Clear Hear Manufacturing
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- Date Submitted: 07/30/2010 07:03 PM
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Recommendation to Clear Hear Manufacturing
Change in technology has rapidly created a competitive market where companies’ CEO are in “war” with each other. ‘40 years ago, a company competed with another company located just down the street, today that company competes with an organization from another continent.” To survive and compete in this new global marketplace, organizations must understand both their customers and their competitors. Clear Hear, a cell phone manufacturer, meets factory standards and makes a good profit; however, the company does not operate to its full capacity: over the next 3 months, Clear Hear will have an excess of 70,000 cell phone units (University Of Phoenix, 2009). These 70,000 cell phones, if not sold, might place Clear Hear in deficit because variable costs are already used to build these phones. This paper will identify alternative strategies that Clear Hear can adopt to reduce cost, achieve ideal production levels, and, finally, adjust fix and variable costs to maximize profit.
INCREASING REVENUE
Successful companies have a business operation model designed to maximize company profit. Clear Hear needs to put some marketing strategies in place to increase profit: for instance, the company needs to create a well designed website that can generate a large volume of traffic. The more people who visit the website, the more likely the customers will buy company product. To survive in this global competitive economy, the company needs to increase its number of customers, sell at a price lower or equal to the competitor’s price. Selling at a lower price can increase revenue for Clear Hear if demand for cell phone increases. Original Equipment Manufacturer (OEM) is considered one of the toughest competitors to Clear Hear because this company is in a position not only to supply 100,000 cell phone units on short notice but for a nonnegotiable price of $14.00. How OEM is able to operate on a reduced price compared to the $20.00 per...
Change in technology has rapidly created a competitive market where companies’ CEO are in “war” with each other. ‘40 years ago, a company competed with another company located just down the street, today that company competes with an organization from another continent.” To survive and compete in this new global marketplace, organizations must understand both their customers and their competitors. Clear Hear, a cell phone manufacturer, meets factory standards and makes a good profit; however, the company does not operate to its full capacity: over the next 3 months, Clear Hear will have an excess of 70,000 cell phone units (University Of Phoenix, 2009). These 70,000 cell phones, if not sold, might place Clear Hear in deficit because variable costs are already used to build these phones. This paper will identify alternative strategies that Clear Hear can adopt to reduce cost, achieve ideal production levels, and, finally, adjust fix and variable costs to maximize profit.
INCREASING REVENUE
Successful companies have a business operation model designed to maximize company profit. Clear Hear needs to put some marketing strategies in place to increase profit: for instance, the company needs to create a well designed website that can generate a large volume of traffic. The more people who visit the website, the more likely the customers will buy company product. To survive in this global competitive economy, the company needs to increase its number of customers, sell at a price lower or equal to the competitor’s price. Selling at a lower price can increase revenue for Clear Hear if demand for cell phone increases. Original Equipment Manufacturer (OEM) is considered one of the toughest competitors to Clear Hear because this company is in a position not only to supply 100,000 cell phone units on short notice but for a nonnegotiable price of $14.00. How OEM is able to operate on a reduced price compared to the $20.00 per...