ation requires focused promotions, while differentiation relies on mass marketing.
Our cost of goods sold for this SBU remained in the 50 percent level (as a percentage of sales) throughout the entire period, while our total expenses fluctuated from a low of 33.2 percent in Quarter 2 to a high of 53.7 percent in Quarter 5. Unlike the health club industry, which posted profits throughout the period, the exercise equipment SBU posted losses in Quarters 5 and 8, and barely made profits in Quarters 6 and 7.
However, the SBU has recently made strong gains in its profit picture, and total expenses have fallen from 51.5 percent of sales in Quarter 8 to 35.9 percent of sale
...