Case Study Solving

The case gives us the clear picture that how the household furniture industry was working…..  And this case is also telling about how the growth & sale was affected as the industry was highly unorganized..  the household furniture industry will grow 1.9% to 2.9% annually for the next 15 years….  The production cost was very high due to which the profit was very low.. 

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There were some external factors which were also affected scale.

External factors:1) the marketing strategy adopted by industry and distribution was not up to the mark.

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2) time lagging was also another factor. 3) furniture sale was highly depended on consumer credit..

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Shorterm objective:increasing sale & improving delivery system ..

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Long-term objective:to make the households furniture industry organized & competitive…

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This sector is highly unorganized & percentage growth of marginal scale was declining per year from 25.4% in 1983 to 78% in 1985.

1)Industry was labor intensive high wage rate was one of the reason for production cost. 2)Lack of professionally managed organization.. 3)Poor marketing strategy..

While reducing cost quality should not be compromised. Competition should increase so that costumer is benefited.

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Mergers & acquisition.

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Contract manufacturing.

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Government aid.

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Production will be done on last scale it will reduce the cost. Companies can take discount on bulk purchases of row materials from suppliers. Companies by using automated and latest technology machines can reduce time in production. Optimum utilization of resources will be there. Just in time(JIT) strategy can also be followed.

To decide in which company to invest or which firm to merge & acquire.. We should have also take a close watch an the potential of growth of the firm this decision involves to following steps.. Comparing the firm . Placing of bid on the business & negotiating with seller ... Purchase of business firm is done… Properly managed …

Company strategy regarding contract manufacturing should be like that, by contract manufacturing companies get product at righy time at right place and of right quality and in right quantity. Due to it companies can concentrate on other productive and effective works like companies will improve its marketing efforts.

It is being observed through out the case that it is households furniture industry is highly unorganized and it marketing strategy and means of production are also not effective... It is suffering from economic crunch. Mergers & acquisitions will provide companies a professionally managed organization, Companies will adopt good marketing strategies.