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Introduction
As the company under consideration by Andres, the organization will be reviewed through relevant assessment indicators. In particular, the focus will be on its progress and performance to date. Based on the data on the production process, market segmentation, and financial performance, key conclusions will be drawn regarding the outcomes of the work conducted in relation to its two products. For ease of perception and convenience, visual tools will be applied. According to this analysis, one can identify the effectiveness of such a valuation strategy based on the assessment of the main aspects of market activity.
Product Description
To obtain a comprehensive picture of the companys marketing, production, and financial aspects, a basic description of Ables and Aces needs to be given. The company is positioned as a high-tech organization, and as a forecasting tool for marketing resources, a perceptual map is displayed. According to Daabes and Kharbat (2017), this instrument is a practical intelligence framework that aims to reflect customers perceptions (p. 360). For ease of analysis, another company, Ace, is represented in this map, and its profile is low-tech. As a result, the visual display helps determine whether the companys product is in line with customer interests.
While taking into account the data from the map, one can make relevant conclusions. Firstly, compared to Ace, Able demonstrates higher rates of customer interest and is within the acceptable range of buyer preferences. At the same time, at the moment, the product is not in sufficiently high demand, as evidenced by the fact that Able, like Ace, does not fall into the black circle. Hence, one can argue that, in a couple of years, the company will achieve greater success. In addition, if the organization grows, this will be a positive driver to stimulate Ables sails faster than Aces ones.
Production Analysis
Based on the presented production schedule, Able produces more units than Ace. The twofold difference (1,600 and 800, respectively) is reflected in the aforementioned perceptual map. At the same time, capacity indicators are identical for both products, which is reflected in the diagram in Figure 3. One can note that, over the years, capacity growth has not become significant, which indicates that more efforts need to be made to optimize the production process. In addition, Ace manufacturing should be strengthened to increase customer interest and sell more products to meet market demand successfully.
Despite a clear development strategy, the automation rating of both Able and Ace is 3.0. This parameter is not high (10.0 is the maximum), and innovation stagnation is one of the reasons. Due to the lack of sufficient investment, the company cannot modernize its production at the proper level. Moreover, based on the assessment of the previous indicators, for instance, product scheduling, there is no consistency in the organization. For both Able and Ace to achieve the desired growth outcomes, more attention needs to be paid to investors.
Market Segmentation
The analysis of market segmentation reveals the similarities and differences between pricing and budgeting policies in the company. Based on the data comparison, the promotional budget is higher for Able $2,500 compared to that of Ace ($1,500). The sales budgets have the same ratio $2,500 and $1,500 for Able and Ace, respectively. The key takeaway is that more money is spent on promoting and distributing high-tech products than on low-tech ones. At the same time, Ace has a higher price than Able $41.50 and $35.00, respectively, which may mean that it requires more expensive production.
The sales and revenue forecasts for both products are based on the indicators of the budget and contribution margin. For Ace, the latter parameter was not identified, and the sales forecast was not performed; for Able, this indicator was low. Nevertheless, the revenue forecasts were calculated for both products $45,407 and $3,000 for Able and Ace, respectively. Regarding the accounts receivable and accounts payable implications, the figures were unpromising 67.7% and 1.7%, respectively. As a result, the companys marketing decisions were not adequately justified.
Financial Performance
Based on the financial analysis performed, one can note that the company did not have a successful promotion program for its products, which was planned as a development strategy. The borrowed loans did not allow for building an independent budget, and loan payments were large. At the same time, the companys assets are not stored in cash, and all the operations are carried out in the stock market. The product promotion strategy should be enhanced due to relevant investment and innovation.
Conclusion
The product promotion strategy needs to be strengthened not through loans but through effective solutions in the areas of innovation and investment to meet the current market demand and customer interests. In this regard, more marketing channels should be sought to attract more funds. To prevent worsening the situation, the company should avoid loans and pay off the existing debts as soon as possible. This will allow concentrating on the internal budget and distribution of assets more competently.
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