Business Studies, asked by rupinderbhinder, 10 months ago

OR
Amit force Limited was in the business of manufacturing treadmills and had a
monopoly in the market. The business was doing very well and company was consistently
able to meet its objective of 20% increase in sales year after year. Encouraged by good
track record, Mr. Akhil, the Managing Director of the company, kept and ambitious target
of 30% increase in sales for the next year. The same year, two competitors entered the
market and the company could not achieve its targets.
Identify and explain the limitations of one of the function of management because of which
the company was not able to meet its targets.

Answers

Answered by Satchandi

The company was involved in the commercial business of treadmills and it enjoyed a monopoly. Furthermore, it was enjoying an increase in its sales target of 20% year-on-year and the Managing Director kept an ambitious sales target of 30% for the next year.

We have additional information that two new competitors entered the market.

It is provided that the company enjoyed a monopoly previously, but now it has two more competitors in the market. Furthermore, it also has an over-ambitious target of 30% sales, which is ten percentage points higher than the actual 20% in the previous years.

Because of competitors, its sales are likely to drop.

There was a lack of overall planning and organising in the entire process.

If it had kept a target of 30% sales, there should have been:

1. Increased promotion

2. Correct transaction price

3. Identifying of new consumer pockets

4. Better campaign management

5. Improvement in quality

6. Overall better service

There was a lack of planning and directing because of which it failed to achieve its targets.