Issue 4, 2010

Makarova O. V., Pustovalova T. A. Helping Jewelry Production to Overcome the Crisis: Reduction or Expansion (Case Study).

This case is based on the history of development of Russia’s largest bijouterie manufacturers — company Etalon-Jenavi, founded in the early 1990s. For a long time the company successfully worked virtually without competition. However, the active expansion in the Russian market of foreign bijouterie manufacturers, which began in 2004, and a significant drop in sales during the financial crisis 2008–2009 put the company in front of a difficult choice. The Etalon-Jenavi management must decide whether to reduce production capacity or to continue to invest in the development of production, relying on rapid recovery of the market and demand increase. The no-easy solution must be economically substantiated; however, presentation of such substantiation turns to be a hard task for the Chief Financial Officer. The case is based on events and problems actually encountered by the Etalon-Jenavi manufacturing enterprise. The case may be used for teaching purposes at courses “Managerial Accounting”, “Financial Management”. Keywords: Anti-Crisis Management, Economic Efficiency, Key Indices, Operational Financial Management, Managerial Accounting, Expenditure Management, Budgeting.

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