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Working with your assigned group members, discuss the Case Study Analysis Questi

Working with your assigned group members, discuss the Case Study Analysis Questions (7-23 thru 7-26) immediately following the Damon White Party Promotions case below. Members of the group will assess the costs of starting a business and identify Damon’s fixed and variable costs for his party planning business.
Each group will create a narrated presentation (with each member participating in the presenting) and submit ONE assignment as a group to the assignment folder no later than XX/XX/XXXX at 11:30 PM.
Your presentation should include:
a cover slide identifying all team members’ names, the course name, and date;
an introduction slide with a bullet list of the key topics of the case;
four slides (one for each question) with your team’s analysis (reasons, examples, support from outside research) used to answer that question;
and conclusion/summary slide with lessons learned; and
a References slide (in APA 7.0 format) with your text and at least TWO other sources.
Be sure to incorporate course terminology and research (beyond your text) in your presentation and analysis. Keep in mind, ALL references must have a citation somewhere in your presentation.
Case Study: Damon White Party Promotions
The Problem
The telephone rang. Damon White put on his headset and answered, “Good evening, Seattle Teen Hotline. My name is Damon. How can I help you?” The year was 2009. Damon had been working as a hotline counselor at the Mayor’s Youth Committee for three years. Every night from 6 to 11 PM, he took calls from teenagers in the Seattle area, advising them on many different issues: relationships, family problems, school, and more. Damon had a natural talent for being a good listener. In fact, he listened so well that over time he started noticing similarities in the types of problems young people were discussing on the hotline. Specifically, Damon observed that younger teens in the Cedar Park and Eastlake neighborhoods did not feel safe going out on the weekends. Parents were also worried about the safety of their children and sometimes called to ask whether the Youth Committee ever sponsored teen parties or other gatherings. Damon always felt bad about telling parents that the committee did not have funds to organize these types of events. Damon liked helping people, but this was the kind of problem he did not feel he could solve.
Problems Can Lead to Opportunities
But then, one day in October, Damon had an idea:
Everybody was asking, “Is there going to be a Halloween party?” But there was not anybody throwing a party for the community youth, so I said I’ll throw my own party. I didn’t know how to DJ, but I had friends working as professional DJs. I just contacted everybody I knew who could help and then made it happen.
Damon decided to use all $700 of his personal savings to purchases services and supplies for the party. His intention was to earn this money back and generate a profit, by charging a $10 admission fee. He thought that $10 was a reasonable fee because it was about the same amount that teens would typically spend on a weekend night to go out to a movie or play video games at the arcade. Damon knew he had to be careful about how he allocated his resources because a $700 start-up investment was not going to get him very far.
Getting Organized
Damon’s first step in planning his party was to brainstorm a list of all the things he would need to purchase and arrange. The list he created was as follows:
Item
Space Rental
DJ
Security
Flyers
Insurance
Food
Decorations
He thought this was a pretty good list. The only problem was that he didn’t know how much each item would cost. Could he pay for these items with his limited funds? He was not certain. First, he needed to do some research.
Damon Investigates the Costs
Damon called his personal friend Janae, who worked as a professional DJ, to find out how much she would charge to DJ the party. Janae normally got $500 to DJ at Seattle’s hottest nightclubs, but she agreed to reduce her fee to $100 because she saw that Damon was trying to do something positive for the community.
Damon then spoke to another friend who worked as a security guard to ask if he could organize a security squad for the event. The friend agreed to find four coworkers who would work the event for $50 each rather than the usual $100 each.
Damon needed a large, centrally located venue where he could host the party. He remembered his friend Quinetta had once rented a dance studio in an old converted factory. The studio would be perfect because it was in the heart of downtown Seattle, where it would be easily accessible for area youth. He negotiated a deal with the studio’s owner for $200 for four hours rather than the customary $600. This rental fee included insurance costs in case there was an accident.
Throughout the planning process, Damon leveraged his personal network to assemble the necessary components for the party. He explained: If I had to go out and hire other professionals, I wouldn’t know them. And the fact that I did not have the money right then to pay full market prices for people’s services would have been a problem — but these people trusted me and said, “We believe in what you are doing, so we will provide our services at a discount.”
Damon’s final step was to get the word out about his party to teens and parents. He called his friend Javier, who freelanced as a graphic designer, and offered to pay him $50 to design and print 300 flyers, generating further savings of $50. By this point, Damon had already committed $600 of his savings toward entertainment, space rental, security, and promotional costs. With his remaining $100, he decided to purchase chips, sodas, cups, and napkins. He figured he could recoup his investment by selling these at a modest profit.
After making these arrangements, Damon filled in each item on the list.
Item
Cost
Space Rental and Insurance
$200.00
DJ
$100.00
Security
$250.00
Graphic Design and Flyer Production
$ 50.00
Food, Decorations, and Miscellaneous Supplies
$100.00
TOTAL
$700.00
Damon felt satisfied that he had managed his limited resources effectively. He was finally ready for the party. All he had left to do was decide on what costume to wear.
The Party
On the night of the party, Damon arrived early to set up. Despite weeks of planning he still felt nervous. He had never done anything like this before. What if no one showed up and he lost all his money? The doors opened at 9 PM and by the end of the first hour, only 20 people had arrived. Damon realized that at $10 apiece, that was only $200. The room looked empty, no one was on the dance floor, and Damon’s nerves were on overdrive! Suddenly at 10:30 PM, the party filled up quickly, and by 11 PM, Damon was amazed to see a line had formed outside the door. The studio had a fire-hazard limit of 300, and by 11:30 the party was filled.
Keeping Good Records
In the end, Damon’s party was a great success — personally and financially. When he sat down to calculate his revenue, he discovered the party had generated $3,750. Damon tabulated his receipts and created a chart so he could see how he accomplished this.
Item
Selling Price per Unit
Number of Units Sold
Revenue Generated
Admission Tickets
$10.00
300
$3000.00
Chip
$ 0.50
300
$ 150.00
Soda
$ 1.00
600
$ 600.00
TOTAL SALES REVENUE
$3750.50
It had taken Damon three long years of careful saving to put away $700 from his part-time job at the hotline, so he was amazed that so much money could be generated in a single evening. As he reflected on the experience, Damon realized:
Even if not many people had come to the Halloween party, it would have been a success because I put something together, and I profited from it. Not only had I profited financially, but I profited as an individual. It was something deeper than just money. You’ve got to go into business because it is something you love to do, and you want to create that independence. If you do something you love, you always do your best.
Future Possibilities
As he drove home from the party, Damon’s mind was reeling. He was thinking about the future and what he wanted to accomplish. Maybe he would use some of the profit he earned to throw an even bigger party or perhaps start a party-planning business. He was not sure. After all, organizing the party had caused him a lot of stress. Or maybe he would put the money in his bank account so that he could save up for school. He had several possibilities to consider. Damon drove home and parked his car. As he got ready for bed, he resolved to think further about future plans in the morning.
Case Study Analysis:
7-23. Assume that Damon decides to start a party-planning business:
Identify two ways he could assess the cost of goods sold for his business. (LO. 7.1 Assess the costs of starting a business.)
Which costs described in the case study would be part of Damon’s operating cost structure? (LO. 7.2 Describe fixed and variable costs)
Make a list of additional items Damon will need to purchase to get his business off the ground. Research the cost of these items. (LO. 7.1 Assess the costs of starting a business.)
7-24. One of the reasons why Damon earned a substantial profit is because he convinced his personal contacts to provide their services at discounted rates. Do you think he can continue to use this strategy? Why or why not? What would his cost have been if he had paid full price for everything? (LO 7.1 Assess the costs of starting a business.)
7.25. Brainstorm three things Damon might have done differently in planning his party to increase sales revenue.(LO 7.2 Describe fixed and variable costs.)
7.26. At the end of the case study, Damon describes how he profited as an individual from the experience of throwing the Halloween party. What did he mean by this? Is it possible to profit from something on a personal level, even if you do not necessarily earn a financial profit? Think of an example from your own life where this happened. Explain. (LO. 7.1 Assess the costs of starting a business.)

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