Hello Yaxin,
I will try to make it clear for you. For the sales planning of the next yea, you can consider:
- Sales of the last fiscal year = 660M€
- Termination of production and sale of cat lavatories: -70M€ (table 3)
- Adjustment of the product portfolio removing products <5€ : 15% * 590M€= 88.5M€ (Diagram 1)
- Sales of next year = 660 - 70 - 88.5 = 501.5 M€
Regarding the gross profit planning, you use the 590M€ just to multiply it by the percentage that you have in diagram 1, in order to calculate the volume. It's enough not to consider the cat lavatories and the artciles <5€ to have the answer for the next year.
Does it make sense?Feel free to text me for any urther question.
Best,
Luca
Hey Luca! Thanks for your answer. I think it does help me understand it better. I am just wondering why we can't use 501.5 M€ as the basis for the second question to multiply it by the margin.
Because those margins refer to the 590M€ basis, pm me if it's still not clear
Yeah quite clear now. Thanks a lot!