Abstract
On the market overview of the company the Blue Company enjoys a 14.25 market share. The main contributors to this market share are USA with 14.20% and Asia with 20.48% market share.
The main factors influencing the market share are demands, nature of the products, change in tastes and preferences of the company, overall market demand, expected changes in prices, market shares, competition and investment trends of the company. The Blue Company is extremely cautious on these factors.
The performance overview of the company is based on six rounds which indicate the trend of the company in terms of market share. The Blue Company indicates that the market share for the company decreases in the first four rounds but increases in the fifth round with an exception of a decrease in the sixth round. This is an indication that factor influencing market share may have variant effects on the performance of the company.
The different stages call for different measures which have to be adopted through adequate research and use of modern techniques. Each strategy brings unique outcome. Continuous development represents chances to foster the adverse challenges that competitors bestow on the Blue Company.
Management decisions are extremely critical in offering advice for excellent choices that would encourage outstanding performance. Leadership through proper management skills lead to excellent performance in a company.
Market Overview
The company enjoys a worldwide market share of 14.25% (Cesim, 2013). However, this share is based on contributions by different markets in which the company operates. They include;
The United States where there was an aggregate of 14.20%, Asia had the mean of 20.48% and in Europe where the product demand was extremely low such that it could not have been ranked in percentage form (Cesim, 2013).
The worldwide market share was based on the following elements.
The first factor is the nature of the product. The product is in the form of technology and it contains different features as well unique prices in comparison to the prices of its competitors. Promotional strategies also played critical role since customers always compare various offers that various companies make and they come up with a choice based on their tastes and preferences (Gill & Chatton, 2001). Therefore, our organization has to be extremely keen on the marketing options we adopt since they will determine our market share.
Our firm had also to make decisions on how it would meet the market demand, pricing in comparison to other firms as well as promotion. While making these decisions the past market share for the technology would be extremely significant.
Demand
There are various factors that are likely to influence the demand of our product.
Overall market demand
This defines total number of individuals who will be willing to consume and can afford our products at the prevailing market price. However, this price may be influenced by prices of competitive forms of technology.
Change in tastes and preferences
Following continuous use of the same form of technology, companies may choose to try new forms of technology. Therefore, our firm has to remain focused on innovations.
Predicted market growth
This refers to the anticipated expansion in the market in terms of demand.
Market shares
This refers to the percentage, which the market commands in terms of customers’ loyalty to our products. The main factor that influences this is the marketing prowess of the technology. Adverse marketing strategies may create room for advanced market share.
Competition
This refers to a group of companies producing similar goods or offering similar services. In our case, competitors are Grand Reseau , Union Soldiers, Oranza Telecom, Huawei Telecom LLC and Cosomak Telecom (Cesim, 2013). Competitors affect our operations in various ways like quality, quantity, and prices of the products. To become outstanding in the extremely competitive environment our firm had to consider setting attractive prices, high quality production, and maintenance of the right quantity of products in terms of weight and size.
The organization also has to maintain a favorable credit policy that would allow credit sales. However, this has to come with implementation of various strategies that would ensure customers pay their credit.
The firm has to advance its promotional strategies to create advanced awareness of the products to esteemed customers. The firm should not stop in its inventions as well as improvement of the existing products. This will be a strategy to accommodate many customers since changes in their tastes and preferences will be handled.
Investment trends
Our firm has been keen to invest exhaustively in research so as to influence modern technology in the market. It estimates on future trends in the market to make necessary arrangements.
The firm also needs to set up new facilities that would influence the emerging technologies. This would help the firm keep in touch with new demands and minimize excessive costs.
Technology investments support the long-term policies of the firm. The firm needs be ready all the time to ensure there is money available for investment whenever required (Porter, 1980).This can only be achieved through extensive planning and minimization of unnecessary expenses.
Company and Performance Overview
The market share of a company is an extremely significant factor in the determination of the performance of an organization. In Round 4 the global market share was 0.50%, which was improved in Round 5 to 5.29% and reduced in Round 6 to 0.19%. This indicates that the market share of the company advances in the sequence of rounds (Cesim, 2013).
Through the above analysis it easy to predict that performance of the organization will improve in the next financial year. The global market share gap is not likely to end in the next financial year.
Our firm produces only tech 1 which is extremely low compared to our competitors’ production. This is the driving force to advanced investment.
The number of features offered includes 1 for United States, 1 for Europe and 1 for Asia in the last three rounds (Cesim, 2013). Through advanced research our firm has a plan to increase the investment.
The goal of the firm is to increase the overall performance through increased market share as well as the amount of features rampant in our market share. Our firm has continuously increased the market share as shown in the increases in each round and we are on a mission to increase the quality in our products.
Competitor’s analysis
This refers to the assessment of the firms in the markets that manufacture similar products like our firm. This analysis is critical in determining whether our company has a competitive advantage over other organizations.
Characteristics of products are usually influenced by customer’s tastes and preferences. Our firm has ensured extensive commitment to meeting the requirements of our customers. This has been achieved through massive research aimed at improved production.
The comments of our customers have also been influential in making improving the quality of our products. This usually defines the tastes of our customers and we have to cope with them. Therefore, the firm had to identify control measures concerning a complaint made by the customer on the products of our firm (Gill & Chatton, 2001).
The behavioral comment by the consumers is an extremely significant method of determining whether our firm’s products are satisfactory to the needs of the customers in the market. These comments can also identifying the market niche that the firm can explore to advance the market share.
Common size analysis is the method of representing items in the statements of the performance in form of percentages of assets and income statement as percentage of sales. The firm calculates these percentages to determine if the firm can pay for its liabilities as well as equities from assets and its expenses from the sales.
This analysis aids in minimizing bias that may take place when analyzing companies that of variant sizes. This allows for an analysis of our firm over several time intervals and it can show the percentage of sales in total cost of sold goods and the alteration in value over a period of time.
Management decisions analysis
Our firm intends to undertake various management decision analyses. One of the main decisions that our firm would undertake is to ensure expansion is the firm’s plant investment. This is clear on the cash outflow in Round 5 of our operations. The main reason for this increased demand for the technologically motivated products as well as our need to minimize operating and production costs. This strategy has been influential to increased demand and market share for the products creating healthy environment for competition (Porter, 1980).
The choice to offer equities to potential shareholders in Round 4 was to raise funds for the improvement of our production plant and to attain more resources for technology investment. Following these investments, operating profits of the firm have increased steadily for the last three rounds and even though the number of shareholders increased, the earnings per share ratio is also gradually advancing.
Analysis of strategic outcome
Following adverse market competition it was extremely difficult for our company to achieve the target profits. The main reason for this is that our competitors have access to wider market and have imposed low prices on competitor products (Porter, 1980).
In this case, our firm has come up with policies to review our market prices and manufacture the products based on the interest of our customers.
The company is also coming up with a new production plant that will aid in the production of more advanced products to lure customers to our side.
Analysis of demand across Rounds
The final analysis is based on the determination of all the market factors affecting demand. This refers to the determination of the entire market demand, the predicted market growth, the selection of the particular product as well as total share of the market.
(Cesim, 2013).
Round 1
Our global market share is 5.16 which is the lowest in comparison to our competitors. The percentage is slightly lower than the starting 16.67% which was the initial market share for all companies (Cesim, 2013). The main factor that has been influential to the percentage is the investment in technology where our company failed to invest extensively on research and development.
In the United States our products were most expensive thus influencing demand and the market share at large. The promotion techniques that we adopted did not work to our favor. Our products were of a lower quality.
In Asia which is the main production center, there is massive output although we depended mainly on contract manufacturing. This indicates that our production line was out to serve the outsourced product. The main production took place in the USA.
Although, extensive production took place in the USA our main market was Asia where all companies sold equally. Therefore, the market was fairly distributed among all companies.
Therefore, Round was a successful business operation.
Round 2
In this round the market share dropped to 2.05% which was a drop form the first round (Cesim, 2013). This indicates that there is a drop in some activities for the company. One of the main factors that have contributed to the decline is poor promotion technique that has rendered the company exposed to massive competition that reduces its market share in favor of our competitors.
The profit for the company also dropped following the inability to produce more with little investment. This means the demand is also low and there is no room for advanced trade to encourage extensive profits for the firm. To ensure that we sustain continuous performance in profitability we need to adopt new strategies in terms of research and promotional strategies (Porter, 1980).
The drop in profit for the 2nd round means the firm has to do more investment in capital to ensure it stands the competition fostered by competitors.
Round 3
This round recorded a market share of 1.38% which was another drop in comparison to the second round (Cesim, 2013). This is an indication that the company was still in the process of recovery and the new promotion strategy imposed on round 2 had not worked.
Therefore, the company had to employ new promotional methods that would ensure that the company keeps track on high performance. The company should be also cautious on the quality of products that we manufacture. The customers may have gotten used to our goods and had opted for another set of qualities. Therefore, the next strategy would have been to increase the variety of products in terms of quality for the product (Alexander & Britton, 2004).
The loss indicates that prices per share for the company continued to increase. Therefore, it was difficult to gather more capitalization to equip the business with the ability to challenge activities by the rest of the competitors.
Merging the above strategies there would be room for development in the firm and production will be likely to increase.
Round 4
Despite the strategies imposed on the third round the market share for the company has reduced again. The round 4 indicates that the company was enjoying 0.56% market share (Cesim, 2013). This is an indication that our firm had not gained adverse skills to aid in competing with the various competitors in the market. The drop extends to more than a half of the share in the third round.
Our company had not yet understood the tastes and preferences of our customers. This made us access just a few numbers of customers who were pleased with our products. This means that research and development needed to be conducted to ensure that we were able to satisfy the needs for our customers. It would have been wise to gather their comments on or products and what they would have wished us to change in terms of quality.
In the USA which could have been our main market, the prices for our commodities are extremely high compared to what our competitors charged. Therefore, we needed to adopt new strategies that would make prices low in the USA. This would have been setting up new production plant in the country to ensure we are able to produce there and capture wide market following low prices that we charge our commodities (Alexander & Britton, 2004).
The next strategy would have been to adopt new production plants in each of the countries to ensure that there is extensive production. This would be an extremely critical strategy that would allow the company to produce in the three countries and maintain low cost of production. This would allow the company to sell their products at low prices and access more revenue for promotional strategies.
Round 5
This round is characterized by a rise to 5.29% of the market share (Cesim, 2013). The increase in the market share was as a result of increase in the market share of the USA and Asia. This is an indication that although the company charged a price that was slightly higher than other companies in the USA but following the adverse investment that the company dead on its strategy to invest in the USA market it has been able to scoop a wide market share. This shows that the interests of the customers were considered and some of the got satisfied with the new forms of products in terms of quality.
The company had sort to invest more on research which aided in identifying the right market and the tastes of the people in the market. Although, it was not able to meet the requirements of all customers, there was a platform for convincing several customers in the market.
Advanced market share may also be influenced by the existence of a coherent promotional strategy that would have bestowed the increased market share.
The main strategy that the company should undertake to sustain this share as well as increase the share is to advance in the research and development of the tastes and preferences of the customers and what may have led to a wider market share for the company. The company should also continue in investment in promotional strategies to allow higher demand for the products through creation of wide customer base.
Round 6
This round is characterized with a 0.19% market share which is a significant decline from round 5 (Cesim, 2013). This indicates that the demand for the products from the company has reduced significantly and the competitors have taken advantage of the situation through adverse investments in promotion outshining our company. This has rendered our competitors a wide market share.
This may also have been influenced by change of tastes by our customers which would have resulted from poor production. However, the most rampant cause of the drop in the market share is the high price of our commodities in the USA. This being an extremely crucial market to our company, we were not in a position to maintain low prices which could have been influenced by the high production cost and costly promotion strategies.
This is an extremely significant stage that would aid our company in evaluating the various strategies that we would adopt to ensure the demand for our products kept on increasing. It would be extremely easy to determine the best promotional strategy for the company to ensure that the business remains competitive and it is in a position to acquire an increasing market share as time elapses (Alexander & Britton, 2004). The company will also be able to set up a competent research and development team that would give the company a chance to analyze the market, demand trends, preferences and tastes of clients as well as new technology in the industry.
References
Business Management Simulations | Learning by Doing | Cesim. (2013). Business Management Simulations | Learning by Doing | Cesim. Retrieved May 21, 2013, from http://www.cesim.com
Alexander, D., & Britton, A. (2004). Financial reporting (7th ed.). London: Thomson Learning.
Gill, J. O., & Chatton, M. (2001). Financial analysis: the next step (Rev. ed.). Menlo Park, Calif.: Crisp Publications.
Porter, M. E. (1980). Competitive strategy: techniques for analyzing industries and competitors. New York: Free Press.
