1. Although there are many marketing variables that impact the success or failure of strategy-implementation efforts, two variables are central to the process. What are these variables? Discuss why they are so important
The variables are:
• Market segmentation
• Product positioning
Market segmentation
This variable is essential since it puts into consideration the needs of diverse clients into distinct categories (David, 2008). The buyers have specific needs which prompt the marketer to come up with sound criteria to satisfactorily meet all the clients’ needs. Mainly, the clients may be classified according to gender, age and location. This variable enables strategists to plan adequately on market fragmentation which is adversely affected by lifestyle changes among particular groups, for instance, youth’s fashion (David, 2008). In formulating workable strategies, a marketer needs to put into consideration what a particular client group is, for the product one is willing to sale. Since marketing is a venture which needs careful calculated risks to shun all chances of losses and keep a competitive edge of the firm.
Product positioning
The variable emphasizes mostly on the product’s unique features which will make it stand out among the competitors’ same goods (David, 2008). Strategists concentrate on impacting the product or services with added designs, which competitors’ goods in the market do not have. This mainly involves capturing the mind-sets of clients into believing that a particular organization’s product or service is better than the others in the market. The “added values” or “features” are what the strategists concentrate on in “product positioning” to highlight unique features which the client will notice among other merchandise (David, 2008). This variable is essential since it contributes in maximizing sales as well as profits.
2. Explain how to perform a projected financial analysis.
The procedure involves six steps which facilitates a firm to predict the expected results after execution of formulated strategic decisions concerning sales. They include:
I. Initially, it requires preparation of “income statement” prior the “balance sheet” which starts by forecasting sales approximately close accurate.
II. Applying sales percentage technique, the project cost of goods sold (CGS) plus expensing objects in the income statement. For instance, suppose CGS was 70% of sales in the year before, then this is applied to compute CGS of the coming year. Computations like taxes, interests, plus dividends are treated separately, since they cannot be predicted like other items. These are beyond the enterprise’s control as they depend on government’s strategies.
III. Compute the projected net income.
IV. Deductions are done of any dividends, which ought to be salaried within the stated period to remain with Retained Earnings (RE). This must appear on both sides of income statement plus balance sheet. Thus;
RE = NI – RE; Where RE = is cumulative figure.
V. Show balance sheet entries, starting with RE, predicting stockholder’s equity, all liabilities together with total current, Fixed plus total assets. The cash account is utilized as plug figure in the calculation to make assets total liabilities and net worth.
VI. The “projected statements” must bear comments or remarks list; showing alterations occurred or made in the prior period or year. This is vital for future reference since it will be utilized not only once but numerous times to clarify some adjustments which may seem not understandable. Projected financial analysis is of very vital in an organization since it depicts the financial health of a firm from previous, present and future estimations of the future (David, 2008).
Reference
David, F. R. (2008). Strategic Management: Concepts. 12 Ed. United States of America. Prentice Hall.
