Please, answer both parts. I will rate your answer from two accounts. 2. Comment
ID: 1124495 • Letter: P
Question
Please, answer both parts. I will rate your answer from two accounts.2. Comment and Analysis :(24 points) A. (16 points) In reality sometimes a manufacturer finds it hard to induce retailers to make good sales effort. For example, Toyota may find that its dealers in NYC are unwilling to make enough contribution to the local marketing campaign of its new model. Please explain in detaii why in general it is difficult for retailers to make more or better sales effort. Please also provide practical solutions to the problems you just identified. B. (8 points) In the airline industry, airline companies usually share many common flying routes. For instance, in 1998 Northwestern and Delta appeared jointly in 323 common routes. Some empirical studies found that the more common flying routes between the airline companies, the higher are the average airfares over these routes. Please comment and explain this finding in detail.
Explanation / Answer
The manufacturing company produce new product and they finds it difficult to induce retailers to make good sales efffort. The retailers are doing there business all over the world for a multinational manufacturer. For example here Toyota has retail branch in various countries. Actually the retailer finds the actual competition in the car market. The seller forcast a target and make some new brand product. But ultimately it is the retail seller who makes the ultimate marketing. The reason behind the less interest of the retailers may be as follows -
i) Less incentive : Whenever reailer finds that he or she will receive very little amount of money as a incentive for selling a new product. Most of the margins are appropriate by the higher level sellers and sales managers.
ii) Increasing Competition: Day by the day there increase in competition and they are facing it very difficult to sell it by taking all the all the preference aspect of the buyer. There is lots of other company doing their business and they face it very difficult to sell so they are not getting any inspiration to sell more and more product.
iii) High target achievement: The company always give a a little bit high target of sells. They set a target for selling the product but in the competition when they fail to achieve that target he gets lots of disincentives and they do not get any kind of applaud for whatever achievement they have got.
iv) Changing preference of customer fail to fulfill the changing pattern of customer : Manufacturer company makes varities of product and the ratailer have to sell that and they do not have any role to meet the consumer preference and whatever product they have they have to run their business with their product. So this time whenever customer are prefering some other brands they face it very difficult to maintain their sell and they becomes very less incentive.
v) Small target : Some times retailer has a very little target from its own aspect. When that target is achieved by the retailers then the retailers do not very much interest to increase the sell.
v) Lack of communication between higher authorities and retailer : Every company set a target of their sell at their decision making level. But this target do not tactically distributed and communicated with the reailer. The reailer came to know about the target through sales manager and they try to push their target to reailers and when reailers face it difficult to achieve that target they do not get any appreciation.
vi) The overall sales plan always do not match with a specific region : There is overall a sales plan of a company. But this sales plan can vary region to region and the reailers do not get appropriate chance to sell the products with their own srtrategy. They try to implement their strategy and retailers get less incentive.
The practical solutions with these problem can be as follows -
i) Proper appropriation of retailer at every level sales: There should be good appropriation of reailers at every level of sales they achieve. The company has to understand that the the retailers are the ultimate agency who make the sells effective. So their effort should be appreciated at every level.
ii) Set a small target and incentives for retailers: If company gives incentive at resonable level at every level of sales then they get inspiration and the target of sells shold be according to market condition and situation of the economy.
iii) Increase the incentive and margin of sles for retailers : If company gives more incentive at lower level of sales they get the initiatives for more sells.
iv) Communicte more properly with retailers: The higher authorities should communicate more properly with the retailers and there should not be any information gap and wrong information to the retailers.
B) Generally airlines company has many coomon routes and the airfares are on an average high in these routes. The airlines company has their prcing strategy in every routes. The routes which are common are the majorly very busy roots . Let suppose California to Washington or Newyork city. So in the common rotes there are generally high demand of passengers and they can get higher price for that. Now though there are lot of airlines company but as the demand of tickets are very high in these common routes then generally the price of tickets rises . Another reson can be that there can be a understanding among the airlines companies to set the price high in these common routes. So when any one buy the ticket he or she can face that there is always a same fare between these routes. Though these fares are high comparatively if we consider the distance and another rooutes of airline companies. So these price can be higher becuase of understanding of price rise among airline companies.