CVP simulation
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Having difficulty understanding the analysis to determine total market share, revenue, cumulative profit, consumer net price, modular price, unit cost, etc. and the cause and effect. Developing significant data to make the determination. Determine the significance of new entrants into the PV industry, what is the impact that new competitors have on your company's market share, cumulative profitability, cost to the consumer? I have attached the issue.
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The response addresses the query posted in 1485 words with APA references
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The response addresses the query posted in 1485 words with APA references
//In the following paragraphs, there will be an analysis of the impact of new competitors entry into the market Sun Power Company in terms of market share, cumulative profitability, and revenue. There will also be a discussion on the pricing strategy and process improvement strategy to provide stiff competition to new competitors in the market. There will also be a focus on consumer net price, modular price, and unit cost regarding the competitiveness of the company. //
The results of simulation runs in SLP 2 clearly supports that reduced pricing strategy is favorable for the company to increase the market share, revenue, and cumulative profitability. The reduced pricing strategy will be beneficial for the company in SLP 3 also because low price increases the competitiveness in the market. The new entrants are not much able to reduce their price at a low level to face the competition from the existing firms. The basic purpose of SLP 3 is to evaluate the performance of the company with consideration of new entrants in the market. SLP 2 was simulated without entry of new competitors whereas SLP 3 will consider the entry of new competitors in the market for the purpose of evaluation of the performance of the company. There will be a need to run the simulation for SLP 3 for four times with changed pricing strategy to see the impact of reduced price on the market share and cumulative profitability of the company.
1) Decision 1: For Years 2008-2012
Inputs
a) Pricing - Manual, b) Module Price - $0.13, c) Revenue to Process Improvement - 5%, d) Years to Advance - 5 years
Both SLP 2 and SLP 3 have same inputs except the entry of new entrants. SLP 3 allows the entry of new competitors in the market. Inputs for both SLPs include pricing, process improvement, and year advance. Both SLPs have the price of $0.13 whereas the process improvement is 5% with year advance of 5. The decrease in the price will help the company to improve its performance in the ...
Education
- MBA (IP), International Center for Internationa Business
- BBA, University of Rajasthan
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