Their costs for customer service remained at the same value. They retained the same amount of cash reserve in the end of this period one as period zero. They also did not tamper with any pricing strategy and kept a markup of 49.48% for channel 1 and 2.They kept the same number of sales representatives. They used to have equal distribution for both channels but this year they increased quantities of channel 1 and the weight of the units sold were heavier than channel 2. It must be noted that all products ordered in period zero were sold and disposed leaving no ending inventory for the firm but this was not the case in period 1. No changes in strategies but the firm did not deliver the same results.
For Firm 2, the distribution intensity is largely found in channel 2 with a higher markup relative to channel 1 and even to period zero's data. They doubled their production by 37.5% but was not able to sell all. It could be seen that they incurred expenses for R&D for product modifications. Product features were improved.Also they increased their advertising as seen in their increase of 16% in expense. It should be noted that Firms 1,2 and 2 did not invest in Marketing Research Reports. They only had very minimal expenses for such and they were not competitive in this manner because they were not able to connect with the consumers and they were not equipped with what the market needs and demands. They could have increased a feature in their product and still not entice the consumers. Additional promotions and commission expense was incurred. they concentrated in improving customer service and incurring an additional $27,500 outflow. Firm 2 and 3 applied the same strategies.
Lastly, Firm 4, the considered most successful implemented various strategies and optimized the changes. Product development is the root of the major edge and advantage of this firm against the 3 others. The values of product features were all improved. The highest average retail price of $ 279.70 for both channels was riveted by this firm.Unlike the previous year, they augmented the production by 5,000 units and still exceeded by 3,710 units leaving no inventories to be transferred. They incurred a net contribution.They had no remaining reserve funds though like the other 3 but increased their budget for the next period by 49.85%. More distribution intensity of sales for channel 1 was realized and that made up 80.4% of the total units sold. Competitive strategy of theirs was to focus on product development and market research. Promotions strategy wise, they diminished advertising expense and affected the pioneering type. Sales promotion bore more bearing this year and results prove its effectivity relative to distribution channel 1 which obviously they concentrated much on. The results of firm 4 was the positive reverse of firms 2 and 3 and definitely of firm1. The market segmentation is constant with their product positioning strategy .
From the perspective of Firm 2, competition might unfold in this industry and there is potential primarily because this period is considered a trial and error allowance for the firms who is deviating from their norms to explore the market. With this, there are major points and the first would relate to launching a new product. As period ended, only Firm 4 incurred net contribution. They all had the option to adapt a new product at the beginning but no one opted for such. In the coming of second