Business Planning and Development - Essay Example

              The company offered products and features that were acceptable to the customers. This not only increased the sale rate but also reduced the cost of products. The cost leadership strategy had a positive impact on the company. It ignored the different market segments and focused on the mass market (Porter 1997). The advantages of employing this strategy were that the company charged lower prices, yet got the same profit. The market shares were protected from rivals. The business had the opportunity to reduce its price to compete with the substitute products. All these advantages have secured the business and given the rival competitors a hard time.

                    The difficulties that the company faced were the technological advancements that the rivals brought, like better features at low prices. The imitation ability of the rival was another hurdle for the company (Cost Leadership Strategy 2010). Following the low-cost strategy, our company has targeted fewer markets as compared to rivals to have a balance between price and cost of the product. The other difficulty that the industry has encountered was related to the market share. Some of the rivals also opted for the low-cost leadership strategy due to which our market shares were reduced. This was coped up by investing in advertisements on various advertising channels, which helped in regaining the shares (Ahmed, 2003). When the rivals decided to introduce new products with differential features and low costs, the company again faced problems (Lehner, 2004). To avoid any loss due to this threat, our managing team had a regular and close inspection of the steps that were anticipated by the rivals. The biggest challenge for our company was to provide unique services to the customer and to satisfy a maximum number of customers. In achieving this target, we have invested and worked a lot. We have hired consultants, creative teams, and professional marketing staff. All of these helped in making a position in the market and increasing the sales and profit of the company.  

                    The plans that the company has for the future include expansion of the target market, enhancement of customization for the consumers, and an increase in production units. This requires more assets and operating expenses. For that, the company needs a loan from the bank so that the operations and sales do not get messed up due to a lack of expenses and opportunities. The trade-off related to these expansions may be the cost versus benefits. The benefit that the company may get is the profit. And the cost is the cost of expansion and other operating expenses. Benefits and costs are often expressed in monetary terms and are adjusted with the money value, which makes the flow of benefits and of costs to be expressed on a common basis of their actual and present value.  The biggest problem with this trade-off is the accuracy. The estimation of the cost and its benefits doesn’t need to be always estimated accurately. If things do not work out, the cost versus benefit may be a subject risk of bankruptcy. For that, the company must have enough operating expenses by which it can keep the company working.

                       The establishment of the business requires a lot of sacrifices and commitment. On a personal note, the commitments that I had to make included the sacrifices of one’s own needs. The lack of prioritizing basic needs leads to an unbalanced lifestyle that affects us physically, emotionally, mentally, and socially, and prevents us from achieving our goals. Only when we learn to commit our lives truly, will we be able to be our best, and help the organization be its best as well. Establishing a great enterprise can put a lot of pressure on an individual. We had to sacrifice certain areas of our lives in establishing this business. Things such as the physical needs for rest, peace of mind, or time spent with our families. “Our team is highly committed and motivated in terms of goal achievement and entrepreneurial growth (Authentic Commitment, 2004)”. They have paid the price by making substantial sacrifices in their personal and professional lives, such as recreation, loss of savings, sporting events, undesirable responsibilities, working 60 hours per week, and training costs.

                The simVenture has helped me in understanding real-world business. It has allowed me to decide at times of difficulties and threats. It has assisted me in understanding real-world situations where you have to opt for the most suitable strategies even when you know that rivals and competitors are present. It has helped in understanding the basic management functions, quantitative and financial knowledge, and skills that are needed to manage a business