Assignment - Session 1 _ Manish
2
Submitted by: Submitted to: Manish Prof. Prakash Bagri EPGP 2014-15, Term VI MWHTI Brief Case Analysis of ‘ THE CASE OF PROFITLESS PC’ April 28, 2015 1. What as per your analysis should Praxim do ? Why ? Answer : Praxim should take the following steps • Task of improving bottom line without loosing on sales as up market had now being stagnated and the scope for growth is little • Segmentation based on consumer’s needs can result in market penetration and increase in consumer base will give economies of scale reducing marginal costs. • Bundled boxes with ( software and other services) will satisfy more customers and will increase revenue also. • Investing in specialty stores, where a premium can be charged thus increase in margin can be gained and thus profits will increase. • Season offers can be introduced, by charging premium differently for different set of consumers. This kind of focused approach will increase retail customer base within short time. • Introducing PC customization for consumers, It will reduce inventory cost as well as procurement cost as it will be JIT inventory. 2. Which strategic models did you use to analyse the situation ? Answer : I used Porter’s 5 forces model to analyse the situation.
-
Upload
manish-sinha -
Category
Documents
-
view
12 -
download
7
description
The profitless PC strategy and solutions to be adopted.
Transcript of Assignment - Session 1 _ Manish
Submitted by: Submitted to:
Manish Prof. Prakash Bagri
EPGP 2014-15, Term VI MWHTI
Brief Case Analysis of ‘ THE CASE OF PROFITLESS PC’ April 28, 2015
1. What as per your analysis should Praxim do ? Why ?
Answer : Praxim should take the following steps
• Task of improving bottom line without loosing on sales as up market had now being stagnated and the scope for growth is little
• Segmentation based on consumer’s needs can result in market penetration and increase in consumer base will give economies of scale reducing marginal costs.
• Bundled boxes with ( software and other services) will satisfy more customers and will increase revenue also.
• Investing in specialty stores, where a premium can be charged thus increase in margin can be gained and thus profits will increase.
• Season offers can be introduced, by charging premium differently for different set of consumers. This kind of focused approach will increase retail customer base within short time.
• Introducing PC customization for consumers, It will reduce inventory cost as well as procurement cost as it will be JIT inventory.
2. Which strategic models did you use to analyse the situation ?
Answer : I used Porter’s 5 forces model to analyse the situation.
Analysis : Forces Factors Degree
Industry RivalryNo of competitors
Medium to HighSize of Competitors
Brand Value of Competitors
Threat of New EntrantsCapital Required
Medium to HighBrand Acceptance
Threat of SubstitutesSwitching Cost
Low to MediumPrice of Substitute
Performance of Substitute
Bargaining Power of SupplierMarket Share
Low to MediumSize of Supplier
Bargaining Power of Customer / Buyer
Switching CostMedium to HighPerformance & Cost of product
Volume
3. How has the PC industry evolved since 1998 ?
Answer : The PC industry has changed a lot since 1998 as there is no domination of 1 or 2 players in this industry. There are no. of competitors competing through various resources and giving different types of value addition to different segments of customers. Some other key changes in PC industry since 1998 are
• Margins on products have shrink due to fierce competition.• The demand for new products & technologies have increased, which encouraged new entrants.• Prices heads southward direction as the profits also.• From a niche product it has become more commoditized product.• Many new companies have joined the industry with new offerings and customer segmentation.• The product life cycle has become short and new products keep coming more frequently.
