Thursday, February 14, 2008

Period 4

Despite exceptional performances by SOLD and SOBO (both had 50% plus growth in volume sold), we dropped to 2nd this period. SONY did not sell well this period and that really hurt us — there is a large amount of inventory leftover. Significant repositioning of this product will have to be the top priority for next period.

We noticed that Team I is starting to jump up the stock price index and they have moved into 1st this period. We are weary that we must protect our competitive position and make some attempts to curb Team I’s rapid progress. Because we do not have enough budget to complete our R&D for our Vodites, we will allocate part of the required budget to PVOVO (not the PVOLT because we believe that PVOVO, a mid-range product would require less modifying in the future than would a low-end product) and then dedicate the remaining difference next period. We may be losing the first mover advantage but our risk-adverse management team is looking for more stable profits so as to maintain our stock price for fear of it dropping even further down.

Planning ahead, we are also developing two new R&D feasibility studies (PSOHO and PSOBE) this period hoping to modify SONY and SOBO upon R&D completion. These modifications would help us better target SONY and SOBO to the Singles market, which is showing drastic growth in the coming periods according to the market forecast we purchased.

So that’s a lot of R&D projects…and they are expensive! We will have to cut advertising costs next period in order to spare money for all of the R&D that is on the go. At this point we feel that R&D is a key strategic tool in terms of evolving stagnant products and realigning them with new, growing segments. We are also ordering less Vodites research studies this period. This is going to be a sacrifice of short run sales for long run profits. We believe it will be more valuable to the company’s overall success to go with this strategy. We know that this is going to be a hard time for our company but we are committed to long term success and not just short term gains.

4 comments:

SOLD said...

Okay, so in case y’all didn’t notice, there is absolutely no inventory of me left over from last period. Do you know what that means? Y’all need to be more risky with how much you produce! You are missing out on some good wholesome dollars! I will admit that a 50% increase in sales and obtaining the most market share for the Others segment is pretty impressive…BUT y’all could have achieved so much more! So next time, can you try and make a little more of me? Thanks.

Toodles,
SOLD

SOBO said...

So once again I’ve dominated – it is definitely because of me that we’re doing so well. I’m pretty much dangling in between the wants of both Singles and Buffs – they’re just not understanding my qualities, perhaps I’ll flaunt myself in front of the many Singles out in the market – we all know how much they’re dying to get a piece of me. Just a trim to both my price and weight I shall fit what they want. I’ll need to boost up my advertising to make me let them know how prestigious I am and without doubt I’ll be sold out – love me or hate me (but I know you all LOVE me)!

SONY said...

Um… hello…it’s SONY here…*sigh*… I’m such a failure aren’t I? No one loves me, no one wants me…and I’ve caused a loss in our company of more than $2,000,000! I’m straddled in the middle of nowhere between Professionals and Buffs because no one believes my characteristics to be right. I really don’t know how much longer I’ll be here… I don’t even know if I’m worth keeping around…

SONO said...

It really does amaze me just how often I am right! Well, what can I say, except that those Hi Earners certainly know how to make me feel appreciated, because I sold out AGAIN! However, I am getting a little worried that perhaps my popularity may start waning in the future, so it’s high time I kicked off a good ol’ marketing campaign. Nothing like an increase in my ad budget by $100,000 to make people remember who I am. HAH! And just to really make sure I am all that Hi Earners could possibly want, I am shifting my MDS dimensions just a little so that my performance is at 3, and my conveniece is at 8. See you all next time!

XOXO SONO