Investment assessment to manufacture and sell a new product

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Discussion Overview

The discussion revolves around methodologies for assessing whether a manufacturer should invest in the production and sale of a new product. Participants explore frameworks and procedures that could facilitate a systematic evaluation of such investments.

Discussion Character

  • Exploratory, Technical explanation, Homework-related

Main Points Raised

  • One participant inquires about methodologies or frameworks for investment assessment in manufacturing new products.
  • Another participant suggests creating a spreadsheet or business plan to outline costs, investments, and projected sales or profits over time, indicating that this could help determine break-even points and return on investment.
  • A third participant points to a resource containing sample business plans, specifically noting the section on Product Development, which may include relevant examples.
  • A later reply confirms the presence of a sample spreadsheet in one of the business plans mentioned, providing a specific reference to a page number.

Areas of Agreement / Disagreement

Participants generally agree on the utility of business plans and spreadsheets for investment assessment, but there is no consensus on specific methodologies or frameworks beyond the suggestions made.

Contextual Notes

The discussion does not address potential limitations of the suggested methodologies, such as assumptions about market conditions or the accuracy of projections.

Who May Find This Useful

Individuals interested in investment assessment, manufacturing, product development, or business planning may find this discussion relevant.

physea
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Hello

Are there any methodologies to assess whether a manufacturer should invest to manufacture and sell a new product?

I am looking for any Frameworks or procedures that could help methodically and systematically assess an investment like this.
 
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It's been a long time but..

Usually you build a spreadsheet/business plan showing when and how much costs/investment would be incurred and when sales/profits or cost savings are likely to be made, perhaps on a month by month basis or yearly for longer projects. By adding suitable running totals you can work out things like when you will break even, when your expenditure will peak and what your return on investment would be by the end of the project or some set time period.
 
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Yes last page (for example page 9 of the soap manufacturers plan) is a sample spreadsheet.
 

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