Vanda-Laye Corporation: Recommendations on Investments

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Table of Contents

Introduction
Course Project Summary
Marketing Factors Influencing the Success or Failure of the Product
Capital Budgeting Role
Consequences of Government Intervention
The rationale for the Product Recommendation
Conclusion
References

Introduction

Investment plans require the assessment of various factors, including the analysis of consumer preferences, market competition, a share of expenses and income, and other essential aspects. Based on the experience of the Vanda-Laye Corporation, it can be seen that effective strategic management concerning economic development contributes to high demand for goods and steady profits overproduction and advertising costs.

To evaluate the possible tactics of investing and distributing finances, it is possible to consider the activities of another company concerning its marketing plan. Since the Vanda-Laye Corporation is engaged in the production and distribution of outdoor cooking supplies, as an example, the sales of such a product as a portable gas grill may be analyzed. It also falls into the category of cooking equipment and is a modern device that may interest consumers. To calculate investments in the promotion of this product correctly, it is necessary to take into account such criteria as capital budgeting, government participation, market competition, and other factors.

Course Project Summary

When summing up the course project, it can be noted that the recommendations given to the corporation in question are effective practices in planning investments and drawing up relevant financial strategies in a competitive market environment. In general, the company’s economic system was stable enough, and all the dynamic changes aimed at increasing consumer interest and, as a result, profits, were implemented successfully.

Toshimitsu (2018) introduces the concept of price-setting games, and while evaluating marketing strategies in the context of this principle, the Vanda-Laye Corporation developed them efficiently since all tactical financial schemes turned out beneficial. Substitution and income effects took place, and the corporation had to adapt to the current market conditions, for instance, by analyzing inferior versus normal goods and drawing up plans to minimize costs and, consequently, increasing the share of profits. Nevertheless, all the steps were thought out, and ultimately, based on the indicators of derived demand, the company managed to win the trust of consumers and strengthen its position.

Speaking about the effectiveness of the proposed recommendations, there were no significant changes in real and projected incomes, and all planned business optimization programs were implemented. Certainly, deadweight losses were inevitable; however, in any business, resources have to be sacrificed to provide a stable platform for growth, and the Vanda-Laye Corporation has coped with this task.

The combined activities of the organization and consulting firm proved the effectiveness of a monopolistic structure and its merits. Therefore, when summing up the results of the project, the goals of increasing the profit of the organization in question, and its role in the market of similar products have been achieved.

Marketing Factors Influencing the Success or Failure of the Product

When analyzing market factors affecting the success or failure of the aforementioned product, namely a portable gas grill, several criteria are to be taken into account. The parameter of filling the market is an important aspect of a goods promotion process. In case many samples of the same product will be presented, the probability of success of sales will below. High competition may be a significant obstacle to gaining profits.

Also, as Toshimitsu (2018) remarks, “the concept of a fulfilled expectation” can be useful for successful product introduction. If some consumers manage to see the merits of a particular grill model, it will become an additional incentive for many customers due to a large number of positive feedback. Nevertheless, there is also the possibility of failure because if samples promoted by competitors have higher technical and operational characteristics, the share of sales will not meet producers’ expectations (Chen, Wang, Huang, & Shen, 2016). Therefore, all these aspects are essential for competent investment planning and market introduction.

Capital Budgeting Role

When recommending an appropriate promotion strategy for the product in question, it is necessary to take into account the role of capital budgeting since this indicator may have a significant impact on sales results and final profits. According to Almazan, Chen, and Titman (2017), if sellers have a clear plan for sharing the resources needed for internal costs, “favorable information in this setting encourages stakeholders to take actions that positively contribute to the firm’s success” (p. 2179).

In particular, while taking into account both fixed and variable costs, the preliminary assessment of the share of profits helps to prevent bankruptcy and reduce the likelihood of financial risks caused by too high expenses for taxes and rent. Therefore, the role of capital budgeting is significant when planning all the aspects of investments.

Consequences of Government Intervention

Government involvement in resolving business issues may affect the implementation of the product under consideration. Authorities’ intervention can be a significant obstacle if certain bans are imposed on special goods. For instance, if portable gas grills are recognized as potentially unsafe devices, it may influence sales negatively. However, the poor outcomes of officials’ participation are not inevitable.

As Yoon, Kim, Buisson, and Phillips (2018) argue, “the government affects entrepreneurial activity differently, depending on the particular freedom restricted by the government and the entrepreneur’s motive” (p. 245). In the case of authorities’ positive assessment of the product sold, it can be an additional effective marketing step. Regarding the grill in question, there is no reason to doubt that the government will ban its sale. This device is environmentally safe and harmless, which is his main advantage. Therefore, there are no significant concerns that officials will ban the sale of this product.

The rationale for the Product Recommendation

The considered portable gas grill can be recommended since this device has enough advantages over standard ovens. In general, this product complies with the current trends of outdoor recreation when there is no access to electricity. In the description of this grill, it is possible to specify all the advantages of its operation compared to conventional mobile ovens. Also, one of the rationales for product promotion in the market may be its uniqueness since the portability of the device is its valuable property, which distinguishes it from the products of many competitors. All these features suggest that there is no reason to stop a marketing program because the merits of such a grill and its technical characteristics will most certainly be in demand among consumers.

Conclusion

Different criteria should be taken into account when drawing up a plan of investment recommendation. Based on the review of the course project, it can be noted that the analysis of market factors is an important component of price-setting strategies. Capital budgeting and cost accounting help to invest resources wisely, making a profit, and avoiding serious risks. Recommendations for promoting the considered grill are justified since due to the numerous advantages of this product, its introduction into the market will be accepted positively by both officials and consumers.

References

Almazan, A., Chen, Z., & Titman, S. (2017). Firm investment and stakeholder choices: A top-down theory of capital budgeting. The Journal of Finance, 72(5), 2179-2228. Web.

Chen, K. H., Wang, C. H., Huang, S. Z., & Shen, G. C. (2016). Service innovation and new product performance: The influence of market-linking capabilities and market turbulence. International Journal of Production Economics, 172, 54-64. Web.

Toshimitsu, T. (2018). The optimal choice of internal decision-making structures in a network industry: A multiproduct monopoly case. Managerial and Decision Economics, 39(6), 690-697. Web.

Yoon, H. D., Kim, N., Buisson, B., & Phillips, F. (2018). A cross-national study of knowledge, government intervention, and innovative nascent entrepreneurship. Journal of Business Research, 84, 243-252. Web.

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