Competitive Position
Drypers holds a competitive position in the market because they have product innovation. With the great features offered with their products, they hold a solid positon in the market. Although their products are premium quality, they’re sold at great prices that consumers love.
Price
Drypers Corporation has retail prices that are often 40% lower than premium-priced brands for comparable items. Their diapers are equal to other national brands, just offered at a better price.
Product
Drypers has demonstrated a strong ability to differentiate themselves with their product innovations. The company introduced diapers that focused on skin care, diaper fit, absorbency, and leakage control.
Promotion
Drypers relies heavily on
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Having a large market share can be very helpful because companies earn more money to produce more. They also create brand loyalties even if they increase their prices. However, companies who have large market shares often times do not provide a lot of innovation. These companies usually feel they don’t need to get ahead because they hold such a big share in the market. This sometimes hurts their brand because when new products enter the market with cool features, consumer are likely to be engaged and …show more content…
This is meaningful because with a small share of the market (5.43) Drypers percentage points are the same as Kimberly Clark who hold 41.2% of the market share and Procter & Gamble who holds 37.7 % of the market share. If Drypers spends the $10 million, they will hold 5.43% of the market. Their percentage point would be 1.84.
Need to Achieve
In order to cover the cost of an expenditure of $10 million for 1998, Drypers will need to achieve $25,773,195.88.
Contribution Margin = (Net Sales –COGS)/Net Sales
= (100%-61.2%).100%
=0.388
Contribution Analysis - $10,000,000/0.388
=$25,773,195.88
About $25.77 million dollars will be needed to break even. Since the total sales from 1997 were $287 million, there would need to be an increase of 8.98% in sales to breakeven. Looking at the domestic sales from 1997, it equaled to $191.3 million, therefore, an increase of 13.47% would be needed to
As the private brands may not achieve or maintain market acceptance these brands may provide the adverse results expected. Financial condition and results of operation can be negatively affected if pricing, quality and other factors are not up to customer’s satisfaction levels. With all brands sold by Dollar General there is the unfortunate shrinkage that may occur. Profitability may be negatively affected by inventory shrinkage and the inability to properly manage the inventory balances. Effective inventory management is a key component of Dollar General’s business success and profitability. If the company’s buying decisions do not accurately predict consumer trends, excess inventory will negatively affect financial results. Inventory turnover has improved and the company is aware and focusing on addressing all of these risks in the most productive way possible. The biggest risk that the company is facing from a consumer’s perspective is that their sector is highly competitive. Operating in a basic consumer goods market there is already a strain on margins, and low prices are necessary to stay competitive. This restriction on increasing prices may result in a loss when costs increase. The objective is to keep overhead, salaries, marketing and all costs to a bare minimal. Other competitors have saturated the geographic market where Dollar General once was
The 3 percent decline in sales causing a 21 percent decline in profits can be attributed to the identification of the accounting concept of operating leverage. Operating leverage is what business managers apply to boost small changes in revenue into sizable changes in profitability. Fixed cost is the force managers use to attain disproportionate changes between revenue and profitability. Therefore, when all costs are fixed every sales dollar contributes one dollar toward the potential profitability of a project. Once sales dollars cover fixed costs, each additional sales dollar represents pure profit. A small change in sales volume can significantly affect profitability (Edmonds, Tsay, & Olds, 2011). So, therefore, if sales volume increases,
In general the customer bargaining power is low and therefore it raises the potential of market's profitability. Though, most of the companies provide "buy-backs" and price protection that lessens the chance to cash on moderately strong manufacturers position.
Under the ABC method, the Geoffrey doll has a very high contribution margin. It would be beneficial for G.G. Toys to increase their advertising campaign to focus on the Geoffrey doll to increase the sales margin. It would also be beneficial for the selling price of the specialty doll #106 to be increased as its true contribution margin was revealed through the ABC method. The contribution margin of the cradle remains consistent, very high, as it is the only product being manufactured in the Springfield plant. Since dolls are often sold with cradles as a package it would be profitable for G.G. Toys to consider pairing the Specialty doll #106 with a cradle in an effort to increase the profit margin of this doll. Bundling products will increase the average sales price for every order. Looking ahead, I recommend that G.G. toys continue in their market research and analysis of each product which will help them to plan for future demand. It would also be beneficial to stay informed of competitors and their pricing. Knowing the competition will help G.G. Toys to understand exactly what their competitive advantages are and help to target their efforts in that marketplace. This will increase their return on their marketing investment and increase their sales yields (Grev,
Assume required profit is equal to selling, general and administrative expenses so after expenses they will breakeven.
Lululemon’s has to produce and sell 150,000 jackets in order to cover their total expenses, fixed and variable. At this level of sales, Lululemon’s will breakeven (profit = loss).
Due to the various options of distribution channels their prices vary. Consumers take that into consideration when purchasing their products.
One thing I like about Nike is how accessible it is. You can find Nike products just about anywhere such as Nike outlets, Dicks Sporting Goods, Khols, Macy and other big department stores, as well as online. Some companies don’t make it as easy to find and buy their products which can be a struggle. I hate when I’m in need of a certain product but companies limit their access, and I can’t get what I need when I need it. Nike makes it easy to find and buy their products at any
When and if one of the dryers ever stopped, I planned to rush over to it with my shopping basket of damp clothes. Understand, IR...
Proctor & Gamble understands the high competition that already exists in the toilet paper industry, but feel that new Bounty Toilet Paper will change how this industry is geared. In recent times, toilet paper producers have stressed comfort and style in the production of their products, but as the times have changed, the American public is now more interested in getting the job done in the shortest amount of time with the smallest amount of the product. P&G have produced Bounty Toilet Paper because of this change in the lifestyle of Americans. With this focus on effectiveness and durability, Bounty will go into the new Millennium leading the toilet paper world.
612,000/85,000,000= .0072% (~3/4 of 1% of revenues in 1-200hp market { what % is 5-10hp sales?})
To breakeven, we would have to sell 267,857 units. We plan on selling the Galaxy Note 8 at a price of $499 which is cheaper than our previous phones in the Galaxy Note line. Consumers aren’t going to purchase a new smartphone if the price is going to be in the same range of the Galaxy Note 7. So we are going to be selling the smartphone at a discount. We are using odd-even pricing for the Samsung Galaxy Note 8. It gives a sense to the consumer that they will be purchasing the Samsung Galaxy Note 8 at a bargain, instead of using the even pricing method. The cost to make the smartphone itself is around $275. There will be a picture below that will explain the details of the build of the smart phone. For the breakeven I subtracted the Total Cost from the Total Revenue. The profit for year 1 will be $1 billion dollars, I subtracted the total revenue for year 1, which was $1.06 billion and subtracted that number by the fixed cost amount of $60
Thirdly, the company is committed to delivering superior quality of products and services. It earned a reputation of a convenient and reliable brand that offers the lowest prices, one of the fastest and lowest shipping, widest selection of goods, and many additional features with its services.
Despite there being a stable state established in the market of pampers, there have been variations in the way that the products of this company have been demanded from their manufacturing companies (Christopher, 2016). On having a closer look at the differences and swings in the way that demand is made in this organization, it was clearly found out that the differences in demands were greatly affected by the ordering practices of the product retailers. The way that wholesalers, and other product distributors acquired the product also resulted to some variations being experienced in the market (Simchi-Levi, Simchi-Levi, & Kaminsky,
Technologies and Innovation: WeTrust will constantly look for technological up-gradations and innovations, in order to provide high quality services and create opportunities for advancement.