Case Analysis Lg Electronics

A Broad Cost Leader strategy maintains a presence in all segments of the market. The company will gain a competitive advantage by keeping R&D, production and material costs to a minimum, enabling the company to compete on the basis of price, which will be below average. Automation levels will be increased to improve margins and to offset second shift/overtime costs.

1) Issue – The team wants to develop new ventures and wants to keep it in house. They realize that everyone has things that they are working on. They start thinking of pulling warehouse staff to assist with order fulfillment, but right away Maria says no that it is not cost efficient to outfit them with new hardware. The

4. Distributing services using activity based costing reveals that Customer A is a highly more profitable consumer to Western than Customer B, despite identical net sales (see attached). Customer A uses less storage, delivery services, has fewer requisitions and a smaller inventory balance, making them a more inexpensive customer to service, in comparison to Customer B.

Businesses are not only faced with competition within the industry they operate in. They also face competition from businesses in other industries.

Strategically, Company G seemed to rely solely on volume sales with a low price point in all markets: Internet, wholesale, and private label. Their “basis for competitive advantage is lower overall costs than competitors…finding ways to drive costs out of their businesses and still provide a product…that buyers find acceptable.” (Thompson, Peteraf, Gamble, & Strickland, 2012) With an SQ rating of 5, quality was not a distinguishing factor; low costs were.

6. A product’s margin is determined by subtracting its manufacturing costs (labor and material) from its price. Logically, higher prices and lower labor and material costs result in higher margins. Keeping in mind the Customer Buying Criteria, how would you increase margins for a Low End product? How would you increase margins for a High End product? Hint: The criteria can be found in the Capstone Courier Market Segment Analyses.

4. This will depend on the position that HSM will take. The separates customer ignores quality in preference to the ability to purchase more garments, and might not perceive any difference between HQS and low-quality separates (LQS). Hence, if no action is taken by HSM, the separates customer might still prefer LQS (since it costs lesser than HQS, and enables them to purchase more garments), and HSM will still face significant competitive threat from LQS. Therefore, HSM must be able to differentiate HQS such that the separates customer perceives distinct benefits in HQS as compared to LQS, which also justifies the difference in price. One example would be to market HQS strategically so as to convince the separates customer that higher quality will equate to higher comfort (since separates customer places emphasis on comfort), which justifies the higher prices charged for HQS. Thus, LQS could cater to the separates customer who prefers having the ability to purchase more garments (and hence, sacrificing ‘comfort’), while HQS could cater to the separates customer who does not mind paying a higher price for more ‘comfort’. Hence, if HSM is able to create perceived value for its HQS and communicate this message effectively, it will be able to

In addition, better communication was required at time of design of LTM-1000 between marketing and ultimately our customers to first of all build what our customers wanted. Rather than creating a monster that was assumed was what our customers would buy. Second, should there existed an effective communication guidelines between finance, marketing and R&D at the time, we possibly could have convinced LTM 1000’s target customer to foot the bill for some of development and prototype costs. I am quite aware that LTM 1000 was on Brian’s Want-List which could not have been disregarded but with better consultation with other departments, it could have turned into a more sellable product rather than a successful crowd-magnet.

As technology continue to refine how products and services are delivered to consumers, competition among industry participants becomes more refined. Organizations that are able to keep up with changing technologies become leaders while those that are not fall behind. Mergers and acquisitions are increasing while causing small businesses to sell out or seek partnerships and cooperatives in order to remain competitive and relevant.

Hartley Electronics Ltd is a well-established company that has been trading since 1977. It has a good technical, financial and marketing section, but its human resources have been neglected, which has led to some problems within the company.

The true variable costs to Beauregard Textiles include the Direct Labor, Material, Material Spoilage, and Direct Department Expense. By excluding those expenses not related to the production of T-30, we can calculate the contribution margin for Beauregard using unit sales price and unit variable cost. Contribution margin is a measurement of the profitability of a product and is an excellent management tool to help determine whether to keep or drop certain aspects of the business. A positive contribution margin means that the company should produce the product, a negative contribution margin means the company is likely to suffer from every unit it produces.

with a number of strategic issues facing a capital-intensive, mature industry. Their product costing system was

New entrants in the industry that are battling to have a share of the market

Foor the control and evaluation, LG will use Quality Contol, Risk Analysis and Evaluation Analysis.

• Li&Fung’s success factors include focusing on efficiently managing the supply chain and a unique