Lowe’s Companies, Inc. is a FORTUNE® 50 company that serves approximately 15 million customers a week at more than 1,750 home improvement stores in the United States, Canada and Mexico (Lowe's Companies, Inc, 2011). Lowe’s offer several different incentives to shop which lures customer to the home improvement retail center. These incentives, such as the “My Lowe’s” program, price matching, the Lowe’s Consumer Credit Card and their own durable, long-lasting and cost effective products. INTRODUCTION Lowe’s Companies, Inc. is a FORTUNE® 50 company that serves approximately 15 million customers a week at more than 1,750 home improvement stores in the United States, Canada and Mexico. Lowe’s is an American chain of retail home improvement and appliances.
“T. J. Maxx is the leading off-price retailer of apparel and home fashions in the United States and worldwide, ranking 119 in the most recent Fortune 500 listings and ranked #1 on The Boston Globe 2010 Globe 100 list” www.tjx.com/aboutus. T. J. Maxx’s competitive advantage of its competitors is really not amongst competitors because the normal stores that a consumer would shop prices in comparison with T. J. Maxx would usually be Marshall’s. Marshalls just happens to be owned by T. J. Maxx, therefore there is a dominant factor in the field of competition because T. J. Maxx has saturated the market that if you one does find a better price at Marshall’s, T. J. Maxx still reaps the harvest of that sale. As mentioned, the bright, colorful décor that T. J. Maxx uses to dress up their stores is a great leap towards attracting consumers.
Profit maximisation is assumed to be the objective of a firm, however there are other objectives that firms have, these include: revenue maximisation and sales maximisation. A firm aiming to maximise profit will aim to operate at output level Q, where Marginal Revenue (MR) is equal to Marginal Cost (MC). A process that companies undergo to determine the best output and price levels in order to maximize its return. The company will usually adjust influential factors such as production costs, sale prices, and output levels as a way of reaching its profit goal. There are two main profit maximization methods used, and they are Marginal Cost-Marginal Revenue Method and Total Cost-Total Revenue Method.
Economies of scale can be enjoyed by any size firm expanding its scale of operation. It is important to companies such as McDonald’s and GBK because firstly, a large business can pass on lower costs to customers through lower prices and increase its share of a market. Secondly, a business could choose to maintain its current price for its product and accept higher profit margins. 3. a) What are marketing economies of scale? As a firm grows the average cost of advertising per unit will fall, leading to lower average costs.
The higher the ratio the more assurance exists that the retirement of current liabilities can be made. The current ratio measures the margin of safety available to cover any possible shrinkage in the value of current assets. Normally a ratio of 2 to 1 (2.0) or better is considered good. Short-term creditors prefer a high current ratio since it reduces their risk. Shareholders may prefer a lower current ratio so that more of the firm's assets are working to grow the business.
The switch is easy and cost-efficient. c. the ratio of fixed to variable costs is high: Inventec has to reduce prices to utilize installed capacity. (e.g. its new manufacturing compound in Pudong, Shanghai) d. OEMs own the distribution channel and make the rules. 2.
Affecting Change Nick Khan LDR 531- Organizational Leadership DeVry University Mr. Larry. M Jul 06, 2009 Affecting Change This paper will address the simulation of Leadership in Action. The issue at hand entails a company, Smith and Falmouth, a mid sized company that provides tele-shopping and a mail order network. The company has decided to start a new e-tailing business unit to add to their business portfolio. The CEO, Irene Seagraves, has put together a team consisting of a project manager, a marketing manager, a logistics manager, and a web development team.
Individual financial gain determines the price for oligopolies. These firms find non price competition to keep from having to change the price of their products. The output of each product must be maximized to see a true profit which is
In a highly competitive business world, on a firm’s priority list is the subject of increasing profit and reducing cost. One might than pose the question, has this put them out of business (mom and pop store)? The answer is absolutely not, but rather, they too benefit from cheaper prices as they continue to buy in bulk and continue to operate as the name suggest, convenient
Week 2 Learning Team Reflection Team A agrees, this week introduced new concepts and understanding. Week two the main objectives we focused on were production and cost analysis. We discuss the relationship between the number of inputs and the law of diminishing marginal productivity, and analyze the relationship between productivity and the cost of production. We collectively discussed the objectives and illustrated the topic we feel comfortable with, any topics we struggled with and how these topics relate to application in our field. Colander (2010) explains the role of the firm in production and how firms strive to maximize profits through maximizing productivity and minimizing costs.