Page 8 - MCS August Day 2 Tasks

CIMA AUGUST 2018 – MANAGEMENT CASE STUDY

TASK 2 – DISTRIBUTION CHANNEL ANALYSIS

Trigger and Task

Your manager has emailed you:

To: Financial manager

Date: Today

Subject: Distribution channel analysis

Hi,

Given the underperformance in sales of our own branded shops in the latest quarter, I want to
produce a report for the board regarding our distribution channels. I’m going to recommend
implementing a distribution channel analysis so that we can get a clearer picture of the
profitability of each of our sales outlets, but need to back up the recommendation with some
discussion of the costs and benefits of doing so.

Could you put together:

‐ a list of our distribution channels along with details of overheads that would be specific to those
channels and which will therefore affect their profitability relative to others?

‐ an overview of the costs and benefits of performing a distribution channel analysis using activity
based costing principles

Regards,

Senior Financial Manager

Prepare the work that your manager has requested. (Time 45 minutes)

24 KAPLAN PUBLISHING