1. How was Target’s pre-recession strategy vulnerable in an economic downturn? Target’s pre-recession strategy was vulnerable in an economic downturn largely due to its disaccording brand positioning that focused on delivering high quality products compared to its counterpart, Wal-mart, which took advantage of its “lower pricing” positioning during an era when customers were highly price sensitive. Initially the CEO of target, Steinhafel, responded to the recession by (1) cutting costs, (2) focusing on the value aspect of Target’s “Expect more, pay less” campaign and (3) expanding selection of grocery items. However all of these strategies were either short sighted or ineffective in contributing to the company’s bottom line.
1) IT outsourcing of Perot Systems Inc., which was founded by Ross Perot in1992 would lead to a "giant sucking sound" of U.S. jobs over the border, is operating in a way similar to many outsourcing firms and is increasing use of overseas labor. Indeed, it has significantly affected unemployement in us with the company going to look for cheaper workers principally in India. Furthermore, it created a break in prices which led to a quasi monopoly for a specific period of time wi the consequences of killing the competition. 2) In the beginning of the decade the IT department has suffered from unsufficient founding. Indeed, compared to other departments the IT one received significantly less funds what did not enable it to develop at the same pace of other departments first and created a marginalisation of the IT department what might be deeply prejudicable to the company.
Summarize the case in five sentences Because there are many porcelain makers in Jingdezhen, the quality of products are low,the styles are limited, and the productivity are low. Most porcelain makers set minimal profit margin goals to pursue volume pricing strategies in the mass market, that cause their works could be mediocre quality and customers could shift to other suppliers. JCAC want to differentiated itself from its rivals by quality and artistic style of its products, and produce high-end product. What are the problems (and the origins of these problems) facing the porcelain/ceramics industry in Jingdezhen? Most of the porcelain makers in Jingdezhen unable to offer uniquely designed products and differentiate themselves from their competitors.
There is a dispute amongst economists on the subject of whether a “Trade off” exists between inflation and unemployment. According to the Phillips Curve, in the short run, if a government tries to reduce unemployment there will be an inevitable rise in inflation. In the diagram below the government reduces unemployment from 5% to 3% ant it leads to a rise in inflation from 2% to 6%. This theory supports the fact that any efforts made by governments to reach full employment will lead to inevitable inflationary pressures. This view is supported by AD/AS analysis: Originally the economy is at “P1, Y1” and there is a large negative output gap (YFE-Y1), which means that unemployment is high.
This led to a 4% drop in share prices. Secondly, it has reaffirmed its commitment to market research, and generating more information about its customers. (Jones, 2001) Disappointing Growth of Flagship Brands: There are two major factors that are contributing to the poor financial outlook. Firstly, the disappointing growth of the company’s flagship brands and products resulted in meagre profit growth. P&G have always been a leader in customer research, and this has helped it make small amendments adding value to these existing products.
Wal-Mart: “Everyday Low Prices” in China Wal-Mart, what started out as a few small discount centers in areas where no big retailer was willing to operate, has since grown into one of the top retailers in the world, boasting the top revenue in the retail market and being the once “most admired” company in the US according to Fortune magazine. Wal-Mart’s success can be attributed to a few different strategies, such as the commitment to sell name brands for less than competitors, availability, service, and cost control. Wal-Mart has used a strategy of going into communities in which there would be no real retail competition, essentially where it would be unrealistic for consumers to shop elsewhere. Also by providing a mass variety of goods, Wal-Mart has developed a one stop shopping center, providing convenience to buyers, in particular families. By driving down the costs from their suppliers and overhead as much as possible, it resulted in some of the lowest prices possible for consumers, in which they kept at low prices all the time, as opposed to constant fluxuating prices with sales and promotions.
The use of child labor or work conditions in the labor force are some of the malpractices organizations are noted as using on both the local and international level (Heffner, 2012). Nike Corporation is among those corporations that have been highlighted and criticized for its organizational culture. Nike outsources their labor to countries that are in need of economic growth. They are able to obtain the labor at a cheap, and some may say, unfair rate. This causes workers to be exposed to working conditions that would be far below what we would accept here in the US or any developed country in the world.
“One seemed to have strong management and a very predictable market; the second offered a chance to Improve margin performance and streamline operations; and the third operated in a fast-growing market.” Strong management and predictable market--- Coming home funeral services Chance to improve margin and streamline operations – 3F AG Fast growing market – YCB 7. Empire had gained its reputation when it was one of the few LBO partnerships. What is the time sequence of activities of LBO firms? Buy cheaply Leverage them heavily Live with the debt Flip them to a market through IPO or M&A 8. O’Malley knew that firms had developed styles—Golda, Thoma, Cressey, and Rauner had developed the concept of buying a platform firm and consolidating an industry around it; some firms, such as Bain Capital, created efficiencies and added value by changing the acquisition’s strategy; yet others, such as Thomas H. Lee & Company, emphasized growth, buying firms that could add value through organic growth as opposed to financial leverage.
HM’s sales down 19% iii. Debt-to-equity ratio rose greatly, from 1.18 in 2006 to 47.66 in 2008 iv. Dividends/share cut by approximately 70% v. CapEx reduced to 0 in 2009 d. Increasing cost of raw materials & increasing competition from overseas manufacturers vi. Impacted low-cost producers more than high-quality producers 3) Sociocultural: e. More employees are spending more hours in front of computer screens than ever before vii. Demand for ergonomically correct office furniture increasing f. Demand by shareholders for more CSR efforts by companies viii.
10 Marks (b) Studies have shown that the demand for tobacco tends to be highly price inelastic. Evaluate the view that governments can best reduce smoking by substantially increasing taxes on cigarettes. 15 Marks 2 May 10 SL P1 (a) With the aid of at least one diagram, explain the