“IT’S NOT A GIMME!” IMPLICATIONS OF POTENTIAL OFFSHORE PRODUCTION BY A GOLF GRIP EQUIPMENT MANUFACTURER
Keywords:
golf equipment industry, offshoring, accountingAbstract
After having served as the leader among golf grip equipment manufacturing companies for several years, ProFlight is faced with sales reduction and uncertainty. Increased competition by other grip manufacturers has resulted in ProFlight’s declining market share and failing customer satisfaction. The company is at a pivotable point! In an effort to regain acceptable margins and stimulate future growth, ProFlight has set a goal of $6,000,000 in annual savings. The most likely source of savings stems from cost reductions associated with direct labor and overhead. Therefore, to achieve an annual savings of this magnitude, ProFlight must consider moving a portion of its production offshore. However, relocation implications may be far greater than the desire for cost reduction.
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