Real-Life Math
In a marketplace where profits make or break a company's success,
brand managers have to know how to read and analyze financial figures -- budgets,
losses and returns. They have to be able to balance the cost of goods to the
profit they turn. They often have to solve business problems logically and
logistically. All these duties require math skills.
"Math skills are
very critical," says brand manager Rob Peter. "We're forever doing analysis
and using numbers all the time for market share and budgeting purposes."
It's
important to be informed on the sales end of the company, especially when
store clients expect you to have an understanding of where your business stands.
"Math
skills can be helpful, depending on how involved you are in the sales side
and how much you have to discuss growth markets with customers," says brand
manager Erin Duncan. "Budgeting is also important. Budgets are very much part
of my life."
You're a brand manager for a hair care products company.
You're launching a new shampoo and it's up to you to decide on its
pricing. You want to make sure your company makes a 30 percent return on its
investment in the product. This means that whatever price the company sets,
it has to be priced for at least 30 percent more than it costs to make, package
and distribute.
If it costs the company $2.40 to put the product on
the shelf, how much will you sell it for? Use your answer to determine whether
or not you should add a 10 percent price premium on top of that price to boost
your return. You know that research suggests few consumers will pay more than
$4 for a bottle of shampoo. Round the price to the nearest 50 cents.