freedom from the oppression of society’s expectations. Celie started off the book as a powerless victim of the men in her life with no voice. Walker uses Celie’s first person point of view to tell her life story of abuse and submissive silence. Celie’s only form of communication about her thoughts and feelings are through letters to God that are brief at first but then are more complex as Celie gets more confident and finds her voice. In the beginning, Celie’s inner voice had been beaten into silence at an early age by her abusive step-father and later by her husband with emotional and physical abuse. She survived by “[not] fight(ing)… stay[ing] where (she) told” and staying silent letting her step father believe that she is” too dumb to keep going to school” (Walker 2.254, 3. 342) Celie was only able to find her voice once she stood up to her husband and confronted him about his abuse telling him “youse children is rotten”, “why you beat me for what you done to them?” (Walker 7.94,7.92) Once Celie found her voice, she began to “see the......

Words: 1147 - Pages: 5

Free Essay

Alice Walker

...Morrell Professor Richard Raleigh ENC 1102 (02): Composition and Literature 12 November 2015 Alice Walker From Evelyn C. White’s “A Life” Winner of the Pulitzer Prize and the American Book Award, dedicated her life to establishing a literary canon of African American women writers and to encouraging the “survival whole” of all women. She has actively sought to win recognition for literary “foremothers” such as Zora Neale Hurston and to place their contributions within the fabric of her own artistry. Walker was the valedictorian of her high school class, and when she was graduated in 1961, she was offered a scholarship to Spelman College in Atlanta. After traveling to Africa in 1964. Walker returned to the United States and entered Sarah Lawrence College. She soon discovered that she was pregnant, and just as quickly she found herself depressed and on the verge of suicide. Walker made a decision to end the pregnancy instead of her life and subsequently wrote her first published short story, “To Hell with Dying.” She also produced Once (1965), her first published collection of poems, during her years at Sarah Lawrence. Alice entered the world before the midwife’s arrival February 9, 1944(White 12), into a family of sharecroppers near Eatonton, Georgia. Her father, Willie Lee Walker, was the grandson of slaves. Alice birth marked the first time that Mr. and Mrs. Walker were able to pay the midwife for her assistance (White 13) Walker’s relationship with her father became...

Words: 604 - Pages: 3

Premium Essay

The Hidden Outlier

...treatment of women has always been a hard subject in society and many subjects of novels. Walker dramatically shows realistic imagery, as she reels the reader in by conditions black women put up with and what life can be like when you are abused. In The Color Purple ,by Alice Walker, tackles the subject of sexism in communties. The first amendment does issue the fact that women's rights should be their and that everyone has the freedom, and that we all have quality The Color Purple written by Alice Walker should not be banned, through various arguments. Some including that it is an honest depiction of African-American life in the early 20th century, it addresses child abuse issues, rape, that still need to be addressed in our society, and because the freedom of speech is a constitutional right. The Color Purple was banned due to explicit language, sexual content, and racist stereotypes. Although, you would think the banning of the book is very difficult or hard but it is actually simple. There are two different ways to get a book removed, either banning or challenging. Banning a book is the removal no matter what. A Challenged book is when its an attempt to remove or restrict materials based of a person or group of people. A challenge is just to restrict it Cathcart 2 from schools, as to ban removal completely. Books are usually challenged or banned for best intentions of others and to protect. “ If all......

Words: 1150 - Pages: 5