Do math and layoffs go together. Are you worth it?
Assume Abilify sales are 4 billion with 20% mkt share. So every share point equals 200 million.
Assume Otsuka splts revenue with BMS so for this example each mkt share point is 100million
Assume 200 otsuka ns cost 40 million annually(at 200k each which includes salary, prgrams,benefits, bonus, mkt materials.,etc and that is $40,000,000. )
40 mill in sales force cost to make 2 billion
Assume we fire 100 reps you would save $20,000,000 annually
but if you lose 1 mkt share pt because of it you lose $100,000,000 profit
if you lose .1 mkt share pt because of it you lose $10,000,000 profit
Save $20,000,000 but if you lose 1 mkt share it cost you $80,000,000 profit.
or
Save $20,000,000 but if you lose .1 mkt share you still save $10,000,000 in profit
Break even is losing .2 market share points. Are 100 people saving a .2 market shar drop and better or is it worth it to cut the sales force to save at most $20,000,000
Assume Abilify sales are 4 billion with 20% mkt share. So every share point equals 200 million.
Assume Otsuka splts revenue with BMS so for this example each mkt share point is 100million
Assume 200 otsuka ns cost 40 million annually(at 200k each which includes salary, prgrams,benefits, bonus, mkt materials.,etc and that is $40,000,000. )
40 mill in sales force cost to make 2 billion
Assume we fire 100 reps you would save $20,000,000 annually
but if you lose 1 mkt share pt because of it you lose $100,000,000 profit
if you lose .1 mkt share pt because of it you lose $10,000,000 profit
Save $20,000,000 but if you lose 1 mkt share it cost you $80,000,000 profit.
or
Save $20,000,000 but if you lose .1 mkt share you still save $10,000,000 in profit
Break even is losing .2 market share points. Are 100 people saving a .2 market shar drop and better or is it worth it to cut the sales force to save at most $20,000,000