Business Expansion in the Book Printing Industry: Process Efficiencies and Decision-Making

Amid some of the greatest advancements in e-books and online media to date, a mid-sized book printing company in Central Wisconsin has made the decision to expand their operations. Leaders of Worzalla Inc. explain that demand for their products is so high, they are being forced to turn customers away as their current space and physical capital cannot satisfy the desired amount of business. In order to meet the heavy needs of their customer base, Worzalla believes they must expand with the intention of increasing production speed, growing labor efficiency, and limiting fixed costs. This multi-year project will cost Worzalla over $30 million to complete. The project will be implemented in three phases, each phase satisfying an important factor to Worzalla’s core operations and financial condition: revenue, customers, economic and technology trends, and technology investment. Is Worzalla justified in their decision to expand operations based on these efficiencies and factors?