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For most enterprises, new products are pivotal for sustainable growth. Wrigley Corporation launched Juicy Fruit in India. This move is in line with the company’s goal to reinforce its product range within India and increase its presence in the chewing gum business sector. This paper highlights the marketing strategy, the design and innovation Wrigley Corporation put in place in order to infiltrate the Indian market. The analysis of Indian consumer trends influenced the manner in which the Wrigley Company introduced Juicy Fruit in India. For instance, before launching Juicy Fruit, Wrigley Confectionery positioned its brand based on Indian consumers’ dental and enjoyment needs. Wrigley took advantage of India's growing investments in the chewing gum industry sector to promote and launch its Juicy Fruit product. Juicy Fruit came in various brands thus capturing a larger market. The incorporation of a skilled workforce, brand position to fit the consumer needs of different people.


 The launch of Juicy Fruit was a major step in Wrigley’s India journey and demonstrated the firm’s commitment to increasing its market share in that particular region. Wrigley Corporation had previously made substantial inroads in India’s chewing gum industry. In the previous years, Wrigley had already launched Skittles and Candy hence the Indian market was familiar with its line of products. It is vital to note that Juicy Fruit gum was locally designed and priced to meet the consumer needs of the Indian market (Wilner, and Ghassan, 2017, p173). This way, the company was able to connect marketing innovation and market performance. According to Phillip Kotler, marketing is the discipline and skill of discovering, generating, and delivering value in order to satisfy consumer desires and make a profit in the process of doing so. Besides, the author claimed that marketing innovation is the application of new marketing mechanisms including significant alterations in terms of product design, branding, item placement, advertisement, and even pricing. In context, of the two terms defined above, market performance is the outcome of the policies mentioned above- the association of retailing value to expenses, the output volume, and production effectiveness, advanced technologies among other issues.

Wrigley’s Background

 Wrigley began its business operations in 1891. The company is situated in Chicago Illinois. Wrigley’s is registered under Mars Corporation implying-Mars Corporation owns all of Wrigley’s commercial products. Initially, the company was known for manufacturing and selling cleaning soaps and baking powder (East et al., 2016, p203). Later, it packaged its soap and baking powder with chewing gum. Over the years, the chewing gum becomes more popular than the soaps and baking powder forcing the company to change tactics and venture fully into selling chewing gums. Mars Corporation acquired the company in 2008. Wrigley's chewing gum is one of the most famous chewing gums in the world and its sales are sometimes compared to food brands.


 The objective of this research is to explore the Juicy Fruit’s marketing innovation and then link it to market performance in the Indian chewing gum market. In the process of examining these underlying factors, the paper will explore consumer trends that might have motivated the investors to launch Juicy fruit. Also, carrying out a market performance assessment of the Juicy Fruit will be the key area of the study and key in the determination of the conclusions.

Part A

Changing Consumer Behavior

Consumer Trends

Wrigley’s Launched Juicy Fruit in India In 2019

Increased Chewing Gum Sales

Even though Wrigley’s had experienced dismal growth in the sales of some of its products, the company’s chewing gum sales increased yearly. It is vital to note that the company did not have a chocolate product, the non-chocolate sector grew by 16% which in turn signaled the shift from chocolate products to chewing gum. Hence, indicating the need to quickly fill in the chewing gum gap and by doing so, meet the needs of the consumers (Creţu, and Mihai, 2018, p41). The market growth revealed that India’s chewing gum industry is still at its infancy stage and needed a brand name that would influence the range of products being sold within the chewing gum niche. Therefore, the company had to take advantage of the opportunity and introduce a product tailored to fit the market needs of the target market. As stated earlier, India's chewing gum market is not yet fully developed hence the penetration is minimal. Increased investment only meant that the consumer base is growing. The main objective of Wrigley is to trigger market growth and the only way to grow the market is by increasing consumption and penetration. The chart above clearly demonstrated the steady growth in India’s chewing gum industry hence forcing the introduction of a locally produced Juicy Fruit.

The Increasing Demand for Useful Chewing Gum

 Before one can produce a product, one needs to ask himself, the role the product will play in the lives of the people. Indians use chewing gum for freshening the mouth. The role of the product creates relevance which then drives the demand and the need for the product in people’s lives. Juicy fruit would target smokers, people suffering from halitosis, and other types of consumer groups. Employees normally purchase chewing gum in bulk and store them in desks in order to refresh their breath now and then (Kalra, and Soberman, 2010, p301). Case studies show that 60% of Indians use chewing gum for mouth freshening purposes hence Juicy fruit would come in various variants which would help Indians meet this need. In other words, the function of chewing gum helps in strengthening the teeth and solve mouth odor problems hence pushing sakes up.

Sugar-Free Chewing Gums Triggering the General Market Expansion of the Entire Chewing Industry

 Sugar-free chewing gum is a growing trend. Instead of just taking advantage of sugar-free chewing gum, the company saw it fit to produce both sugarless and flavored chewing gums. India remains one of the most populous nations around the world and providing a variety of chewing gums may help in growing the market and pushing up sales. Markets thrive on options given to consumers (East et al., 2008, p280). If a consumer has more than one option, he or she is likely to try both a sugar-free option and a flavored chewing gum. More so, Juicy Fruit would come in various products in an attempt to capture the market needs at once. The per capita consumption for Indians is six balls per individual annually. This signifies increased frequency and promising growth in the near future.

The Need for an International Product with Local Characteristics

 The item was locally designed to fit the daily needs of Indians and was then affordably priced (Narwal, and Kumar, 2011, p113). The Juicy Fruit was manufactured from the Wrigley Confectionery’s India factory hence was able to remain relevant and blend with the changing environment.

Stiff Competition

 The chewing gum market niche is extremely crowded with well-known corporations taking 60% of the profit returns. Competition forces the companies to think out the box consequently driving innovation. The open and competitive environment forced the market players to change tactics and adopt more effective manufacturing techniques which led to innovative and upgraded chewing gums. In this particular case, the Wrigley brand had to launch a Juicy Fruit as a way of leveling the competitive playing field and gaining momentum (Fernie et al., 2015, p121). Subsequently, competition influences water and energy. Demand and accessibility to these resources affect pricing which may end up impacting marketing and quality of the final product. Juicy Fruit combined raw materials effectively intending to maximize available resources. An innovative way of capturing market needs

Increment in Market Expenditure

 The reinvention of the chewing gum industry swayed investors to invest more in the marketing sector. Wrigley's Juicy Fruit targeted a younger consumer base. Through television advertisements, social medical platforms, and entertainment magazines, the company portrayed the chewing gum as a fun and bubbly product (Verganti, 2008, p436). By reinvesting branding and increasing expenditure in media promotion, Wrigley assisted in making Juicy Fruit a visible brand. Marketing changes perspective and consciously forced people to accept the Juicy Fruit brand as soon as it was launched in India. According to marketing reports, most people enjoy chewing gum but hardly prioritize buying it from shopping stalls. Branding would help to prioritize chewing gum as a necessity. Juicy Fruit increased Wrigley sales from 10% to 12% within a three month period partly due to marketing and innovative ways of branding the flavors. In terms of taste, the company decided to produce more sour taste Juicy Fruit flavors in order to capture 25 years old consumer market. Sour flavored chewing gum was more popular among the older consumers and Wrigley made use of marketing campaigns to portray Juicy Fruit as a pack of chewing gum with many flavors hence attracting attention from various consumers. For instance, the strawberry flavor had 5 pallet gums while sour apple flavor had one extra pallet gum hence making Juicy Fruit stand out as a brand. Also combining sweet and sour flavors appealed to a wider target market and appealed more to consumer needs.

  According to technology trajectory and escalator reports, Wrigley had concentrated heavily on chewing gum’s dental benefits hence missing out on the younger population market. Functional chewing should be partly dwelled on as it does not attract larger profit margins as compared to serving the younger populations which consist mostly of impulsive buyers (Bucolo, and Matthews, 2011, p137). Thus, the company invested in both functional chewing gums and fun category chewing gums.

Part B

Juicy Fruit’s Ingredients

Sugar, gum content, stevia, natural syrup, mannitol, natural flavors, 2% Glycerol, and lecithin. The chart below illustrated the content of Juicy Fruit chewing gum. In current society, everyone is conscious of their health. It is vital to note that the ingredients are natural and have no wheat or gluten content. Juicy Fruit is sugar-free and capitalizes on natural ingredients. There is no way one can gain weight from chewing Wrigley’s Juicy Fruit. Sodium and proteins are absent in Juicy Fruit content. The ingredients are in line with functional chewing gum trends (Hobday, Boddington, and Grantham, 2011, p16). Functional chewing gums concentrate on offering consumer sugar-free content to preserve dental health and preserve fresh breath.  Juicy Fruit chewing gum comes in tablet form and is manufactured from natural saps such as synthetic lecithin.

 Chewing gum rich in sugar may increases vulnerability to tooth disease. On the other hand, sugar-free chewing gums strengthen teeth and keeps diseases at bay.

 According to Juicy Fruit’s marketing design and innovation, Juicy Fruit had to attract both the younger consumers and the older generation. The younger consumers had a sweet tooth and the older generation was interested in freshening their breath and strengthening their teeth through chewing. The combination of sour a sugar-free chewing gums appealed to a wider market (Belz, and Peattie, 2009, p217). In terms of marketing design, the Juicy Fruit was portrayed as a refreshing and energized chewing gum. After researching in India, the company confirmed that the gum contained natural sweetness and significantly reduced bad mouth odor. Juicy Fruit helped in reducing stress because its taste influenced mood. The brand positioning centered on no particular group hence the investment attracted anyone who cared about dental health and simple pleasures. Juicy Fruit came in a variety of flavors which reliably upheld their objective to strengthen and preserve teeth. With a piece of Juicy Fruit chewing gum, a consumer could easily enjoy good taste and mouth freshness. Juicy Fruit is the most suitable solution for providing mouth freshness. Besides, holistic marketing ideas took into account all the Indian issues that the product might have faced. This helped in filling the trend gaps and draw out the strategic curve in terms of defining Indian organizational heritage. For instance, Indians working class can afford to buy a chewing gum for enjoyment even though they will not make it a routine to stick with the same brand. This tacit knowledge informed on the company’s decision making.

Short Narrative

Strategically producing Juicy Fruit chewing gums in variants such as chicle, sour-flavored and sugarcoated captured a wider market share. In return, an increased market share allowed the company to steadily grow and maintain its share in the Indian market. Usually going against consumers trends set a company against the dynamic capabilities of the market share. The role of aligning company objectives with consumer trends is to develop engineer the chewing gum based on familiar consumer preferences.


 Consumer trends

 Ingredient and properties

How it fulfills the trend

Increased demand for functional/useful chewing gum

Gum content, mannitol

Juicy Fruit comes sugarless flavors hence supplying the already high demand.

Functional/ sugarless chewing gum causing expansion of the chewing gum industrial sector

More people consuming sour flavored chewing gum.

Stevia is a natural sugar

Increased production of sugarless chewing gums and diversification of other flavors.

 The need for an international product with local characteristics

 Mannitol is a sugar alcohol derived from local berries hence increasing credibility among the locals

Designing the chewing gum to look bubbly and fun in order to capture the youthful generation and secondarily influence other generations.

 Stiff competition

 Use of quality ingredients such as natural syrup and mannitol.

Producing quality and affordable chewing gum.

 Increased marketing and promotion




Environmental Concerns Arising From Juicy Fruit Production

 Chewing gum can be used anywhere. Whether it is being used as a mouth freshener or on the park, chewing gums are poorly disposed of. Against this information, Juicy fruit worked in conjunction with other companies to kick off cleanliness awareness campaigns and then placed littering bins at different town centers to reduce chewing gum littering menace (Sarli, and Tat, 2011, p9). Gathering and then correctly disposing of chewing gums and packages helped in reducing environmental pollution within India.

Part C

Extensive Assessment

Wrigley Confectionary Juicy Fruit’s Indian-Asian branch experienced 60% growth in revenue since 2013. This translates to 3% growth per year. India is an emerging market consequently the remaining 40% of the market only accounts for 10% of Juicy Fruit sales each year. The quick paced growth within the emerging market is attributed to higher population growth rate, embrace of functional chewing gums and higher purchasing power especially among the youth. After the launch, the sales were also attributed to marketing and innovation. In the Indian chewing gum market, all Wrigley Confectionary sectors are tremendously growing at a rate of 30% from 2012 to 2015. The shifting opinions of Indian consumers is the key underlying reason for the growth.

  As per 2002 reports, Wrigley experienced an upsurge in sales which prompted them to expand their chewing gum business to other developing economies.  In 2019, the consolidated Indian or Asian sales increased to $153,161 which represents 15% growth. The reasons for analyzing Indian sales under the Asian category are to avoid distortion of the results and acquire a more holistic figure. Apart from the foreign currency conversion impact, the sale rates went up by 14%. Higher international delivery from India pushed up sales by 8%. Higher expenditure induced by international product mixture help in combining value and at the same time address consumer needs and trends holistically. Juicy Fruit was launched immediately Mars Corporation merged with Wrigley’s hence the rebranding gave Juicy Fruit an advantage in terms of market design (Verganti, 2008, p436). The marketing design was simple yet practical and this explains why the sales went up. The consolidated profit margins were $1,596,103 and increment from the previous years. The combined profit margin was 58.1% in 2019 hence declined by 0.4 %.

 In terms of general expenditure sales, the pricing was affordable and the fruity taste won the hearts of many Indians who then became loyal customers. As seen below, Wrigley made dynamic moves and increased both Juicy Fruit sales and those of its shareholders 24%. This implies that Wrigley's market performance and strategic management worked tremendously well to the point that the shareholders were able to cut a profit for themselves from the sales. In the end, this caused the sustainable growth of the Juicy Fruit product. The long term and short term impact of Juicy Fruit were analyzed at hand before launching the product hence all the risks were fully managed and no eventuality occurred during the entire Juicy Fruit production period in Indian borders. This way, brand loyalty made it easier for the company to make a profit and even widen the profit margins even after launching in a foreign nation. With the impact of sale promotion and discounted deals, consumers bought the product out of loyalty for Wrigley's instead of opting for cheaper products. Subsequently, expanding the key business activities was the priority and this was one of the reasons why Wrigley’s Juicy Fruit enjoyed robust growth in terms of transportation and retail sales annually. The consumers and retail feedback were equally beneficial in the modification into innovative sectors such as Juicy Fruit mint and menthol variants. Divert adds value and also increases the consumer range of the company portfolio. Diversity contributed to Juicy Fruit’s success in the Indian market. Combining these success factors produced an estimated 16% of the volume gain yearly. The rest of the volume was acquired through the strategic acquisition of Indian chewing gum brands. Business mechanisms and frameworks assisting order acquisition, transportation, and pricing were fulling incorporated in an effective 5 day period after the closure without the disruption of the entire supplies system. Production innovation measures commenced immediately hence coinciding with the manufacture of the chewing gum.

Part D

Recent sales performance product data

Juicy Fruit retailed at Rs 5 in India after the launch. In 2019, the year of its launch, the company registered 16% sales of the Juicy Fruit chewing gum. The chewing gum had a local taste with an international image. The consumption of the product was translated to 195 Juicy Fruit per month. In the past five years Wrigley confectionary invested 150 million in the Indian market hence pointing to 200 million returns after investment and launching of the new product. In the first quarter the company was able to garner an estimated 100 million from Juicy Fruit sales.

Competitive advantage

  Time plays a crucial factor in shaping competitive advantage. Wrigley confectionary’s Juicy Fruit has been in the chewing gum industry for more than a century. Longevity breeds familiarity and trust manifests into purchase which in turn gives Juicy Fruit an edge over other competitors. Additionally, time has given the Wrigley’s Juicy Fruit the resources and creativity needed to capture a wider consumer market. For instance, Wrigley confectionary launched its Indian factories in 2003 hence giving it more time to recoup and learn the Indian chewing gum market before launching Juicy Fruit bubble gum in 2019. Unlike its Indian competitors who may be limited in terms of experience and marketing strategy, Wrigley confectionary can create a universal appealing. To bring its corporate image into perspective, the company has branches in more than 78 countries and has numerous products under its brand name.


In summary, Juicy Fruit was launched in India in 2019. This was not the first time Wrigley was setting foot in India. Previously, the company had made inroad with products under the same chewing gum niche. In an attempt to capitalize on consumer trends, Wrigley’s manufactured functional gums together with Juicy Fruit. Juicy Fruit was market designed to look fun and bubbly thus attracted the younger generation who impulsively buy items. Also, the marketers placed Juicy Fruit gums at the supermarket exit sections so that shoppers may pick them up without second-guessing their options. Making use of increased sales to introduce both sour and sugar-free chewing gum increased the consumer base and catapulted results. Taking advantage of increased sales and visibility within the chewing gum sector to market and then launch a chewing gum product was innovative and helped the product gain familiarity. Combining both sour and sweet flavors created a new consumer base who then tried purchasing sweet and sour flavors. The company defined its market share through consumer experience and visibility as it catered to a wider market base compared to other chewing gum companies which only isolated a certain population. Juicy Fruit was able to effectively penetrate the Indian market through designing the gum to suit local needs and price it according to local prices. Creating a new niche and accurately meeting the dental and enjoyment needs of the people ensured the market thrive.





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Company Description

            Nestle Group is the world’s biggest food and beverage manufacturer in terms of revenues. The Swiss multinational is headquartered in Switzerland. Its portfolio of products includes medical food, baby food, breakfast cereals, bottled water, confectioneries, ice cream, dairy products, pet food, snacks, coffee, and tea. Annual sales of the group are approximately $1.1 billion with over 447 factories, 339,000 employees operating in 189 countries. The business also holds shareholding in other businesses such as L’Oreal.

Prepaid Assets of Nestle Group

            Prepaid assets represent expenses paid in one accounting period, but will not be recognized until a later accounting period. The prepaid expenses are shown in the balance sheet as current assets because of their future economic benefits. The matching principle of accounting requires that expenses are matched to the revenues in the periods they are realized. The two most common uses of prepaid expenses are insurance and rent. Prepaid rent is rent paid in advance while prepaid insurance is one which has not yet expired on the date of preparing the balance sheet. Hence, the balance sheet of the company reflects the unexpired costs of the prepaid expenses, while the income statements shows the expired costs.

            Nestle Group has a significant amount of prepaid assets unlike a small business. From the balance sheet of the company in 2019, the prepayments and accrued income were 498 million Swiss Franc, while in 2018 they were 530 million CHF (Nestle Group, 2019). The huge amount of prepayments is as a result of leases for premises, equipment, and unexpired insurance. The expenses paid in advance cannot be expensed in the current accounting period, because it would not be in line with accounting principles, thus they are shown as prepaid assets in the balance sheet. The group has to pay for leases for its factories and office space in advance to ensure business continuity and vend off other interested parties. It also has to pay for insurance for its employees in advance to ensure occupational safety and comply with laws and regulations in the various jurisdictions it operates.  















Nestle Group. (2019). Consolidated Financial Statements of the Nestle Group 2019. Retrieved from (Accessed 11 June 2020).



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IFarm Plc

            The conglomerate has its head office in the United Kingdom and subsidiaries in the United States, Germany, Italy, Jifi, Camaija, and many other regions providing useful farm equipment. Among the portfolio of its products include tractors, seed drills, ploughs, harvesters, balers among other farm equipment. Although the multinational accords some autonomy to its subsidiaries, it operates a centralized treasury management system from its London headquarters, meaning they have to seek ratification of their financial decisions before operationalizing them.

Part A: Hedging Alternatives Possible for the US Subsidiary

            In this particular instance, on 1st March 2020, the US subsidiary of IFarm Plc was seeking to supply two batches of seed drills to Belgian company Brux Plc. Because of the significant cost of the equipment, which is €5,000,000, Brux Plc sought terms to pay intwo installments of €3,000,000 on 1st June and €2,000,000 on 1st September 2020. The finance director of the US subsidiary of IFarm is now faced with a tough decision of choosing between three favorable decisions available to hedge against a reversal in the recent trend of the euro. The prevailing spot rate in the market as of 1st March is $1.10/€.

            The spot rate is the immediate quoted price of a currency, commodity, or security. It’s the current market value of an asset depending on the market forces of demand and supply and expected future valuation (Jon et al., 2012 p.111). The spot rate hence changes frequently sometimes showing dramatic swings especially in the current market condition of uncertain future because of the Covid-19 virus epidemic. Relevant headlines such as this are certain to result in dramatic swings, thus the need for the management to choose carefully among the hedging alternatives available.

Option 1: Hedge in the Forward Market

            Forward Over the Counter (OTC) agreements contract a party to exchange currencies at a future date at a specified exchange rate. In the offered forward contract, the 3-month quoted price for the company is $1.1060/€, the 6-month quote at $1.1130/€, the 9-month quote at $1.1134/€, and the 12-month quote at $1.1138/€. Despite its numerous advantages of hedging against future fluctuations in the value of the currency, there are inherent risks in using this strategy. One such risk is the default. The risk arises because the parties to the contract commit to performing the forward contract at a future date. One of the other party may be unwilling to exercise the contract as agreed, or may simply be unable to meet the obligations. The party to settle owes the other a net amount at the date of the settlement.

            In the forward alternative offered, Brux Plc will pay the US subsidiary a net amount of €3,318,000 basing on the 3-month forward exchange quote. Similarly, it will pay the US subsidiary a net amount of €2,226,000 on 1st September basing on the 6-month quote. If they agree to this, the Brux will strive to pay for the equipment ordered the net amount in the future.

            The OTC forward contracts for future delivery of products often settle in cash. The forward contract will enable the US subsidiary of IFarm and Brux to hedge, position, and arbitrage. Unlike simple future contracts, it will allow the management of both companies to customize the agreement according to the agreed currency, amount, and specified delivery date. However, forward contracts do not trade on a centralized exchange, thus resulting in an increased risk of default that they have to consider. The over the counter nature of the contracts also means there will be a level of difficulty in operationalizing one as they are mostly not dominant in the retail sector such as the sale of farm equipment.

            Forward contracting offers an important tool in the agricultural finance sector to secure food for the over 9 billion projected world population by 2050. Unlike futures, they offer a higher degree of market-based safety nets and longer-term investment period for sustainable growth for companies and the overall economy. However, the market suffers from risk factors such as price volatility, lack of established exchange systems, and weather risks that can result in either party not exercising the contract. Because of interest rate parity, it means forward hedges, though plagued by higher default rates, are the same as the money market hedges.

Option 2: The Money Market Hedge

            It is a technique of mitigating risk against fluctuations in currency by using the money markets (Ian, 1991 p. 945). The money market has liquid assets such as short-term assets including commercial papers, treasury bills, and banker's acceptance that the US subsidiary can borrow money from the Munich branch of HSBC at 8% and deposit. The money market hedge, however, offers a comparative advantage to retail investors and small businesses rather than large corporations such as IFarm in hedging foreign currency exchange risk. Regardless, the money market hedge works similarly as the forward markets hedge, but with a few alterations.

            The money market hedge may not be the ideal strategy for large corporations such as IFarm because of increased translation exposure. In the case of this transaction worth €5,000,000, the transaction exposure will be significant due to receivables dealt with or payments expected in euro foreign currency. Thusly, translation exposure will be much greater for the company as compared to a small retail business. It is also much difficult to set up than utilizing a forward contract or options.

            For the US subsidiary to set up a money market hedge, it will have to undertake some necessary steps. First, it will have to borrow €5,000,000 from the Munich branch of HSBCat an 8% lending rate enough to cover the present value of the seed drills to be delivered. The amount borrowed has to correspond to the present value of the deliverables because the foreign currency dominated loan and borrowing interest rate should be equal to the present value of the amount of deliverables. Secondly, the finance director will convert the foreign currency into US dollars at the prevailing spot exchange rate. Thirdly, the converted money will be invested in liquid short-term assets in the money market such as treasury bills and commercial papers at the prevailing market interest rates. Lastly, the IFarm US subsidiary will repay the lending rates from the Munich HSBC branch as the proceeds from the investments accrue. It will retain the principal sum borrowed and as the payments of deliverables become due from Brux, they will be paid to the bank because they are dominated in the same currency. The foreign exchange risk would have been mitigated through this strategy.

            Similarly, because the subsidiary will receive foreign currency payments at a defined period in the future, it can hedge in the money market using the following strategy. It will utilize the option of the loan from the Munich branch of HSBC receiving €5,000,000 equal to the expected payments due from Brux. It will deposit the loan in euro dominated money market securities. As the deposits mature, it will make the lending interest rate payments to the Munich HSBC branch and convert the principal into domestic currency at the prevailing spot rates to mitigate against future fluctuations in foreign currency exchange rates. When the payments for the seed drills become due from Brux on 1st June and 1st September, they will be remitted to the Munich branch of HSBC.

Option 3: Hedge with Foreign Currency Options

            A foreign currency option avails a right but not the obligation to the US subsidiary to buy or sell currency at a specified price either on before an agreed-upon date. However, the company estimates that in utilizing this strategy it will end paying up-front premiums of 12% on its capital. It is the maximum amount the company stands to lose while the buyers have unlimited earning potential depending on the swing in the market exchange rates. However, the subsidiary can deploy this strategy to minimize the losses resulting from changes in the direction of the exchange rates.

            The subsidiary possesses the option of utilizing the Put options which offer a strike price of $1.1000/€ for a premium of 2% per contract in June and $1.1000/€ at a premium of 1.2% in September. The prevailing current spot rate in the market is $1.10/€. The put options give the company the right to sell the underlying asset at the strike price, which the seller is obligated to buy at the same price. However, the company has the right to dispose of the assets before the expiry of the option. The company will utilize the put option if it expects the dollar to undergo appreciation in value against the euro. However, it will sell the options if they anticipate the dollar to devalue against the euro. The company will be at an advantageous position since they can maintain their “long” position while utilizing only a small portion of the anticipated premiums by holding the options to maturity. They can take also take a “short” position if they anticipate the foreign currency market to remain stable. However, this can result in disastrous outcomes in a downward market turn.

            If the finance director opts for a call option, the company will enjoy a strike price of $1.1000/€ for a premium of 3% per contract in June and $1.1000/€ for a premium of 2.6% in September. Call options will provide the company the right, but not the obligation to purchase underlying assets at the strike price during the specified period. However, if the spot rate fails to attain the agreed strike price before the expiration of the specified rate, the option expires to become worthless. The company will buy the call option if it expects the spot rate to rise and sell if it isto fall.

Recommendation on the Hedging Strategy to Adopt 

            Among the three alternatives available to the US subsidiary of IFarm for hedging, the best is the foreign currency options. Large multinationals such as IFarm prefer to use the foreign currency options because they have a limit to the downside risk and may only lose the up-front premiums. On the other hand, they have unlimited upside potential. Companies such as IFarm trading across diverse forex markets can use the option to hedge open positions they are holding in the forex cash markets. Compared to forward contracts, they have immediate settlement (Murillo et al., 2011 p. 1615).

 Multinationals also prefer the foreign currency options because it avails them a chance to trade and profit on speculating the market direction based on economic and political headlines. The company will adopt a trading strategy based on the call and put options they choose to adopt. Similarly choosing a reputable broker or platform for trading will determine the profit gained or loss realized. They can opt for decentralized forex exchanges where more varied options are available or centralized exchanges characteristic of stocks and futures.

            However, the foreign currency options market like forward market and money market hedging has its disadvantages including the high premiums charged on contracts. The premiums can vary widely depending on the strike price and the expiration date resulting in high costs on capital. Another disadvantage is the fact that there is no secondary market such that once a company buys an option contract, they cannot be re-traded or disposed of. It is also a complex affair with many fluctuating variables making it tedious to determine their value. The risks associated with this market include market volatility, interest rate differentials, the spot rate of the currency pair, and the period of expiration.

            Regardless, the advantages outweigh the disadvantages compared to the other alternatives of money market hedging and forward market. Depositing in a money market hedge is a complex process with adopting strategies difficult and volatile. As shown in the highlighted steps, the company will have to dedicate substantial time to make the strategies pay off in the money market hedging alternative. Equally, there is no established exchange market for trading in forward contracts making it difficult to operationalize one for large corporations such as IFarm. The subsidiary will also have to forgo any potential gains arising from future potential gains in the swings in the currency exchange rate.

            Hence, my recommendation is for the US subsidiary to adopt call or put options from a reputable bank that allows exercise for a period of up to three months. They will also seek multiple partial currency deliveries within the currency options (Shehzad, 1996 p. 439). It will allow the company to acquire exchange-traded options for standard quantities to diversify the risk of counterparty failure. Successful hedging will enable the company to survive the uncertain market periods ahead.

Part B: Alternative Sources of Financing for Expansion into Australia and New Zealand

            In early 2020, IFarm established a projection plan of expanding its market share in Australia by setting a new factory in the country. It also sought to tap a new market in New Zealand through faster supplies from the new factory. However, building the new factory and developing marketing and distribution networks would require a substantial investment of AU$450 million. Traditional sources of funding are not viable since the company is highly geared and subject to some prescriptions particularly in paying dividends and the main lender is concerned about aging debt. Hence, alternative sources of funding are necessary to realize this aggressive expansion plan.

            The report analyzes how IFarm’s capital structure can evolve to minimize risk and enhance corporate performance. Capital structure is a dynamic process that changes over time depending on internal and external factors. In the case of IFarm it is highly geared according to its forecast of expected profitability resulting in a risk-return compromise such as foregoing paying dividends and providing periodic cash-flow updates to its main lender.

            The corporation needs to raise alternative sources of capital away from its traditional mechanisms. It needs to raise alternative external and internal funding to build the new factory in Australia and establish marketing and distribution channels to the New Zealand market. To expand its market share, aspects such as research and development are important to fendoff the competition. While utilizing retained earnings is one of the utmost means of raising capital for expansion, its balance sheet is highly leveraged to the extent of receiving restriction in paying dividends to its shareholders. Regardless of how big companies may be, alternative sources of funding for expansion are limited for all businesses at all levels.

            IFarm can continue to forego paying dividends to its shareholders and retain earning to finance its aggressive expansion plan. Regardless of any internal and external pressures, the most basic source of funds and the most prominent should be selling their products and services for more than the cost to produce them. Instead of rewarding shareholders in the short-term with dividends and share buy-backs, the company can invest in the expansion plan and grow the business for future growth prospects.

            Another alternative source of capital the company can use is debt capital, which can be through lending institutions or through issuing debt instruments. The instruments include issuing corporate bonds, which allow the public to become creditors of the company. similarly, the company can seek bank loans from its main lender or other willing lenders available. The downside with using this is the company is experiencing cash-flow problems shown by the condition placed on the company by the main lender to avail periodic financial statements. Although the failure to pay creditors can lead to bankruptcy, the interest payments for debt capital is an allowable tax expense and is usually cheaper than other sources.

            The company can raise the required AU$450 million by issuing equity capital. IFarm can probably meet it’s the entire capital requirements for building a factory and providing marketing and distribution channels by selling shares to investors both internally and externally. Internally, the company can do the right issues that give existing shareholders and employees the first option of subscribing to issued shares. Similarly, the company can issue additional shares that both existing and new investors can buy. The advantage of using equity funding is that shareholders do not require interest payments as compared to bondholders and lending institutions.

Hence, through equity funding the cash-flows of the company will not be hurt further by having to make monthly, quarterly, or yearly interest payments. Similarly, the company will not be in danger of filing for bankruptcy such as in the instances when it is unable to meet its debt obligations to bondholders or lending institutions. The company can successfully raise the AU$450 million for the new factory in Australia and serve its targeted new market in New Zealand. The downside to this alternative method of funding is that existing shareholders are likely to be unhappy because of the dilution of their shares. They have to share future profits of the company with new shareholders who were not there previously. Furthermore, issuing equity capital to new shareholders means decision making in the company is likely to be slow and difficult because of the voting rights they avail. Hence, issuing equity capital despite its potential of availing the required capital for expansion, means existing shareholders forfeit or dilute their ownership control and share future profits.

A weighted average cost of capital (WACC) of IFarmreveals that the company is paying a lot of interest payments due to its previous over-reliance on debt capital for expansion (Didem & John, 2013 p. 60). Accumulating too much debt from lending institutions and corporate bonds can lead the company into trouble such as falling into administration, bankruptcy, or liquidation. However, not taking advantage of available growth prospects will hurt future profitability resulting from its reduced market share as competitors capture the targeted markets.

The main lender of the company may be willing to finance the project, if it is not willing to meet additional conditions on top of providing frequent updates on its cash flows. The additional conditions can include requiring improved equity contributions by the company's shareholders. The lender can also require IFarm to provide collateral through existing assets of the company or the new factory to be built. The lender is likely to finance the project because of the possession rights provided such that in case of default it can recover its loans. Credit guarantees condition can also enable the company to secure additional loans from its main lender. The guarantees work in a way that where the borrower defaults on the loan, the guarantor will compensate the bank a pre-determined part of the outstanding loan (Wallace, 1948 p.160).

Building a new factory in Australia is a sound investment that offers unlimited growth potential for the company such as the untapped New Zealand market. Retaining earnings may be the best alternative, but it is likely to be unpopular with shareholders in the long-term who will not be receiving dividends. Therefore, a mix of debt instruments, equity capital, and retained earnings will enable the company to meet its funding requirements for the aggressive expansionary plan.


Didem, K. & John, H. (2013). Aggressive Marketing Strategy Following Equity Offerings and Firm Value: The Role of Relative Strategic Flexibility. Journal of Marketing, Vol. 77, No. 5, pp. 57-74.

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Jon, D, Hyun, S & Jean-Pierre, Z (2012). ‘Endogenous Extreme Events and the Dual Role of Prices’, Annual Review of Economics, Vol. 4, pp. 111-129.

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Marketing Plan

Business Information

Universal Reprocess Company is a unique company which offers plastic bag recycling services all over the country. Over the past few years, the company has been able to recycle more than 3000 tons to plastic bags. As a recycling company, we are focused on achieving our goal of delivering the best and high quality products to our customers. Nonetheless, our main aim is to not only satisfy our clients’ needs, but to also protect the environment, as well as the society, through offering assistance in whichever way we can. In our 3 years of operation, we have been able to partner with multiple companies in order to help ensure we protect the environment and the society in different ways. Similarly, we are also committed in offering nothing but the best, in ensuring we meet all the safety standards, from recycling to protecting the environment.

Business Mission

            Our key objective is to support the society through providing ways through which it can be able to protect the environment. For that reason, the company has partnered with Chartered foundation, a non-profit organization, with the aim of encouraging the society to protect the environment through proper waste disposal. The community around the company has been exercise poor waste disposal, a factor which has led to the spread of communicable diseases. It is consequently necessary to come up with strategies to sensitize the society on proper waste management and disposal. We will consequently run a sensitization program which help in educating the society on the significance on managing waste. Similarly, the company together with Chartered Foundation will also offer financial as well as human support in dealing with the issue.

            The organizations leadership is focused on providing the best assistance to the society I fighting against poor waste disposal. It has therefore proposed the following ways to deal with the issue.

  • Educating the society on proper waste disposal.
  • Providing free garbage bins.
  • Purchasing used plastic bags from the community for recycle.
  • Cleaning the area around the company.
  • Producing durable plastic bags which can reused.
  • Offering financial support to the families affected by communicable diseases.

Goals of the Mission

            The company’s goal is ensure a clean and secure environment for everyone in the society. Secondly, protect the community from contracting communicable diseases through teaching them on ways on maintaining proper sanitation. Allowing the community to earn through purchasing used plastic bags which can then be recycled. Manufacturing durable plastic bags which will help the community in saving money through reusing the plastic bags, instead of purchasing new ones. Lastly, protect the health of the community and to encourage the members of the community to also participate in maintaining the proper wastage disposal within in the society.

Initiatives and Strategies of the Mission

            In order to make this mission a success, it is necessary to create an awareness plan. The company has consequently selected the social media, as well as posters as a means of creating an awareness for the program. The company will consequently run advertisements on different social media platforms. In addition, banners will also be printed and distributed throughout the region, hence enabling all the members of the society to be aware of the program. On the social media, the advertisements will run for the whole month. On the other hand, posters will be printed and posted around the region. In so doing, it will be easier for most people to know about the program.

            The effectiveness of this methods of creating awareness will be measured through analysing the number of site visits through the social media. A target number of audience is expected to the click on the social media, hence if more people than the predicted number click on the link, then the method of advertisement is successful.

Mission Contributors and their Responsibilities.

            All of the six employee teams in the company will required to take shifts in cleaning the town, and sensitizing the community on the significance of proper waste management. Every Monday each team will be required to participate in cleaning of the town. In addition, the management of the company, will also participate in the sensitization, whereby all the managers will be required to participate in the sensitization at least twice a week. Members of Chartered foundation will also participate in cleaning and the sensitization programs. Distribution of dustbins will be spearheaded by the company’s Chief Executive Officer (CEO). Lastly, the management of the company will also pay the hospital bills for victims of communicable diseases. A sum of $200 000 will also be given to the community, to help in ensuring the community remains clean. All the areas in and around the company will also be cleaned, and proper sanitation in and around the company will be remain a key priority. The program is expected to run for a period of two months, in order to ensure the community becomes accustomed to proper sanitation and waste management. The effectiveness of the program will also be measured from time to time.




837 Words  3 Pages

 OCHO, Otago Chocolate Factory


OCHO founder Liz Rowe founded the company in 2013. Fast forward moving the company has been committed to making good chocolate. The company is firmly rooted in Dunedin and this is where the company intends to stay. In 1979 Cadbury Schweppes Hudson was the first chocolate company to launch factory tours. Four decades later another chocolate company opens its door to the public.  OCHO Chocolate Company moved to a larger building on Dunedin’s waterfront after raising about $2m through crowdfunding in 2018 afterwards it launched its factory tours.  The main aim of launching these tours is to demystify the chocolate making. When the company started offering factory tours it immediately ceased to be a normal food and beverage company only, it’s now part of the tourism sector.

The factory tours offered by the company can be defined as an enterprise level initiative, the company is based in New Zealand, the tourism sector of the country is faced by a range of challenges this means that the factory tours being offered by OCHO are likely being faced by the same problems.  PESTEL analysis helps in explaining the external factors that are likely to affect the factory tours being offered by the company. New Zealand is geographically located away from the international mass market (Orchiston & Espiner, 2017). This clearly indicates that the company tours are not likely to be attended by international tourists. Also, statistics recorded in 2015 show that the country received about 3.1 million tourists from around the globe. However, the majority of these tourists came to interact with nature and view beautiful sceneries. No indicated number of these tourists were motivated by company tours offered by various companies in the country (Orchiston & Espiner, 2017). This is another indication that the factory tour is not likely to be receiving many international tourists.  The fact that the country is located away from international mass market and that many tourists visit the country to view beautiful sceneries pose a threat to the company tours. The fact that the country receives a lot of tourist can be an opportunity to the business.

Economic factors likely to challenge the growth of the factory tours being offered by the company are minimal since tourism is a key contributor to the nation’s economy and employment (Tsui, et al., 2018). Factory tours earn the government revenue through the tax imposed on these tours and on tourists visiting the destination. The tourism sector of New Zealand is growing at a faster rate and this increases the chances of the factory tours generating much revenue for the company thus forming another advantage and opportunity for the company. Tax levied on tours in New Zealand also pose a great threat to the business.

Social-cultural factors comprise of the belief and the shared attitudes of the people surrounding the business (Rae, 2019). Dunedin has been a chocolate city since 1869 when Richard Hudson introduced the first biscuit house. Most of the city population are employed in the chocolate factory. The Fact that the surrounding community positively influences the operations of the company forms another opportunity for the business. After the company refurbished Cadbury former premises the former employees of Cadbury were the first to be taken on a tour of the new premises. The surrounding community might also hold the belief that the company will follow in the footsteps of the former giant Cadbury enterprise, this is a threat to the operation of the factory tour business since the business is a still a small-medium enterprise.  

The chocolate factory is strategically located in New Zealand’s first Gigatown, Dunedin has advanced technology that is non-comparable on a local and global scale. Ultra-Fast Broadband is at its fastest in the city this increases the speed of innovation and better services for enterprises operating in the city (O’Brien, n.d). Technological factors surrounding the factory tour business positively influence the business and generates innovation opportunities for the business. Dunedin has been positioned to emphasize on opportunities to grow sectors of the economy. The town is taking into account the need to create an environment that fosters investment and growth in the local tourism (Yeoman, et al., 2015). Environmental factors in Dunedin gives the factory tour enterprise an opportunity to thrive.  The tourism sector has its own laws and regulations and failure to follow these laws results in ominous consequences. The factory tour must follow the rules reinforced by the local and state government concerning tourism. Strict legal law associated with tourism in the area are a threat to the factory tours.

OCHO is not the only company offering factory tours, the company has various direct and indirect competitors. Three of the company’s direct competitors include, Speight's Brewery Small-Group Guided Tour from Dunedin, Wellington Chocolate factory Tour and Pic’s Peanut Butter factory tour.  These three companies are offering company tours same as the OCHO factory tours. wellington is located in the capital of New Zealand and this gives the company a strategic advantage, the city is the second most populous city in New Zealand while Dunedin is the seventh populated city in New Zealand (Wellington Chocolate, n.d). Wellington factory tours have a greater advantage in attracting more tourists than the OCHO factory tours. Speight's Brewery Small-Group Guided Tour from Dunedin is competing with OCHO factory tour for tourists since both are in the same city the only difference is that one company is giving a brewery tour while the other company is giving a chocolate factory tour (Speight's, n.d).  The Pic’s Peanut Butter factory is located in Nelson, New Zealand which is the ninth populated city, factory tours offered by this company does not attract chocolate customers but peanut customers, therefore it does not pose much threats to the OCHO factory tours (Pic, n.d).

 OCHO factory tour indirect competitors are based in in Dunedin, these are; Larnach Castle & Garden Tours, and Taieri Gorge railway Tour. These two do not competed with OCHO factory tours on the basis of the same product but they take away the potential customers (Bhasin, 2018). It is hard for the company to tackle indirect competition since the power belongs with the consumer in this case. For OCHO factory tour to beat competition from these indirect competitors the company can only position its tours such that they appeal to the audience in a way that it surpasses the indirect competition.  

Inconclusion, OCHO moved into Cadbury former premises and launched its company tours afterwards. Following a PESTEL analysis, many external factors positively and negatively affects the business. The company tour offered by the company face direct and indirect competition from other tour offering companies.













Bhasin H., (2018). What is Indirect Competition? Retrieved from;

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Orchiston C., & Espiner S., (2017). Fast and Slow Resilience in the New Zealand tourism            industry.

Pic (n.d). Pic’s Peanut Butter factory tour, retrieved from;

Rae S., (2019). Dunedin chocolate factory wants to 'demystify' craft chocolate. Retrieved from;   

Speight's, (n.d). Speight's Brewery Small-Group Guided Tour from Dunedin. Retrieved from;   

Tsui, W. H. K., Balli, F., Tan, D. T. W., Lau, O., & Hasan, M. (2018). New Zealand business       tourism: Exploring the impact of economic policy uncertainties. Tourism Economics,          24(4), 386-417.

Wellington Chocolate (n.d). Wellington Chocolate factory Tour, retrieved from:   

Yeoman, I., Andrade, A., Leguma, E., Wolf, N., Ezra, P., Tan, R., & McMahon‐Beattie, U.          (2015). 2050: New Zealand's sustainable future. Journal of Tourism Futures, 1(2), 117-     130.











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Introduction ‘

Nokia is a Finnish based multinational telecommunication, information technology (IT) and consumer electronics company (Lesser, 2008). The company was founded in 1865. Nokia is a public company that has been listed in the New York and Helsinki stocks exchange markets.  Its headquarters are based in Espoo, Helsinki.  Nokia was listed as the 415 world largest company by fortune in 2016.  The company has been in operation for about 150 years and served a worldwide market (Nokia. n.d). Nokia is also one of the main contributors to the mobile telephony industry. The company assisted in the development of the GSM, 3G & LTE standards (Nokia,  n.d).  Nokia has ruled the market with its technology and the simple motto ‘connecting people’. Following recent developments the company was acquired by Microsoft which is one of the worlds leading software developers and since then Nokia has manufactured a number of phones that are already in the market under the windows umbrella (Saintvilus, R. 2012). This case study aims to prove that Nokia is facing serious challenges in a radically altered mobile phone market.  Nokia will be forced to radically alter operations in order to survive in the electronic market.

The troubles affecting Nokia are as a result of radical transformation in the business environment of the company. A brief examination of the Political, Economic, Social, technological and environment factors will provide a glimpse of how the company has been affected and the future of the company in the business.  Political factors are some of the factors that have contributed to the current situation of the company (Burrows,  2011). Nokia is based in a European nation and over the years the government of Finland has refused to give the company favors or bailout the company in cases of financial crisis (Kelly, n.d).  This has forced Nokia to make an uneasy alliance with Microsoft (NASDAQ:MSF).  So many tech companies such as Apple Inc one of the major competitors of Nokia has been bailed of by the government in various occasions (Mazzucato, 2013).  Unlike theses companies Nokia has lacked the support of the government, the company is based in a small European country, and this can hurt the company because it is not associated with a major super power. 

Economic factors are some of the major contributors to the situation Nokia is in now. The company has suffered badly after economic turmoil in Europe, this turmoil left Nokia wounded by limiting the company’s buying power in its home markets (Milne, 2015).  Unlike its competitor Apple which had a smooth time entering the fast growing Chinese market Nokia had a rough time tapping into this market (Doz, 2017).  Apple, Samsung and Google have a vast economic resources availed to them. Nokia lacks these resources and this puts the company in a disadvantaged position. Nokia lacks the economic capabilities to carry out research that can help the company come up with new devices that can help the company tap into new markets (Winter, 2014).  Nokia has no money that can help the company to carry out extensive research.

The widespread use of smart phones and the unique apps that come with these smart phones is a major social factor that has hurt Nokia. Some of the widely used app is WhatsApp. This app has been designed for the operating systems that are popular such as Google operating system, Android and Apple’s iOS   which puts Nokia at a disadvantaged position since, Nokia smart phones are using windows.  This has limited the appeal Nokia has on customers who prefer to use such apps thus there has been a reduced sales in Nokia phones (Roger, 2010).  Apple has gained popularity and has been associated with smart phones in major international market key player nations such as the US and this has hurt the market shares of Nokia by creating a generation of consumers who only prefer one brand over all the other brands.  In recent years Nokia has had a rough time dealing with a misconception that has gained popularity “there are only two brands of smart phones in the market, Namely; Apple and Samsung” this misconception has kept many Nokia potential Nokia costumers from considering the product.  

Technological factors affecting the company have been rooted in the social factors that limit the company.  Times have changes and consumers want to perform all kinds of task with their Smartphone’s, tasks such as; streaming videos and taking photo graphs and Nokia’s decision to utilize the less popular window as their smart phones operating system has limited costumers choice and made it difficult for Nokia to sell its product to a younger generation that wants to perform all sorts of tasks with their smart phones (Santillan, 2013).

The Legal environment surrounding Nokia is very challenging this is as a result of the company operating within the European nation (Peltonen, 2019).  The European Union has been investigating the way Google is using Android, these actions that are being taken by EU could force radical changes such as Android spinning off from Google to form a separate company. How this spin off can affect Nokia is not clear but such a situation has the opportunity to level the play ground and increase the access Nokia has in the European market.  One possible change in Google could limit the popularity it has thus giving Nokia a chance to gain popularity in the market (Hill, 2015).  Environmental factors are a challenge for every tech and electronics company and Nokia is one of them. Nokia is faced by the challenge of safely and economically disposing its waste products in a way that will be economically and environmentally friendly.  Lithium and batteries are products that Nokia need and the increased cost of these materials has been an environmental concern for the company. There is an increased cost of these products due to their usage in car manufacturing (PESTEL ANALYSIS, 2015).  Climate change that has brought about global warming is a potential threat that could disrupt the company’s transoceanic shipping and the supply chain of Nokia.

Porter’s Five Force is the best tool to be used to evaluate the microenvironment of Nokia. This took takes into consideration competitors, Customers, suppliers and new entrants (Borhanuddin, et al., 2016). Threat of new entrants; the mobile phone industry is one that is already established so new companies entering the market pose no threat to the companies in the industries since the technology needed to rival the companies in the industry need to be more advanced if the new company has any hope of differentiating itself from the other companies (Chan, et al., n.d).  Entry to this industry is not easy since there are many barriers such as the high investment that is needed for start up and marketing.  As new entrants enter the market they want large share  that are already taken by  organizations such as Nokia which holds 29% of the market, which is the highest market share as per the report given by BBC News in 2011. In conclusion, the threat of new entrants is not something that Nokia should be worried about since this threat is very low (Adamkasi, 2017)

Power of suppliers; Nokia greatly relies on its supplies to supply it with equipments for it to continue manufacturing mobile phones. The market has a large number of suppliers that Nokia could opt for, currently their software supplier is Microsoft, which has a high bargaining power over Nokia. Nokia is in a position to bargain with any mobile hardware suppliers using the argument that they control the largest market share of the industry no supplier would want to lose them. In conclusion, Nokia faces a moderate threat from power of suppliers because hardware suppliers have low power on them while their software supplier has a higher bargaining power on them. Microsoft has a lot of power on the company (Adamkasi, 2017).  Power of buyers;  the power that consumers have is on the rise since they have a lot of choices to pick from in the market, Nokia is facing competition from companies that are offering the same features that they are offering  thus the industry has become price sensitive which each customer seeking value for their money. Buyers have a lot of power because of the availability of other phones they can purchase instead of Nokia (Adamkasi, 2017).

Threats of substitute, mobile phones are essential and hard to replace although Smartphone’s perform many tasks that can be done by other devices even better such as digital cameras can take better pictures than smart phones  but the fact that mobile phones are an essential has made the threat of substitute very low (Adamkasi, 2017). Competitive rivalry;  Nokia is operating in a market where the competition is stiff, the rivals of Nokia such as apple are moving at a fast speed while it comes to making smart phones thus leaving Nokia trailing behind (Bouwman, et al., 2014).  Competitive rivalry is very high in the industry that Nokia is operating in.

VRIO frame work is a tool that is used to analyze the resources of a company and the capabilities of the company, this tool helps in discovering the competitive advantages and the weaknesses of a company. The VRIO is a framework of four set questions of value, rarity, imitability and organization (Lin,et al., 2012).  Quality, price, service and brand image are the competence that can be choose from Nokia.  The fact that Nokia offers high quality services makes it possible for the company to take advantage of environmental opportunities that helps the company neutralize environmental threats. Quality is an organizational strength for the company (Ciesielska, 2018). The prices of Nokia phones in some countries are relatively low and this gives the company a competitive advantage.  Nokia resources are rare to imitate. Nokia as a brand is the world’s fifth valuable brand which gives the company a competitive advantage (Lartey, 2008).

Opportunities and threats are factors influencing the business externally.  Nokia has the chance to make the Microsoft Nokia acquisition a win -win situation and the acquisition can still work in their favor if both utilize resources at their display in a better way (Pai, 2015).   Nokia is in a position to utilize the news consumer trends to open up new markets. The new consumer trends also give the company an opportunity to diversify into other products.  With the implementation of new taxation policies comes new opportunities for Nokia, Nokia is already an established player in the market and these tax policy give the company a chance to increase its profitability. With opportunities come threats, the major threat facing the company is stiff competition from other established key players in the international market (Bhutto, 2005). 

For Nokia to sustain and maintain its success and improve continuously there are main options for growth that have been guided by the Ansoff matrix. Marketing penetration; which is done using the company’s existing products in the existing market. Market penetration is the riskiest way of growing a business (Loredana, 2016).  Nokia should do a few things such as making sure that their pricing strategy are reasonable, introduce discounting offers to their clients, bring new marketing campaigns or improve the existing ones, carry out research and sell to a different market in case the already existing market is saturated. Lastly, lower the current prices of their products so that they can appeal to most of their customers.  For product development, a product in the market can be altered a little so that it can target a different customer segment. In the diversification part the company can develop a technology or something completely new as a way of trying to gain more customers (Lubinaite, 2015).  The last quarter of 2018 saw Nokia end the year well (Revuz, 2012).  The second quarter of the same year saw an improved profitability in the technologies of Nokia. The net sales of the company had increased by three percent compared to the former year 2017. The sales rose from EUR 6.7bn to EUR 6.9bn. 2018 saw an increase in the sales and profits of the company (Nokia, 2019).

Nokia is in a very competitive field, the fact that the company registered an increase in profits last year does not mean the company will continue making profits. Nokia has to strategize on the future if it is to stay ahead of competition.  Nokia 5G IOT is the future for Nokia. This is a game changer for Nokia, which is in collaboration with nine more companies.  Nokia 5G IOT will be the first of its kind, Nokia is behind the development of a technology that will deliver the extra ordinary (Nokia n.d). Nokia 5G IOT will connect everything, everywhere efficiently and quickly and bring about new services. Competition is one of the challenges facing the company in phase one, therefore the introduction of 5G IOT will help deal with the competition. In phase two with reference to the ansoff matrix the company can diversify by creating a completely new product. Development of 5G IOT is a new product for the company and in order to make sure the profits do not fall the company has to find a way to attract new customers and the only way it can do so is by bring a new product that will attract more customers.  The 5G IOT is development is underway following research that has been conducted by Nokia it can be sustained.


Nokia is a company that has been in operation for over 150 years it is based in Finland, Europe.  The company has faced some serious political, economic, social, technological and legal challenges.  In the industry the company is not threatened by the entrance of new companies though it is threatened by the power their software, supplier Microsoft has, threatened by competitive rivalry and threatened by the power of the buyer. The last quarter of 2018 saw the company register increased profits. The ansoff matrix has proposed ways that can be implemented by Nokia for it to boost its sales. For Nokia to have a hold on the future it should invest in 5G IOT in order to deal with competition and make sure it controls a larger share of the market.
















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Hyundai Heavy Industries Co., Ltd.



HHI is among the largest shipbuilding company in the world. Its headquarters are in Ulsan, South Korea. Chung Ju-Yang founded the company in 1972 to serve as one of the divisions of the Hyundai Group. It managed to finish building its first ship in 1974 and in 2002 it spun off from Hyundai group. Currently HHI deals with; ships building, offshore and engineering, industrial plant & engineering and Engine & machinery. Ship building industry involves the operations carried out during construction of ships and any other vessel that floats on water, ship building operations take place in a specialized facility referred to as a shipyard.  The roots of ship building history can be traced back to ancient times even before history begun to be recorded. Over time ship building is an industry that has suffered from the global rules absence and has also been used by countries such as Japan to rebuild their industrial structures. South Korea which is the mother country to HHI made the shipbuilding industry an important key player of the economy of the country. The strategies put in place by HHI has helped the company emerge and remain at the top of the industry for a long time.

In 2017 the shipbuilding industry GDP increased with a growth rate of 3.7% which was its highest increase since 2011. According to research conducted by OECD the GDP of the industry will continue to gain further strengths in 2018 & 2019 if the growth rate will be 3.9% annually. In 2017 it was predicted by UNCTAD that the worlds seaborne trade would rise by 2.8%. However, an upswing in shipping demand may not bring about a rise in the number of new ships constructed and vice versa (Steidl, Daniel, & Yildiran, 2018). The shipbuilding industry is an industry that has to undergo a process from growth to recession. The life cycle stages of the shipbuilding industry are divided into four stages. The first stage is the initial stage, the growth stage, mature stage and decline stage. These life cycles constitute of important external environment of enterprise, economics and management that has made scholars interested in studying the theory of life cycle of the shipbuilding industry (Xinhua, & Yujing, 2014).  

Porters Five Forces model can be described as a simple but powerful tool to understanding the competitiveness environment.  Scholars have presented many tools to analyze the competitive environment of an industry, these tools are game plan, Value Chain Model and PESTEL but in this case it is more preferable to use the Porters five force model, the competitive forces are the threat posed by new firms entering the industry, the power that has been allocated to the buyers, the power that suppliers hold, the market threat that is posed by substitutes. Lastly, the existing rivalry between the companies already existing in the market. These forces are responsible for determining the average level of expected profitability in the industry. The strengths if these forces are inversely proportional to the process and profits to the extent that a weak competitive force is taken as an opportunity and while a string one is interpreted as a threat (Sung, Samuel, Mahasuwan, Pupipat, & Shanna, 2009).

For many years Korean shipbuilders have been on the lead when it comes to shipbuilding. They have offered cost effective, high quality vessels and now China is advancing and closing the gap that exist between them and Korea, their business rival. Globally, the ship building industry is geographically divided. The industry is concentrated and the majority of the market shares are taken by China, Korea and Japan.  Rivalry in the shipbuilding industry has existed for a long time in the industry, competition as a result of the rivalry has created an environment that is not disciplined. The firms in this industry are not similar in their dealings and their profits differ due to geographical locations that have different economic conditions. The product differentiation is low thus bringing about high competition. The high investments made while entering the industry make it hard for firms to leave the industry (Sung, Samuel, Mahasuwan, Pupipat, & Shanna, 2009).

HHI has 10 drydock, and a construction facility that are equipped with up to date technologies. With this infrastructure. Each of the drydock is designed to build certain ships The Gunsan drydock can managed to build about 20 ships per year and its equipped with the latest advanced technology. These resources are the core strengths of HHI. HHI has the largest number of drydocks compared to other shipbuilding companies, and its involved in building different ships (Hyun, 2015).

 The human resource system of the company is well developed and designed. In order to develop their employees, they take them through certain programs. HHI has top strategic management course, business course that are undertaken in the top business schools (Hyun, 2015). The company also runs a learning institution, Hyundai Technical Education Institute (HTEI) that was established a few years after it finished building its first ship in order to educate and make their employees more knowledgeable in the various fields of shipbuilding but their competitors have also established their own schools that run different programs that suit the companies. Despite the many advantages the company’s distance from capital is a major problem for the company, in Korea the location of a firm is one of the strongest motivating factors. Closeness to the capital will help in recruiting and maintaining human resource since most of the productive population desire to work and live in the capital, their competitors such as SHI have managed to be located near the major capitals of the country (Hyundai Heavy Industries, 2015).  HHI is also using high level technology in production in order to make their ships more environmentally friendly


HHI is among the largest companies in the ship building industry. The shipbuilding industry undergoes a process of growth and recession. The lifecycle of the shipbuilding industry is divided into four stages. The shipbuilding industry is analyzed according to geographical location instead of the number of firms. The Korean shipbuilding industry has managed to be on the lead for many years but their Chinese rival are closing in on that gap.  The competition in the industry is high and it has created an environment that is not disciplined. The firms in the industry are diverse and thus different firms can accept low profits. Exiting the industry is had due to the barriers placed by the high investment made. HHI has the highest number of drydocks compared to their competitors. The human resource of the company is well developed, the company is also using advanced technology in order to enhance efficiency and environmental friendliness. The strategies being used by HHI have helped the company emerge at the top of the shipbuilding industry.












Hyun, L., (2015). Strategies for Improving the Competitive of the Korean Shipbuilding Industry: Case Study of Hyundai Heavy Industries. Retrieved from;                         

Hyundai Heavy Industries. (2015b, August 17). 2015 Half Term Report (Report). Retrieved from   

Steidl, C., Daniel, L., & Yildiran, C., (2018). Shipbuilding Market Development. Retrieved          from;

Sung, N, A., Samuel, N, Mahasuwan, P, Pupipat, P., & Shanna, Z., (2009). Competition in the     Shipbuilding Industry. Retrieved from;   

Xinhua, Q., & Yujing, H., (2014). Analysis of the Life Cycle of China Shipbuilding Industry.






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            Project stakeholders are organizations, individuals, or group of persons, that has the potential of affecting, or be affected by the activities, decisions, or outcomes of a project. In most cases, they are directly engaged or have various interests which might be impacted negatively or positively by the outcomes of the project (Lester, 2006). 


            A project sponsor is basically an individual or group of individuals who provides resources as well as supporting the realization of the goals of the entire project. These individuals can either be internal or external to the enterprise (Binder & Ebrary, 2007). 


Leadership – In the project management industry, leadership is perceived to the modern buzzword which aid in directing the others as well as delivering the project in time.

Team management- other than leading the project team from the strategic point of view, it is vital to manage them from an operational perspective. It is this skill that will enable them to excel in coordinating project team through delegation of duties, goal setting, promoting work, evaluating performance, and resolving conflicts (Kerzner, 2009). 

Negotiations – for the project manager, proper communication will have to take into consideration negotiating the utilization of resources, project scope creep, schedules, budgets, as well as other issues that are ultimately unavoidable.

Communication – the project managers should have the potential of using his or her communication skills to enables the project team to understand the goals to be met. Likewise, he or she should ensure that the project stakeholders have understood how the project deliverables are to be met (Harrison & Lock, 2004). 


  1. Sponsors – whether internal or external, to the project, sponsors takes the responsibility of supplying resources which in return enables the realization of the project goals.
  2. Customer and users – These individuals take the responsibility of approving and managing the product and the services they offer to them. As the name suggests, users are individuals or organization that uses such a product (Westland, 2006). 
  3. Sellers – these are external organization or individuals who enter into the contractual agreement aimed at facilitating the supply of resources required by the project.
  4. Business partners – this are basically external business organizations who partners with the project management authority for the purpose of supporting, advising, and solving problems that might arise (McGhee & McAliney, P2007). 


            During the project lifecycle, proper communication is perceived to be the crux of relationship establishment. Therefore, the effective communication by the project manager is a key to improving the execution of each task. Therefore, the project manager will have to engage with workers, stakeholders, sponsors, customers, and the project owner (Pratt, 2010). 


            One of the most important information that ought to be shared between the project management team and the stakeholders is the purpose, drivers, and the goals of the scheme. As much as project management is concerned, it is obvious that stakeholders always desire to see a clear picture of the entire scheme. It is therefore important to let the stakeholders informed about all that will transpire during the project lifecycle (Newton, 2007). 


            One of the means that can be used will entail having a concise communication plan. This is to imply that in the process of developing an effective communication plan, it becomes easier for the stakeholders to understand how and when each task will start and its completion time. On the other hand, it will be possible for them to understand the amount of resources (project drivers) required, as well as the means to be used to achieve its goals (Pratt, 2010). 

            Another mechanism is the continued sharing of information at each phase of the project. This is to imply that in the process of providing details concerning what encouraged the project, it will enable the project manager to ensure that the stakeholders have understood the significance of such a project. Likewise, awareness creation is also a better strategy for creating a better connection between the project’s outcomes or goals (Lock, 2007). 


            Communication is regarded as being a vehicle for enhancing the success of the phases of the entire project. As a result of that, the project manager should ensure that he or she has shared information with stakeholders at every phase of the project. Equally, whenever changes or issues arise as the project continues, the project management team should inform the stakeholders and the employees the steps to be taken.


            As much as project management is concerned, unsuccessful communication is one of the contributors of its failure. As a result of that, it results to negative consequences to the success of the project at least half the time. Therefore, to counter the effect of this, it is paramount for the project team manager to take the responsibility of ensuring that they have practiced active listening, maintained a manageable project teams, utilize more and more interactive communication, and have regular project meetings.


            Texting or short message services (SMS). The reason for selecting this type of technology is because the selection of a particular project communication technology is one of the critical decisions which ought to be driven by the requirements of the entire scheme or project.  The reason for that is because it is the one that can aid in facilitating efficient execution duties through assuring accurate and timely communication amongst project teams.


            There are a number of ethical issues that can be violated during the launching and execution of duties of such a project. In most cases, the magnitude of such a scheme is what determines the number of opportunities available for individuals to compromise the ethics with the objective of bringing the project in on budget and in time. Thus, when project management authority and stakeholders end up turning a blind eye to some questionable activities, communication becomes a legal or ethical issue.


            One of the proven means for managing project risks during its execution involves the use of risk planning. This strategy is important because it assists in identifying potential problems which might trouble the project. The same mechanism can be used for the purpose of facilitating analyzing how such risks are likely to occur, the action/s to be taken to prevent them, and so on.  On the other hand, to take the advantage of the opportunities acknowledged, it is crucial for the project management team to enhance effective communication, increase the efficiency of accomplishing tasks as scheduled, and effective facilitation (McGhee & McAliney, P2007). 


            Since risks are always born as the project starts to the end, it is vital for the project management authority to ensure that they have been updated at each phase of the project. It is important to come up with a risk assessment plan, which will aid in analyzing any risks that might evolve later as the project continues (Russell, 2007).          


            Once the scheme is completed, one of the opportunities created is the need of reviewing project documents so as to ensure that they are up-to-date. Likewise, the project information that the project manager will be gathering during this phase will assist in reflecting the final product’s characteristics and the specifications.  After the ascertaining that documentation of the project outcomes has been done, it becomes possible to seek customers or stakeholders’ formal acceptance (Westland, 2006). 


            Once the project has been accomplished, one of its potential financial impacts will entail determining whether the project was delivered on budget. Ideally, stakeholders always desire that such a project is accomplished on a timely basis so as to avoid making loses (Kerzner, 2009). 


            Once the scheme is completed, there are various things that are anticipated to be accomplished. One of them is the accomplishment of all the tasks on a timely basis and on budget. Another one is the improvement of the product quality which in return makes the stakeholders to feel contented that their funds were wisely invested (Lock, 2007).           


            Organizational results are perceived to be outcomes arising from operational and project processes. Therefore, in case the project is managed properly, it increases the chances of improving the quality of the final product; enhance the strategies used in lowering expenses, as well as increase stakeholders contentment about the project (Binder & Ebrary, 2007). 


            When a product is finished as required, it means that it have the ability of meeting the desires of the final consumers as well as the stakeholders’ expectation. On the contrary, in case the final product is of low quality, it means that stakeholders will not be contented with the capabilities of the project manager. The customers will also not approve using the products of such an organization. In return, such a scenario will deny the organization the chances of receiving other projects (Lester, 2006). 










Binder, J., & Ebrary, Inc. (2007). Global project management: Communication, collaboration and management across borders. Aldershot, England: Gower.

Harrison, F. L., & Lock, D. (2004). Advanced project management: A structured approach. Aldershot, England: Gower.

Kerzner, H. (2009). Project management: A systems approach to planning, scheduling, and controlling. Hoboken, N.J: John Wiley & Sons.

Lester, A. (2006). Project management, planning and control. Oxford : Butterworth-Heinemann

Lock, D. (2007). The essentials of project management. Burlington, VT: Ashgate Pub.

McGhee, P., & McAliney, P. (2007). Painless project management: A step-by-step guide for planning, executing, and managing projects. Hoboken, N.J: John Wiley & Sons.

Newton, R. (2007). Project management, step by step: How to plan and manage a highly successful project. Harlow: Pearson Prentice Hall Business.

Pratt, D. (2010). Pragmatic Project Management: Five Scalable Steps to Success. Oakland: Berrett-Koehler Publishers, Incorporated.

Russell, L. (2007). 10 steps to successful project management. Alexandria, Va: American Society for Training and Development.

Westland, J. (2006). The project management life cycle: A complete step-by-step methodology for initiating, planning, executing & closing a project successfully. London: Kogan Page.




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Marketing plan


Gymshark has had great success in the sportswear department especially with its direct approach of not only approaching customers, but also making its products and services available with great ease.  The lack of brick and mortar premises has pushed the company towards improving the process between purchase and delivery.  The improvement in service delivery, combined with the quality of service and products offered have made the Gymshark a dominant player in the sportswear industry.  With growing trends in technology and consumers constant need for convenience, Gymshark is likely to benefit from trends such as the growing popularity for e-commerce.  The company is likely to find it easier to reach its customers, market its products and services, and increase its reach.  However, despite the growing popularity for e-commerce and a flexible business culture, Gymshark needs to establish brick and mortar stores in order to attract clients who are yet to catch up with recent trends or those that opt to stick to traditional forms of business.

While Gymshark has a large market share in the regions it operates in,  whatever profits made are in no way a reflection of the company's potential for growth or dominance in the market because it is yet to satisfy a market niche that most of its competitors have already ventured into.  While its strategy has proved successful over the year, Gymshark's decision to refrain from brick n mortar premises means that it has closed out potential customers that prefer to shop in business premises rather than online.  This combined with the ease in selling products and services through e-commerce have made it challenging for Gymshark to compete with other companies in the market it operates in especially with their physical and online presence.  It is therefore recommended that the company considers investing in brick and mortar premises so as to increase the number of customers seeking out its products and services.

One major reason why Gymshark should start its own brick and mortar premises lies in the potential to build the company brand.  Despite the loyal following demonstrated by Gymshark customers, most of their loyalty is to the products and not the company itself.  This is especially because customers have had the chance to experience and use the products but are yet to associate them with a tangible company (Kuczwara, 2017).  Even with a well-established name, the company's identity greatly lies on the company brand as it is often what new customers consider when purchasing products. There is also the issue where customer tastes and preferences keep changing.  Since the customer loyalty is to the products, the company is constantly at risk of losing customers if they are dissatisfied with a product or they get better products from the competitors (Kuczwara, 2017).  If the company establishes brick and mortar premises,  it will be able to create a physical identity as well as corporate image whose brand is associated with all the products and services provided by Gymshark.  Customers will be able to associate the products with a physical business, and therefore owe their loyalty to both the company and its products.

Brick and mortar premises are also advantageous in that they trigger impulse buying from customers.  When buyers shop through e-commerce, their purchases are mostly limited to the products they sought out to buy.  This is especially because of the added features in online shopping that allow customers to filter out other products that bear no relevance to the item they wish to purchase (Adler, 2014).  Although there are advertisements to entice customers into buying more, the likelihood of it happening is relatively low especially because of the extensive research that customers do before making online purchases.  In the case of brick and mortar premises however, customers have to look through a variety of other products while seeking out the product they wish to buy.  Walking through a physical shop offers more variety than an online one because customers cannot filter through all other products (Adler, 2014).  When customers see other products, they are more likely to engage in impulse buying and in this could greatly boost sales for the company. Impulse buying is also encouraged when the company displays luxurious products on its shelves.  Customers are likely to associate the luxurious products with quality and specialty which is likely to create customer loyalty as well as increase the chance of repeat buying.


The PESTEL analysis can help the company to better identify the market it seeks to exploit as well as come up with the best approach when starting the brick and mortar premises. 


At present, the success of the company is limited by politics governing countries that the company operates in especially in relation to online interactions.  The lack of physical shops means that customers have to use services like e-commerce when making purchases.  However, in countries like China where access to the internet is controlled by the government, Gymshark may find it difficult to reach customers in such regions due to the red tape around internet use (Qing, 2010).  If physical premises were introduced, it would help the company to overcome the political barrier and penetrate markets it was unable to in the past.


The state of the economy greatly influences people's spending power.  Since Gymshark deals in sportswear, customers buy more from convenience than necessity (Qing, 2010).  The economy can therefore determine the sales made and the company should try and market its products as being affordable so as to attract customers even when the economy is low.


Customer purchase decision is greatly influenced by trends and opinions in society. The socio factors therefore determine the reception that specific products get in the market and Gymshark should strive to create a positive image so as to attract customers seeking out high quality products (Qing, 2010). Understanding the social factors that govern society can also help the company to anticipate the target customers’ needs and offer products designed to meet them


            Lack of physical business premises requires lot of online transactions as this is the best way to ensure that products make their way from the manufacturers to the customers. Technology is therefore a crucial element in the delivery of service between Gymshark and its customers (Qing, 2010). With advancements in technology, the company should ensure that it has state of the art equipment and that customers get the best access to products and any relevant information needed in helping them to make the purchase decision. Technological trends are therefore likely to influence the business decision and the company needs to be updated on the changes in the industry as well as changes in customer tastes and preferences.


Another factor that the company needs to consider is the impact that doing business will have on the environment it operates in and what can be done to improve it. With recent trends focusing on global warming and the need to preserve the environment, the brick and mortar premises that the company could build should factor in the impact that the business will have and how it be received by the target customers (Qing, 2010). Projects like cleaning up the environment, helping the needy and giving to charity are likely to have a positive impact and could help build lasting relationships with the customers.


            Gymshark also needs to abide to the laws and regulations that govern the regions it seeks to operate in not only through the web, but also through the brick and mortar premises it could start. The business should abide to laws regarding marketing approaches, how to treat employees and also salaries and wages, to mention a few (Qing, 2010). Observing laws and regulations will ensure that the company avoids lawsuits and that its operations are not constantly halted by government interference.

Porters Five Forces Model

            Gymshark can also use Porter’s five forces model to better understand its environment, the competition and how to achieve success in its chosen market. The company should try and control supplier power by having more than one supplier who can provide services and raw materials (CGMA, 2013). A variety of suppliers prevents them from controlling pricing as there is a variety to choose from, all of which try to attract manufacturers with their low prices and quality of service. Since the aim is to start brick and mortar premises, the suppliers will play a major role in ensuring that the products make it to the premises in good time. Another force that the company must keep in check is the buyer power (CGMA, 2013). Since customers always seek the lowest prices, controlling the buyer power will ensure that products are sold at relevant prices that do not overcharge the customers but still offer quality products and services. One way to achieve this is by attracting more customers to create more demand and this can be achieved through the brick and mortar premises as they will attract new customers.

            The company also needs to deal with competition rivalry. Gymshark’s dominance in the markets it operates in is greatly challenged by the existence of competitors. The competition poses more risks especially because most of the competitors have brick and mortar premises, and therefore a physical presence. In order to maintain its competitive edge, Gymshark must find ways to beat the competition and one way to achieve this is through the brick and mortar premises as they are likely to bring in more customers as well as assert the company’s physical presence in the markets it operates in (CGMA, 2013). The company must also deal with the threat of new entry as this will greatly reduce the level of competition. With growing trends for healthier lifestyles, more businesses are likely to come up offering sportswear for customers seeking to exercise and stay in good shape. Limiting new entrants will not only reduce competition but also increase the number of potential customers that the company could serve (CGMA, 2013). The company also needs to address the threat of substitution by ensuring that the products and services it offers are of the highest quality. Offering the best quality at affordable prices will give customers value for their money and discourage them from seeking out different products elsewhere.

SWOT analysis

Other than understanding the market it operates in Gymshark also needs to understand its position in the market and how best to exploit the opportunities present and overcome the challenges and this can be achieved through a SWOT analysis of the company. One of the company’s major strength is its strong online presence. Despite the lack of physical premises, Gymshark has established a strong following on the web and a significant number of people know its brand and choose its products over others in the market. The strong relationships that the company has with its customers are also strength for Gymshark. The customer loyalty ensures that there is constant demand for the products and services and this gives the company a competitive edge.

            The major weakness that Gymshark has is the lack of brick and mortar premises. While the decision to operate through e-commerce does make the company more flexible, it locks out potential; customers who prefer physical shopping than doing it online. The lack of physical premises is a weakness in that; it locks out potential customers who would otherwise increase sales for the company. The company however has opportunities that it could use to its advantage such as the various technological advancements. The introduction of e-commerce and its growing popularity has made it easier for Gymshark to access customers and make its products available. Another opportunity is the current trend that has created demand for healthier lifestyles. People seeking out sportswear with the aim of keeping fit are likely to increase the demand for athletic equipment and Gymshark is likely to benefit from the increase in demand for such products. The company must however overcome its major threat which is competition. With various recognized companies offering similar products in the sports industry, Gymshark must constantly upgrade its services and products in order to maintain a competitive edge.

Marketing objectives

In order to grow and increase its market share, Gymshark needs to set clear and precise objectives to help attract more customers and increase sales.  One of the main objectives is to establish brick and mortar premises that aim to serve customers who are not used to shopping online. Another objective is to build the company domain such that Gymshark is ranked among the top organizations for searches related to sportswear on the web. Lastly, the company will also strive to improve engagement with customers through promotions conducted online and in the brick and mortar premises owned by the company.

Marketing strategy

            The marketing strategy will employ the use of the segmentation, targeting and positioning model when selecting the market to set up brick and mortar premises.

  • Market segmentation

The segmentation will involve dividing the market into different segments in order to identify which areas to exploit.  It will consider factors such as demographics which relate to the customer’s income, age, gender and education to mention a few. Psychographics will be another factor used to help the company understand what pushes customers to make purchases (Hanlon, 2018). Understanding people’s behaviors, hobbies and lifestyles will be helpful when determining what products to offer to the target customers. Lifestyles are also a factor as the company must identify what lifestyles create demand for sporting goods and how best to exploit them. Hobbies and recreational activities for example will help determine the type of products to sell in order to attract people who engage in the relative sporting activities in the form of hobbies.

  • Targeting

After dividing the market into different segments, the next step is to identify which segment is the best to set up physical premises in. Segments that offer the most opportunities for the company to make profits as well as have the best potential for growth should be prioritized as they hold the best opportunities for the company (Hanlon, 2018). The segments should also be large enough to allow for growth and also to ensure that the company can still benefit even when competition intensifies.

  • Positioning

Lastly, the company must position itself in the market targeted by coming up with the best approach to enter the market and assert its dominance. To achieve this, the company can rely on a well laid out and implemented marketing mix.

The company should ensure that the products it sells are of the highest quality and that they give customers value for their money. Other than the product, the company can also share information regarding the products and services through emails, social media and direct marketing. In relation to price, setting prices that are relatively low and give value for money will encourage customers to choose Gymshark products over others in the market (Martin, 2014). The prices can also be used to convince customers of the quality of the products sold especially in the case of luxurious products. Since the goal is to set up physical premises, the place should be selected with emphasis on offering convenience. The shops stores should be set up in areas that are easily accessible, have enough traffic and secure enough to put customers at ease while shopping. An online presence should also be created for the brick and mortar stores to ensure that customers have all the avenues to conduct research before going to the actual shops (Richter, 2012). Lastly, the company should use different forms of advertising to promote its new premises and the products sold there. Online advertisements, television ads and magazine publications can greatly help in notifying potential customers about the new stores and the products and services there as well as any relevant information that will push sales.


Gymshark has been quite successful in the market especially due to the online presence it commands. However, in order to grow and increase sales, there is need to attract new customers and this can be achieved through Brick and mortar premises. This is especially because the lack of physical premises locks out potential customers who do not, or opt not to make purchases online. The company should therefore invest in market research aimed at identifying potential locations for brick and mortar premises so as to attract new customers.











Adler E, (2015) “Brick and Mortar retailers have one big advantage over ecommerce companies”             Business Insider, retrieved from,       retailers-have-one-big-advantage-over-e-commerce-companies-2014-7?IR=T

CGMA, (2013) “Porters five forces of competitive position analysis” retrieved from,   

Hanlon A, (2018) “The segmentation, targeting and positioning model” Smart Insights, retrieved             from,            targeting/segmentation-targeting-and-positioning/

Kuczwara D, (2017) “Brick and Mortar vs ecommerce stores: How to leverage the best of both” retrieved from,  stores/

Martin, (2014) “Understanding the marketing mix concept: 4p’s” retrieved from,   

Richter, T. (2012). International marketing mix management: Theoretical framework,      contingency factors and empirical findings from world-markets. Berlin: Logos.



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Company description



            OhioHealth is a reputable non-profitable and a tax exempted system of hospitals that are located in Columbus, Ohio and the areas and the surrounding areas. This system of non-profitable healthcare consists of 11 hospitals and above 200 ambulance services, they offer services such as; in patient, out patient and home care. Their services are available in 47 Ohio counties. Its origin dates back to 1891. It was named as one of the best healthcare systems in America for three consecutive years. It also offers treatment such as; cancer treatment, heart and vascular treatment, maternity and women’s health, trauma services, stroke treatment and sport medicine among many others. The hospital is under the United Methodist church, it is at the district level. The hospitals are guided by policies that are well laid out; these policies have been their guide to success. Its contribution to society cannot be disputed, since the time it was founded its work has helped increase medical care in America and achieved its goal of delivering quality healthcare to the community.  

Its origin can be traced to 1891, it was under the protestant hospital and the only hospital that was not under the Roman Catholic Church. It became the fourth hospital in Columbus. In 1992, the OhioHealth hospital became a white cross hospital after the Ohio Methodist Episcopal Conference. Due to financial constrains only the United Methodist church was able to support it. Despite this factor the hospital grew at a quick pace and in 1958, it was breaking grounds at the West North Broadway and Olentangy River Road and due to its location, the new hospital branch was named, Riverside Methodist. In the 1980s, they had started expanding to new fields of medicine (OhioHealth, n.d). OhioHealth members include; Shelby Hospital, O’Bleness Hospital, Doctors Hospitals, Grant Medical Hospital, Riverside Methodist Hospital, Grady Memorial Hospital, Hardin Memorial Hospital, Marion General Hospital, Mansfield Hospital and Dublin Methodist Hospital and Rehabilitation Hospital. In 2018 the system of OhioHealth had 29,000 physicians and volunteers the hospitals also reported a net revenue of $3.5 billion (OhioHealth, n.d)

OhioHealth has been known to bring together expertise and innovation to offer the best services. Among the services they offer is treatment of heart related diseases according to the patients needs. They offer highly recognized cardiologists who offer their expertise in treating and rehabilitating cardiovascular patients. They also have a system in place that notifies their emergency team of an incoming heart attack patient, therefore they are able to offer emergency treatment quickly without any inconveniences. Their cardiologists are also committed in helping their patient take steps that would prevent them from heart diseases. They have programs in place that help the patients stay safe and health and this programs also help reverse a condition that threatens the heart. They also offer cardiac rehabilitation which is an important step towards returning to a heart disease free life, they have a team of experts in place to design rehabilitation program for patient recovering from various heart- vascular diseases’ (OhioHealth, n.d). Lastly, they offer a weight management program to their patients to help control the risk of getting a heart related disease.

Hospital under this system are certified members of the MD Anderson Cancer Network. They have access to internationally recognized cancer protocols. Over the years they have been know to offer the best cancer treatments. They are successfully in managing the care their patients require, they support the need of their cancer patients and help them overcome the challenge they face as a result of living with cancer. They also offer cancer support groups where patients meet and discuss their experiences living with cancer, in these support groups they also offer counseling to their patients. They also provide wellness programs to cater for the need of these patients (OhioHealth, n.d). They are also at the top while it comes to offering integrated cancer care programs, their physicians focus on more that healing the cancer by using this program they offer services such as massage. Lastly, they also help the patients manage the pain, nausea and fatigue that is brought about by cancer.

OhioHealth believes in offering Neuroscience care that is beyond the medical treatment they offer, the collaborative system they offer helps their brain related patients participate in healing their bodies, and spirits as they undergo brain or spine treatment. They have in place over 30 locations that offer neuroscience care throughout the 47 counties that they deliver their healthcare. These facilities offering neuroscience care offer services such as; acute in-patient care, rehabilitation and wellness programs for their patient. The Riverside Methodist Hospital that is under the OhioHealth was ranked by the U.S. and World Report as one of the 2018-2019 best hospital for neurology and neurosurgery (OhioHealth, n.d). They also have nationally and internationally renowned neuroscience experts who offer treatment routines that treat complex neurological conditions.

OhioHealth offers palliative medical care to their patients who are recovering or suffering from diseases such as; cancer, kidney failure, Alzheimer, and multiple Sclerosis. They have a team that helps patient get through these serious conditions. Their programs of Palliative care include; helping their patients prevent new complications that are brought about by their existing condition. They also encourage their patients towards a meaningful experience that include personal and spiritual growth. On top of the care and special services that they deliver they have trained professionals that help people with difficulties of overcoming grief (OhioHealth, n.d). They help these people who are overcome by grief by offering services such as; support groups for all ages, private counseling and expertise art therapy.

OhioHealth in partnership with NovaCare Rehabilitation, offers a national wide recognized outpatient physical rehabilitation services. Their rehabilitation programs include; Comprehensive therapy sessions, and specialized treatment. They also make sure that their services do not inconvenience their patients. Their well know rehabilitation programs are Cancer rehabilitation, cardiac rehabilitation and neurological rehabilitation (OhioHealth, n.d). They also offer imaging and radiology using the most advanced equipment that deliver accurate results. Lastly, they offer national wide recognized orthopedic program that consist of advanced treatment for all kind of bones. Their treatment ranges from joints conditions to the simplest conditions (OhioHealth, n.d). Their treatment programs are extensive and are offered for almost all the diseases.

This system of hospitals has rules and policies that are laid down, these rules and policies are responsible for ensuring that it runs effectively. Their core values include compassion, excellence, integrity and stewardship. Their core mission is to improve the health of those they serve. They also have a code of conduct that is applicable to all the people that work under this system of hospitals. The main role of this code of conduct is to provide guidance and failure to follow the rules results to dire consequences. Some of the rules contained in their code of conduct include; all members are entitled to report any activity which they believe is not in compliance with the pertinent laws (OhioHealth, n.d).

They have policies that ensure the safety of their patient, these policies include; asking for patients consent before putting them through treatment, according each patient with respect by maintain confidentiality and privacy, patients are treated in a manner that preserves their dignity, patients are not to be treated before their medical history is analyzed critically and during emergency cases patient should be treated regardless of their ability to pay. Policies that govern the relationship between the interaction of patients are also laid down. They have also implemented policies that facilitate accurate billing to government tax payers, patients and commercial insurance payers. Policies regarding codding and billing include; bills and claims should only be submitted when services are rendered, Bills and claims should contain accurate diagnosis, medical documents must provide reliable information of the services rendered and accurate and timely and accurate documentation (OhioHealth, n.d).

They also have policies under the name of HIPAA privacy and security regulations. That gives their patients more control on who accesses their healthcare information. These policies require that all those who work for or on behalf of OhioHealth are required to obey this policy by; not leaving patients information on computer screens, not leaving their charts with patients open, printed materials with printed data on patients should be shredded after they are used, patient related discussions should be avoided in public areas, materials with information about a patient should not be stores on an electronic device or left in a car overnight, any theft of loss of patients document should be reported to the department director and casual discussions relating to a patients should be avoided (OhioHealth, n.d).  

Policies that monitor the use of electronic media of the company are in place. These policies include; the properties of the of OhioHealth are only to be used for business purpose in accordance with internal policies and procedures, the systems of the company will not ensure safety of personal resources, electronic devices of the company may not be used to send, post, store or download or distribute any threatening materials. Any employee of the company who abuses the use of electronic devices of communication or uses them extensively for purposes that are not related to business will face disciplinary action and denied these privileges (OhioHealth, n.d). There are also policies that guide the business courtesy, these policies include; all employees conducting business on behalf of OhioHealth are expected to conduct themselves with the highest degree of integrity and the company does not accept gifts that are not related to any activity of the company, gifts of these king should be returned and the company policy on gifts explained to the party (OhioHealth, n.d).

            Policies to promote diversity and equal employment opportunities are in place to ensure achieve their goal which is to actively promote diversity in their workforce. These policies include; it is the responsibility of every worker to support and comply with this policy and no one shall discriminate his/her fellow workers on the basis of sex, nationality, race, age or ancestry. There are other policies that state it is the responsibility of each OhioHealth worker to preserve the assets that include; time, supplies and equipment’s of the company (OhioHealth, n.d). This and many more policies are laid down to ensure that the business meets its goals.

            The culture of the business is characterized by their mission and the value they place on excellent results, integrity and stewardship. The company is also a culturally diverse and a unique work place.  The workers working for the company work as a group and share common values. The working atmosphere provides these workers with an atmosphere that challenges their growth and also reward them. The employees work as a group to fulfill their mission.  They celebrate the individuals and groups that make them stand as one of the top caregivers. Success is an everyday achievement in the company because be the aim of succeeding is in the heart of every employee (OhioHealth, n.d). They also make a difference in the lives of those they offer their healthcare to.

The company strives to attain good leadership, by training their leaders to be truly listening, everyone’s voice is heard and this motivates the workers to ask questions, they also strive to ensure a collaborative environment. They engage in OhioHealth Leadership Briefing that enable their leaders to share developments taking place in their organization. It is also an organization defined by transparency and moving forward. Healthcare is an evolving field and they are always in the forefront to help this field change through transformative programs like CareConnect and electronic medical records. They provide their workers with benefiting programs that ensure their lives are fulfilling this can be reflected by the flexible timetables they offer their employees (OhioHealth, n.d). Among their top goals is to show how much the community means to them by giving back to them through programs such as, the Heart Walk and CapCity Marathon.

The most essential determinants of whether a company is a great place to work is whether the employees working there say so themselves. A large portion of the great work place assessment survey is based on the confidential information provided anonymously by the employees. This survey includes the demographic of the workers, general information such as the year the company was founded, the net revenue and benefits offered to the employees. This survey also consists of a series of open-ended questions that give the company an opportunity to share their philosophy and practice in the areas of employee development (Columbus, 2018).

OhioHealth has been delivering healthcare to the community since the year 1891, and has grown to be nationally wide recognized, it is a family of 29,000physicians and volunteers. It is a system of 11 hospitals. It has been recognized as one of the largest systems of healthcare givers in the U.S.  it has been recognized as one of the “100 Best Companies to work for” by the Fortune magazine for 12 consecutive years. The survey to determine if OhioHealth is a Great place to work was conducted on over 1000 employees of the company, on the Trust Index the company registered 95%. Results of the cultural audit found concluded that OhioHealth has programs that set it apart from other healthcare givers, these programs also reflect what’s best about their culture (Columbus, 2018).


OhioHealth is a reputable non-profit system of 11 hospitals offering healthcare in in over 47 hospitals in Ohio.  Its history dates back to 1891, when it was established as the first protestant church in Ohio. Over the years it has been known to deliver excellent healthcare. It offers heart and vascular treatment to its patients, it also offers rehabilitation for patients with heart related diseases. They go ahead and offer programs that prevent heart related diseases. Their cancer experts are recognized and members of MD Anderson Cancer Network. They also offer the best treatment for neuroscience disease. One of their hospitals, Riverside Methodist Hospital was recognized as one of the best in neurology hospitals in America. They also offer rehabilitation to patients with diseases such as cancer and Alzheimer’s.  they also offer programs that help patients with difficulties in processing grief. They have policies that in place to ensure that they meet their goals, these policies are contained in their code of conduct. It was also ranked as one of the Great places to work following a survey that was conducted on the employees, the culture of the organization, and the history of the organization. It was also among the “100 Best Companies to Work for”. Everything provided above confirms that they have achieved one of their top goals which was to provide quality healthcare to the community surrounding it.   





Columbus,OH, (2018). OhioHealth makes FORTUNE’s “100 Best Companies to Work For” list for 12th consecutive years. Retrieved from;   makes-fortunes-100-best-companies-to-work-for-list-for-12th-consecutive-year/

OhioHealth (n.d) OhioHealth Culture. Retrived from;            here/culture/

OhioHealth (n.d). Code of Conduct. Retrieved from;   

OhioHealth (n.d). Heart Health Starts Here. Retrieved from;

OhioHealth (n.d). Cancer Care. Retrieved from;     e=Cancer%20Care

OhioHealth (n.d). Neuroscience Care at OhioHealth. Retrieved from;   

OhioHealth (n.d.). Imaging and Radiology at OhioHealth. Retrieved;   

OhioHealth (n.d). Palliative Care. Retrieved from;      vice=Palliative%20Care













2580 Words  9 Pages

 A Case Study of the Vodafone Company

Vodafone is one of the biggest mobile company located in 27 countries, and in agreement with more than 35 countries. Vodafone originated from Racal Electronics plc, which was initially known as Racal Telecom Limited, in 1984. The company has over 71,000 workers all over the world and approximately 289 million customers by 2008. The number of Vodafone users in the United Kingdom is more than 19 million. The company's aim is to build trust and approval of the customers. Therefore, the company uses different strategies to achieve approval. The company believes that sustainability in business is the key to achieve the company's long term objectives.

Vodafone uses two approaches to business. The first approach is to provide new services, features and different dimensions in the market. Some countries like Europe, America, and the UK have customers who expect new changes in the products (Bach, 2010). New services and delivery methods attract more customers. Second, to search for opportunities in the new market. This includes the most remotes areas including some parts of Africa. People in remote areas experience communication problem, and Vodafone uses technology to advance communication which will help the community socially and economically.

Vodafone Marketing Strategy

Long term goals of a company can be achieved through cautious development. Vodafone Company uses the clarification of four Ps to makes its visions and mission clear (Curwen, 2004). This includes products, place, price, and promotion. First, the company has different types of Vodafone with modern features like games, quality camera, maps, and sending messages. Second, Vodafone has over 300 shops and also retail their products. Third, the company offers different ranges of prices in order to meet the needs of their customers. The price plans are changed monthly and customers are given a 1% bonus in every call made. Finally, the company does its promotion through TV advertisements, magazines, and other media. This ensures that the company's message is spread widely across the world.


Vodafone Company has a strong network coverage for calls. This makes Vodafone one of the best network company in the world. The company provides customers with the best airtime plans. Additionally, Vodafone maintains a good relationship with its suppliers through long term partnerships (Curwen, 2004). Purchasing a large number of products for a long time, Vodafone is able to negotiate for lower prices. The suppliers enjoy the partnership with Vodafone, due to guaranteed orders.


The large size of Vodafone's global market can affect standards and quality. Another weakness of the Vodafone Company is low-cost products. Vodafone holds that there is no compromise between low prices and offering high-quality products (Bach, 2010). Also, Vodafone has to maintain communication with the stakeholders about the company's activities.


Vodafone experiences threats which derive from various factors. One, the increased market forces. A lot of competitive companies have emerged, which provide their services at low prices. Therefore, Vodafone has to develop a unique feature to outstand from the rest. The second factor is the Economic factors. The collapse slows down user spending and disposable money reduces (Bach, 2010). Therefore, Vodafone addresses these problems in several ways. It manages weaknesses and pressures to create positive results.

In conclusion, Vodafone uses mobile phones to benefit both developed and developing countries. There have been increased effects of mobile technology due to improved features, and functions. The network has helped in the development of many developing economies.
















Bach, D., & Allen, D. (2010). What every CEO needs to know about nonmarket strategy. MIT

            Sloan Management Review51(3), 41.

Curwen, P., & Whalley, J. (2004). Telecommunications Strategy: cases, theory, and applications.



607 Words  2 Pages





Re: Green Clean product liability

In terms of making Green Clean Company’s product more liable, there is a need to ensure the product meet the required green product quality standard at all times for the company to stay safe from product liability issues. The absence of a deficiency within an item or services offered means that the firm has zero responsibilities on its part and it is up to the consumers to take full responsibility for themselves. In case of any defect, the firm needs to take note of the issues and make necessary amendments to the product to avoid a repeat of the same emerging defaults.

It is vital to note that not all product shortcomings are fatal to the consumer. However, when the customer’s well-being and welfare are under threat or the customer experiences injury as a result of coming into contact with the firm’s products, the product liability laws may harm the reputation of the firm.

For product liability laws to take full effect, the item must reach the market place and then end up in the hands of a consumer, commonly known as ‘privity contact’. In other words, the law must establish an association between the supplier, the individual hurt, and the supplier of the item in order for the law to take full effect and assist the consumer. However, in some states the laws ascertain that the injured person may not have bought the product for him or her to receive compensation. Some of the consequences associated with producing a fault item are paying a hefty compensation fee and utilizing legal fee to cover court cases.


275 Words  1 Pages


Unitedhealth Group


UnitedHealth Group Inc. is a for-profit American-based healthcare institution located in Minnetonka, Minnesota. UnitedHealth Group Inc. ranked fifth in the list of fortune 500 ranks in 2018’s list of largest United States companies by revenue collection. UnitedHealth Group offers their esteemed clients with insurance products, as well as healthcare products. 2017 results indicated that UnitedHealth Group became the largest healthcare institution across the world measured by revenue which was 201 billion USD. UnitedHealth Group runs additional companies offering services to about 115 million customers by the end of 2016 financial year.

Proposed Strategic Plan

Medicare and Medicaid

Medicare denotes the Federal government supported health insurance targeting individuals aged 65 years and above. Qudrat-Ullah, and Tsasis, (2017) argues that a young person suffering a permanent kidney disease might also be enrolled for the insurance. Since Medicare covers most if not all costs of treatment, then, UnitedHealth Group Inc. would incur an influx in the number of patients served aged 65 years or older seeking medical attention.

Patients over 65 years who seek services from UnitedHealth Group Inc. would get prepayment for their inpatient hospital care, hospice care, skilled nursing requirements and part of home-based care. However, the beneficiaries ought to pay a monthly premium in order to get covered, as the money would be used to pay for medical costs and pay medical practitioners who offer medical services within UnitedHealth Group Inc. the facility sells drugs, and the increased Medicare payer from 50% to 70%, then the Medicare would cater for most if not all of the prescription drugs for patients they handle. Patients who choose UnitedHealth Group Inc. as their primary healthcare and dispensing chemist would benefit from the increased disbursement.


Professional Turnover

An increase in turnover rates from 5% to 10% annually might result in detrimental impacts on UnitedHealth Group Inc.’s healthcare staff, patients and the hospital in general. According to Wolper, (2014), the firm would incur additional contingent staffing costs. It is estimated that the turnover in a facility like UnitedHealth Group Inc. consumes two to three times the normal pay of a regular personnel in the facility. The 10% turnover affects the direct costs within the facility as it impairs delivery of key services to the patients.

Directs costs associated with turnover in UnitedHealth Group Inc. include recruitment, training and orientation, plus additional costs incurred terminating the workers’ contract. According to Qudrat-Ullah, and Tsasis, (2017), indirect costs incurred by the healthcare facility include diminished productivity, pressure on the remaining staff, and owing that more staff turnover looms. The overall healthcare outcomes of the patients reduce. UnitedHealth Group Inc. might resort to travel, contract or agency nurses to deliver services to the facility replacing the practitioners who quit.

A 10% annual turnover rate results into acute shortage of the staff needed to perform core duties to the institution, which affects patient outcomes and satisfaction. Patients attended by satisfied nurses would translate the same satisfaction, leading to improved healthcare outcomes. However, patients attended by dissatisfied medical staff or those who intended to quit their jobs complained of poor health outcomes. A 10% turnover rate is associated with high mortality rate in healthcare facilities. Patient infection while undergoing treatment would increase by over 30% under such high turnover rates, (Wolper, 2014).

Demand for Services

An increase in demand for healthcare services by 20% would be treated like other markets by UnitedHealth Group Inc. the facility might increase the cost of key services rendered, while maintaining the quality of healthcare services. The high turnover rate already left a deficit that ought to get filled by new recruits to handle the current number of patients. However, an influx by 20% means that UnitedHealth Group Inc. would be under a severe threat to their operations.

Projected income statement

Quarterly Income Statement (values in 000's)










Quarter Ending:





Total Revenue





Cost of Revenue





Gross Profit





Operating Expenses





Research and Development





Sales, General and Admin.





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Operating Income





Add'l income/expense items





Earnings Before Interest and Tax





Interest Expense





Earnings Before Tax





Income Tax





Minority Interest





Equity Earnings/Loss Unconsolidated Subsidiary





Net Income-Cont. Operations





Net Income





Net Income Applicable to Common Shareholders






Project balance sheet

Quarterly Balance sheet (values in 000's)










Quarter Ending:





Current Assets





Cash and Cash Equivalents





Short-Term Investments





Net Receivables










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Total Current Assets





Long-Term Assets





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Fixed Assets










Intangible Assets





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Deferred Asset Charges





Total Assets





Current Liabilities





Accounts Payable





Short-Term Debt / Current Portion of Long-Term Debt





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Total Current Liabilities





Long-Term Debt





Other Liabilities





Deferred Liability Charges





Misc. Stocks





Minority Interest





Total Liabilities





Stock Holders’ Equity





Common Stocks





Capital Surplus





Retained Earnings





Treasury Stock





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Total Equity





Total Liabilities & Equity






Projected financial requirements

An increase in Medicare change from 50% to 70% and Medicaid from 5% to 10% means that UnitedHealth Group Inc. must have resources that meet the growing demands. It is projected that from Medicare and Medicaid the institution requires a budget increment by $30,300,000 to expand its operations to meet the growing demands. The annual professional turnover rates increment from 5% to 10% would also hinder basic operations from taking place. The healthcare facility requires about $ 20,000,000 to recruit, train and equip new staff who would replace the outgoing staff. Staffing costs would rise because the institution would experience more employee turnovers. Increased services by 20% in a year requires a reinstitution of the key operations to meet the growing demands. The healthcare facility currently serves over 11 million customers, which means that the number would rise by almost 3 million. The 20% increment in customer

 Financial sources

The total budget intended to meet the three key changes that took place at UnitedHealth Group Inc.


Medicare and Medicaid


10% Turnover


20% Increase in Demand for Services


 Total budget



The UnitedHealth Group Inc. requires an additional budget of $ 60,300,000 to accommodate its growing demands. Penner, (2014) adds that the firm has two alternatives of sourcing the funds needed to meet the needs of the institution. With the money at hand, UnitedHealth Group Inc. would be able to efficiently offer quality services to patient with little or no challenges.

Strategic plan

Decision making process

Accurate decision making in healthcare might become overwhelming due to the complexity of the issues involved in the day to day operations. Profit generation is the primary reason for the healthcare facility being in operation. The cost of healthcare ought to get addressed as it determines the growth of service delivery in healthcare. UnitedHealth Group Inc. must work with other stakeholders to reduce the costs of medical services. A long-term focus is essential in all decision making processes. The healthcare facility must also aim at reducing expenditure as it would translate to their patients.

UnitedHealth Group Inc. must handle their practitioners like business partners so as to make them feel secure. Acknowledging the efforts of practitioners reduces turnover rates by a big margin. The doctors must be involved in key decision making processes and management activities. The presence of the physicians in the board meetings makes them feel part of the facility and promote their success.  

Revenue growth rate

According to Ward, (2015), the UnitedHealth Group Inc. must reason beyond Medicare. Millions of patients are under the Federal insurance Medicare and Medicaid but still there are many patients that are self or privately insured. Being that UnitedHealth Group Inc. offers medical insurance among other services, they ought to think beyond what they expect. Making use of alternatives keeps the facility planned ahead, and thus increase profit making potential while reducing the financial risks.

Turnover rate capacity

With the funding in place, UnitedHealth Group Inc.’s human resource intends to work on improving talent acquisition among its existing staff. Wolper, (2014) argued that other than seeking medics to fill positions, they ought to develop and improve talents. The newly hired staff must fit the institution’s mission, values and vision. The major areas of concern for the new recruits include patient satisfaction, morale, safety of the staff and patients and quality services.

Assessing the behavior of all staff would let UnitedHealth Group Inc. understand the skillset of each candidate. According to Herkimer, (2017), the hiring process gets improved depending on the behavioral competencies desired from them. The weaknesses and strengths of each staff might be compared with the industry requirements. The organizational expectations and abilities of the recruits creates a gap that must be filled if quality services are to be delivered to the patients.

In summary, UnitedHealth Group Inc. is a healthcare facility offering medical services to Americans, and other patients across the globe. The 10% turnover affects the direct costs within the facility as it impairs delivery of key services to the patients. The UnitedHealth Group Inc. requires an additional budget of $ 60,300,000 to accommodate its growing demands. The firm has two alternatives of sourcing the funds needed to meet the needs of the institution.


Herkimer, A. G. (2017). Understanding health care budgeting. Rockville, Md: Aspen.

In Qudrat-Ullah, H., & In Tsasis, P. (2017). Innovative healthcare systems for the 21st century.

Penner, S. J. (2014). Introduction to health care economics & financial management: Fundamental concepts with practical applications. Philadelphia: Lippincott Williams & Wilkins.

Ward, W. J. (2015). Health care budgeting and financial management for non-financial managers. Westport, Conn: Auburn House.

Wolper, L. F. (2014). Health care administration: Planning, implementing, and managing organized delivery systems. Sudbury, MA: Jones and Bartlett Publishers.


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