They were also able to lower their shipping cost of bulky items such as furniture by having it disassembled to maximize the use of space inside their shipping containers. b. Delivery Speed “Make the Product or Deliver the Service Quickly” - Ikea strives to deliver the number of goods to the right stores at the right time. They calculate the goods requirement and make sure that deliveries are efficient. c. Environmental Impact - Part of Ikea’s environmental considerations is making their mugs lead and cadmium free.
So the new wood yard would reduce the operating cost and increase the revenues. Prescott realizes that there are some benefits in adding in the wood-yard. First they would no longer need to purchase shortwood from their competitor The Shenandoah Mill. The next benefit was creating a new opportunity to sell shortwood on the open market and be able to level the competition between The Shenandoah Mill. These benefits will help to lower the operating cost and raise revenues for the Blue Ridge Mill.
One example of a business where IM will not work is a business that that sells electric wheelchair. Additionally, companies looking to sell products to a wide range of people and are looking to have large number of sales will not find IM as useful as outbound marketing (OM). While IM is good because it is cheaper to imploy and brings in higher value potential customers, it only captures a small market. OM should still be pursued if a company is seeking for large sales and large customer base. The most optimal marketing strategy may still be to apply both methods of marketing with the right
Besides having control of the asset, it increased its competitive advantage. On the other hand, Arauco outsourced its trucking system. Obviously this was not a strategic activity for the business and there were several companies that could provide the service. Integrating this activity into its operations, would have probably cost Arauco a lot in terms of time and money, and supposing it did not have any relative competence compared to other suppliers, its competitive advantage could have been deteriorated, but the overall result would not have been worse than not integrating the forest business. It is true that nonstrategic activities performed in-house are dead weight when the organization competes with more focused firms , but for Arauco losing or not having control over its most strategic asset would represent losing part or the whole business due to the long replacing time of the resource under certain
3.) The issues and problems facing the company are, wanting to move operations to one of two locations because the current production location is too small. She is looking for a building on either 31st street, or 15th street, but the cost of NYC locations is very expensive. Other problems are high costs of labor and ingredients, whether or not to keep company wholesale or retail, and a possible increase of debt with expansion. 4.)
The most attractive strategy of Primark is about cost cutting strategy is by cutting cost of the volume of the turnover meaning the company can negotiate cheap price from its manufactures in China and East Europe then they take a smaller profit margin per item than some other high street stores (Ergo 2011) see Appendix 1. This manufacturing strategy is the main selling point of the company. Primark does not believe in advertising there company rely on “big bags and big savings” to convey their message they also display they
They have a good variety of products to shop for. Wal-Mart has many competitors, but one of the strengths that the company has the ability to lower the prices for their customers need. Wal-Mart can be consider a unique store because of one special strategy that they have. The strategy consists of comparing the prices of the other stores, if the other store has an ad of a lower price than Wal-Mart, then they will give it to them to the same price. Many costumers is one of the plus that they give to Wal-Mart because this means that they don’t have to go store by store catching all the specials that they have.
What are the core competencies and end products of IKEA? How are they linked with each other? IKEA is capable to design its products in-house; therefore they can reduce their costs because outsourcing their product designing is much cheaper. Despite that they’re designing its product itself, people find it still attractive enough to buy IKEA’s products. Also their furniture and packaging is designed in such a way that it’s easily transportable (‘flat packaging’1) for both customer and IKEA.
Relevant financial information contributes to sound business solutions. For example, the predicted future costs and revenues that differ among alternatives are essential to financial decisions. Currently, Guillermo’s patented finishing coating does not have a large market audience as does the flame-retardant coating. Thus the company has determined that it could purchase another finishing product that would add the same amount of value to its custom furniture. This alternative requires consideration of the opportunity cost of eliminating in-house production of the finished coating.
Privatisation is the selling of public sector assets to the private sector in order to introduce competition and improve market efficiency. One argument for privatisation is that private companies are incentivised by profit by cutting costs and producing more efficiently. If you work for a government run industry, managers do not usually share in any profits. However, in private firms managers will usually receive a share of the profits motivating them to work harder, and as they are interested in making profit they are more likely to cut business costs and aim to be more efficient. Since privatisation, companies such as BT, and British Airways have shown degrees of improved efficiency and higher profitability due to the competitiveness within their respective industries.