The Effect of Unemployment on the UK - Assignment Example

11) Analyse the probable effects of an 8% rate of unemployment on: a) The UK national economy (6) An eight percent unemployment will affect the UK national economy in that it will fall drastically in that those who are unemployed will not be able to contribute in helping in stabilizing the economy or helping it to grow. If anything, they will drain it in that they will start to collect benefits for unemployment. This drop in the national economy will cause prices to inflate on goods in that the demand will decrease, so businesses must make up for it somehow. On top of a decrease in demand for the supply that will result from the fall in the economy from the high unemployment rate, there will be more foreclosures, as businesses will have to lay off more staff if they are not meeting enough of a demand for their supply. A rise in foreclosures will hurt businesses in that those who can be potential customers will not be in that they are now not concerned about doing business with companies to obtain the things they want, they now have to be careful with their spending, purchasing only what they need and not what they want. Sometimes, they may not even be able to purchase the things that they need. Almost everyone in some way shape or form will feel the effects of the damage that an eight percent unemployment rate to have on the national economy. b) UK international trade (4) If there are problems in the UK, as far as the economy is concerned, there will also be problems with UK international trade in that there will be less goods to export, being that the workforce who will contribute to producing such goods will have dropped due to lack of employment that has resulted from the fall in the economy. Not to mention, inflation will also affect the international trading in that other countries will have to pay more for goods, which in the long run will hurt profits. This will hurt the economy considerably in that the UK will not be able to make money from outside sources as easily as before. c) Candleford Ltd. (4) The significant unemployment rate will cause there to be a lack of demand for conservatories, which will cause the customer base for Candleford LTD to be significantly less. Unemployment means that there will be a number of foreclosures. The more foreclosures there are, the less that will have homes, and if people cannot hold onto their homes, then conservatories cannot be installed and purchased. When the demand for conservatories drops, this effects everyone at Candleford Conservatories LTD, as the lack of demand can effect whether or not some will continue to have jobs, since the profits that the company brings in supplies workers with their salaries. 12) Illustrating your answer with examples related to the case study; explain the difference between strategic and tactical business decisions. (6) The differences between strategic and tactical business decisions are that strategic business decisions would use the company's history to make future business decisions, carefully strategizing what moves will be made next, as it pertains to the success of the business, and tactical business decisions are methods that the company will be able to employ in order to be successful, such as what tactics that will utilize to target their client base and improve their operations. An example of a strategic business decision is when Paul analyzed the company's history before he made any decisions about the company's operation. For instance, he paid attention to what his father did. He took not of what worked and what did not and carefully considered all factors before taking a first step. A tactical business decision was made when Candleford had to figure out how they would function in a down turning economy where not only did the industries that they so heavily depended upon were drastically effected, they had to be creative in getting customers to purchase conservatories. 13) Giving reasons to support your opinion, explain: a) Which industries or sectors of the economy are likely to suffer less than the economy in general in a recession, and (7) The sectors of the economy that are likely to suffer less compared to anything else in the grand scheme of things as it pertains to the overall general economy are the IT, communications, manufacturing industries. IT will not be affected as much, since a lot of our daily routine depends on technology, and people always need to either have their technology fixed, or they need to purchase new stuff. Not to mention, most businesses, if not all of them, depend on some form of technology to get the job done. Technology is the cornerstone of our lives today that there will always be a large clientele in this industry. The communication industries will not be affected as much in that communication is central to our existence. Everything that we do today depends on using the phones and Internet. The old ways have since been forgotten. Like technology, communication systems are also a cornerstone of our society. And as far as manufacturing is concerned, goods will continue to need to be manufactured, hence the reason that this industry will not feel the effects of the downfall too badly. We all depend on manufactured goods in some way shape or form, whether or not we need clothing, toys, tools, or other things we may make use of in our daily lives. This industry, like the other two aforementioned, is also a cornerstone to our society. b) The extent to which Candleford falls into this category. (5) Candleford does not fall into the categories that are safe from feeling the horrible effects of the economy. Being that the industries that have invariably been affected are the automotive, air travel, and the real estate industries. Being that Candleford Conservatories LTD is part of the construction industry, and being that the company heavily relies on the other two industries to continue to be successful and remain in business, such as using automobiles to drive to customers and pick up supplies and relying on planes to ship various supplies to the company from other suppliers, the company has begun to feel the pain caused by these losses. While the focus of Candleford Conservatories LTD is on how the economy and the future of it will affect the company as a whole, Candleford Conservatries LTD needs to take steps that will insure our stability. In order to preserve the solvency of Candleford Conservatories LTD, as well as to insure the success of the company, some changes need to be made to the company's operations, as well as how they target their customers. 14) Taking into account the prevailing economic climate, justify an appropriate corporate strategy for Candleford. (8) In a prevailing economy, an appropriate corporate strategy for Candleford is that the company will work on cutting costs in areas where unnecessary spending is occurring, so that the money can be put into other parts of the company. Along with cutting costs, other necessary changes will need to be made. The first change that will need to be made to the operations of Candleford Conservatories LTD is how supplies are purchased. Being that supplies chiefly consist of brick, glass, and other materials that are necessary for constructing conservatories, it is important that Candleford takes whatever means possible to cut costs in this area because it will enable the company to drop prices and still make a decent profit while at the same time, customers will be able to better afford these conservatories, as the price will be something that they can handle. Candleford can cut cost on supplies by purchasing them in bulk from suppliers that are willing to sell to the company in a manageable bulk rate. This will involve some sort of negotiation with various suppliers to see if such a thing can be accommodated. Home improvement wholesalers are the first places that Candleford will need to target, as they are the ones likely to give candleford decent rates, much better than the company is paying now. Obtaining supplies at decent bulk rates will enable Candleford to save even more money. Best of all, Candleford will be able to achieve this without reducing the quality of products or cutting corners that may sacrifice how well the job is done. While only dealing with wholesale suppliers who are willing to negotiate a decent bulk rate is key to success, Candleford must be choosey as to which suppliers they deal with. Being that the air travel and automotive industries have been affected immensely by the down turn of the economy, it is fitting that Candleford deals with suppliers who are close by, so the changes in the air travel and automotive industries do not have much of a negative impact on the company. Dealing with such suppliers will allow Candleford to save a great deal of money that the company would otherwise be spending on shipping, as well as for the gasoline that is used to power the vehicles, if company staff should have to pick up the supplies themselves. Keeping trips short and keeping the mileage to a minimum will take part in enabling Candleford to offer customers fabulously built conservatories at very competitive prices. If Candleford continues at the rate they are going, this will not be so. Then there is the change that will need to be made concerning how workers are paid. Those who are working in the construction sector of Candleford Conservatories LTD will be paid via a salary. Those who are also working in clerical positions will receive a salary, as well as those who are working in managerial positions. Sales representatives, however, will be paid commission only. This is to insure that they are motivated to put their best efforts into their work, as their income will depend upon this. Not to mention, this will insure that Candleford has only the best sales representatives for the job, as they will not make much if they are not good at selling customers on purchasing conservatories. The final change that Candleford Conservatories LTD will need to make to their operations is that some of the employees will be telecommuters. This means that rather than coming to work at the office, they will work from their homes. Allowing some of the employees to telecommute will enable the company to save more money, as they will be working with their own supplies, rather than the office having to supply necessary equipment and supplies for them, such as computers, ink, paper, and other pertinent office supplies needed to complete their daily tasks. Not to mention, employees will be using their own phone and Internet connections for correspondence, rather than Candleford supplying them with these necessities. Employees using their own phone lines and Internet connections to work will enable Candleford to save a significant amount of money, as this will cut down on company bills, allowing the company to put money to better use, such as for growth and expansion. Not to mention, profits will be larger, enabling current employees to still remain employed, while also remaining successful, which has a large bearing on whether or not Candleford Conservatories LTD will continue to remain successful and solvent for future decades to come. Those who will be telecommuters are secretaries, sales representatives, and managers; as such jobs are able to be done remotely. Employees who are telecommuters will purchase all of their own supplies and write it off on taxes at the end of the year. In addition, they will save gas and will not have to travel in poor weather conditions to go to work. This is a win win situation for all, as nobody will lose out. While on the subject of telecommuting, we must discuss how meetings will be held with company personnel. At present, the company now have meetings at company headquarters. While they can have meetings at the office building every so often, let's say once every six months, and these meetings must be of great importance and not on the same level of mundane company meetings, it is more beneficial that they have them in the comfort of their homes via web or phone conferencing. BUSINESS ORIENTATION (40) 15) Discuss the extent to which an organisation's (such as Candleford's) marketing strategy something different from its corporate strategy (8) The marketing strategy of Candleford LTD would be much different than its corporate strategy in that the market strategy would be used to target customers and hopefully close sales, which would expand the client base and increase profits. The marketing strategy solely focuses on how people on the outside will respond to the company's products and services. The marketing strategy is all about making the customers pleased, so they will not only want to come back later to do business at another time; they will also recommend others to do the same. The corporate strategy, on the other hand, focuses on how people and operations on the inside of the company will run smoothly together to insure that the company remains successful. Corporate strategy would be used to help the company to remain stable and solvent, such as by cutting costs, optimising company operations, and expanding the business. Though these strategies are different, indeed, they are both paramount to the success of Candleford Conservatories LTD. 16) Evaluate methods Candleford might use to assess its strength in its marketplace. (12) To evaluate the strengths in their marketplace, Candleford can take surveys from their customers, such as by asking how they heard about the company, which will enable them to get information from their customers. This will enable them to see not only the strengths in the marketing strategy that they decide to employ, but it will also help them to see the weaknesses, as Candleford will know what they need to improve upon, meaning that they will be able to assess what does work well and what does not work, as far as marketing is concerned. 17) Explore the marketing aspects of Candleford diversifying into either One of the areas on Paul's list of energy-saving products, or A product or service that could reasonably be added to that list: One of the energy saving products that can be added to the list that Paul is drafting is window glass that will enable heat or cool air to stay inside. Windows have everything to do with whether or not a person saves on his or her energy bills. A service that can be reasonably added to this list is the installation of solar panels that will bring power to the conservatories, so they will not run up electric bills by running all of the home electric system. Furthermore, if customers want to convert their homes to solar power entirely, Candleford workers can arrange for this to happen. a) Identify the target segments for the product and explain whether the diversification is related or unrelated (product or market development) (7) Those who can be targeted with energy saving producs, such as what was listed above, are homes and resort and spa businesses. Homes can be targeted in that customers will be happy to know that they can save on their energy bills if such materials are used to build these conservatories. Resort and hotel businesses will be happy to know the same, as they are always looking for ways to cut costs and save money, and energy saving products is the best ways to do it. This way, these businesses can have beautiful conservatories that attract a wide range of customers, and they will save money on energy at the same time. As far as whether or not the diversification is related or unrelated, they are, indeed, related in that they are relevant to the concerns that the government has in regards to climate change, as well as to concerns that customers have in regards to saving energy and keeping costs down. b) Justify an appropriate promotional strategy for the product (8) To promote such products, one can stress the benefits of saving money, as well as energy, enabling the customer to have more money in his or her wallet while at the same time, not having to use a lot of power to keep temperatures in the building or home comfortable. Such promotions can be done through the use of brochures, postcards, meetings between customers and sales representatives, and Internet Ad campaigns. Postcards are wonderful for targeting the niche because it engages them on a personal level. Postcards are a form of advertising that is personal, warm, and friendly; yet, they let the customers know that Candleford exists and can be used, should they desire to have one of the finest conservatories built for their home. Brochures are a wonderful means of advertising, as they will contain some information about the company, as well as some pictures of past works, enabling the customers to feel that they can put a sense of trust in Candleford to do a job well done. Brochures, like postcards, can also be made to reach the customer on a personal level, as short biographies of the owner and founder, as well as other important company staff can be contained as part of the text. Brochures can be left at the checkout counters of home improvements stores, as well as at other places that pertain to home remodelling at the descression of the owners of such establishments because when customers shop at such places, home improvement is already on their minds. Brochures are a fabulous way to give them some wonderful ideas in regards to home improvement, as now they have another project that they may want to consider or even take on for themselves to create their perfect dream homes. Not to mention, having company brochures in this type of environment has a greater chance of calling customers to action. Along with the postcards, Candleford can have face to face meetings. These meetings will be lined up in such a way that sales representatives will meet with customers to discuss their options. Advertising in this format is especially wonderful for the spas and resorts that Candleford will target, as the company will be able to show them all of the benefits to having conservatories on their establishments. Some of the benefits that Candleford will outline when targeting resorts and spas is that the conservatories will attract a wider customer base because not only due to the fact that conservatories give their establishments a more elegant appearance, they will enable customers to enjoy yet one more spectacular feature that they have to offer. Candleford will also want to emphasize that attracting a customer base means that they will bring in larger earnings, which will contribute to the stability, success, and the solvency of their businesses for future generations. The goal for the sales representatives is to do everything to convince the owners of these establishments why having a conservatory is the next best thing for their businesses. Finally, there are Internet ad campaigns. These campaigns are wonderful in that they can reach large volumes of people with little effort. Candleford can pay a company to do the work of seeing to it that ads are placed appropriately about the Internet, and the website ranks high in the search engines. All of these promotional methods put together will enable Candleford to reach a wide range of customers. c) Estimate the costs of your promotional strategy to Candleford (5) The estimated cost to Candleford for its promotional strategy will be the following: Postcards will cost five hundred pounds a year, being that they will not have to be sent out often. Postcards are a personal form of advertising, and it would not be in the best interest to bombard customers with them. Not to mention, customers will be aware of Candleford's presence, as other forms of promotion will also be used. Brochures will cost approximately three thousand pounds, as it takes more money to print them out than the postcards. Internet advertising will cost approximately twelve thousand pounds annually, as the Internet marketers must be paid for their services of site promotion and search engine optimization. BUSINESS MEDIA (20) 18) In the weeks following the Bucks on Sunday article, between a half and a whole page of each edition has been devoted to "cowboy builder" stories, potentially bringing the whole industry into disrepute. Paul thought that when this happened buyers tended to favour larger firms in the belief that more pressure could be brought to bear if they were not satisfied with the end product. This would obviously not be in Candleford's interests. He asks you, as the incoming intern, to draft a letter to Bucks on Sunday extolling (but not too obviously) Candleford's virtues. (20) Dear Editor; It is to our understanding that the entire industry has been brought into disrepute, as a result to the cowboy builder articles that have been published in the papers within these past few weeks. This is quite distressing to say the least, as there are a number of companies within this industry who do care about offering a fine end-product to customers, as well as services that are of the utmost quality, and maintaining a good work ethic is important to such companies because there are still a great number of people in this industry who still believe in honesty and integrity, and these recently published articles portray the industry in such a way to make readers believe as if none existed any longer. Being that this is the case, we strongly feel that the articles that you have been publishing to disrepute the entire industry is unfair, to say the very least. The companies who actually do care about their work would duly appreciate if articles were published that portrayed the entire industry in a manner that is fair, rather than condemning the entire industry based on what some companies do or fail to do. We certainly understand that there are, indeed, companies who couldn't care less about their client base and rush through the job to get things with over quickly, and we also understand that there are companies who cut corners to make a sizable profit at the hands of their customers, such as by offering cheap product, which causes the job to be substandard, but please understand that there are companies who do not operate in this fashion and are happy to offer the customers nothing but the best. Companies who do business in this fashion truly value their customer base, and they know that a good work ethic, offering outstanding products and services, and operating with the utmost honesty and integrity will not only cause their customers to do business with them in the future, these happy customers will more than likely spread the word, keeping these businesses operating for years and even decades to come. We appreciate what you are trying to accomplish by writing these articles, such as protecting people from being scammed or taken advantage of, but all we ask is that you go about doing this in a better way. It would be to our liking if you brought to light the bad things that some companies within the industry are doing, along with shedding light on the good of other companies who deserve it. This way, the industry is represented in a fairer light, and customers will be able to not only differentiate the good from the bad, but they will be able to choose the companies that provide them with products and services that are of the utmost quality. We look forward to seeing these changes, which will bring about a brighter tomorrow for all involved. We thank you for the time that you have taken to read this correspondence. Best Regards, Candleford Conservatories LTD Read More