Question

Marketing Questions:

1. You are requested to produce 50,000 units. Consumer demand is 40,000 units . Inventory holding cost is 5,000. What is the Actual Production Volume and Sales?

2. You are requested to produce 50,000 units. Consumer demand is 50,000 units. No inventory holding cost. What is the Acutal Production Volume and Sales? What does this mean to your current situation? Explain what you should do in the next few rounds?

3. Explain Strategy Positioning and Operating Effectiveness? Provide an example.

Answer 1

Actual production volume = 50000units

Sales = 40000 Units

Actual production volume = 50000units

Sales = 50000 Units

It means that it is ideal order quantity the company is producing as it has no inventory holding cost. It is the optimal number of units as cash flows would be under control and no cash would be tied up pertaining to inventory holding and the order can be repeated again in few cycles as required.

Strategy Positioning means to do better than the competitors in a different way and Standing out in that industry, like providing quality products and better services at the same cost with distinct services which others are not providing, like a car company positioning itself in the market as a luxury car company or pocket friendly company. Operating effectiveness is doing better that what is done by company previously inside the company and growing better and better in the industry. In terms of operating efficiency, if the company implements quality management processes by benchmarking standard and change the management if required for the smooth and efficient running of the organization