Business Studies : Alternate Task One

| The customers would be influenced because if the company are financially struggling the customers are there only hope to stay profiting. If the company was to go bust it means customers will no longer be able to shop there. The customers would be an external stakeholder, they can get information by advertisements and even check their annual report on the businesses website.

During this Period We decreased the price of our product from$ 5.45 to$ 5.29 to be more competitive in compare to our rivals and increased the sales force in chain drugstores and Grocery stores since they were receiving more sales than the other channels. As a result we increased our sales $29 million.

Mr Price’s mission is to be able to add value to its customers’ lives, by giving a great service and by selling quality products at a reasonable price. Mr Price also strives to increase the worth of its partners’ lives, by growing the company to increase the worth its shareholders’ investments.

This seeks to satisfy to some extent Gordon’s idea that a price increase may induce short-term profits, but should not exacerbate Nick Vlahos’ concern that a price increase will have a negative impact on the firm’s desire to drive out the Royal Oak brand.

One of the greatest is the simple fact that online sales allow a retailer to expand their current customer base without the added costs of opening and operating any additional physical brick and mortar locations. This type of business model also offers lower overhead expenditures, higher profit margins, and the ability to do business on a global scale 24 hours a day, 7 days a week. Even better, the target market could be anyone, anywhere!

The experts warned that clients may like to hunt for deep discounts. From a financial perspective, when we compare the revenues between the first semester of 2011 and the first semester of 2012, we see that they are dropping by a significant 21% for the benefit of competitors. The operating margin is hurt considerably as well, which means that the pricing strategy and the repositioning of the brand is not working for the moment and customers are not behaving as Ron Johnson expected, and very probably the situation would persist unless the management acknowledge that adjustments are required to make the strategy and its implementation a driver of growth on the top

1. What factors contribute to the rapid pace of change in business? Is the pace likely to accelerate or decrease over the next decade? Why?

The recent recession has hurt the entire retail market and regaining profits will be a constant challenge for the entire industry. In order to remain competitive, Ann Krill states,” value and versatility have become very important. She needs an incentive to shop.” (Hymowitz, 2012) Ms. Krill goes on to say,” I think in uncertain economic times, value becomes more important...” (Hymowitz, 2012)

Using an exercise called Mirror Mirror, HCL CEO Vineet Nayar proved to his employees that internal forces existed that required an organizational response. With this technique, Nayar forced his employees to talk honestly as they saw the truth of their business environment. This enabled him to learn, for example, that most employees knew the financial status of their incumbent projects, but had little participation or insight into the performance of other teams or even the entire company. As further discussions and structural realignments revealed, middle management positions were less exciting and offered little organizational value, leading to job dissatisfaction and increasing turnover as these managers left HCL for greener pastures. Overall, a lack of transparency contributed to an unvoiced malaise (Nayar, 2012).

IKEA’s corporate philosophy is to provide goods at a reasonable price. However, in providing products at a lower price than expected, then profit maximization is reduced (Rigby, 2011). This would be a possible threat on profit and may affect the growth for IKEA. To prevent their stock from becoming dead stocks, IKEA only order items when they are low in stock, provided the demand is there. Such as

2009 was a crucial year. It was in this year that the company has been successfully uplisted into NASDAQ. This event appeared to be the result of recovery of its share price considering the fact that its 2008 net income has increased by 50 percent compared to that of 2007 ended with 15 million (), however, that was probably not the only reason. During the second quarter of 2009, this company performed a so-called “Reverse Stock Split” which effectively increased their share price satisfying the minimum share price requirement for shares to be listed in NASDAQ (). This 1-for-2 reverse stock split has reduced the number of shares by about 50% from 29 million to 14.6 million, yet there was no change to the company’s market capitalization pre-split and post-split (). It can be said that the reverse stock split has generated an illusory image that this company was growing so that more investors would be attracted by this company (). The negative effect of this false image can be clearly seen from the above chart. The traded volume in 2009 has become significantly larger than those of previous years’. This share has seized the chance and almost achieved three times of the original price by the year end. It is noticeable that it was during this period, this company has raised its capital of $50 million.

The study shows the problem of when on the 15th of January 2016 the shares of Mr.Price plummeted 18% after the sales were weak. In the more developed countries of Africa consumer are unable to purchase goods due to increase in food costs, fuel and unemployment. Competitors such as Foschini have been excelling due to in store credit purchases where as Mr.Price had 80% purchases of cash.

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The six-year contract between Randall PLC and Hopkirk PLC started in January 2013 for the sale and delivery of 1,000 widgets per month at £3,000 a month. Randall PLC then asked Hopkirk PLC to move the delivery to every other month with 2,000 widgets, Hopkirk agrees and the contract continues on this basis. Hopkirk PLC is in financial difficulties and notices the market price of widgets has dropped and asks if Randall PLC will accept £2,000 instead of £3,000 a month. Randall PLC agrees to this but only on the promise that Hopkirk will extend the existing contract when it

This fact is increasing the importance of private label references. The importance of price is resulting in the growing importance of discounters as a place to make daily purchases. Discounters recorded a positive performance in 2009 and it is a good sign for Marks and Spencer. There is the arrival on to the Spanish market of low-cost outlets such as Kiabi or Primark, and the good performance of second-hand shops which will not have a significant change on opening M&S in Spain. (Ibid)