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Simulation Presentation
Team : NINDIA 6
Objective : Achieve 10% net profit for quarter 6
Team Details
15MDIM14 Apoorva Rastogi | 15MDIM15 Dhage Kunal Chandrakant |
15P030 Manas Ranjan Nayak |15P037 Parul Jain | 15P213 Mohit Sharma |
15P217 Pankaj Kumar Kaushal
Quarter 1
Rationale For the Decision
Percent Markup of Staples and Fashion was reduced to
increase the sales and get rid of the inventory of
Staples. Bulk purchases of big ticket was done to get
the advantage of discount of 10 %
Increase in the amount of Fashion items to counter the
decrease in percent markup to determine the effect of
price in this area
Increase in the number of employees to 12 and
advertising budget to 600 to push the products off the
Stapleswith lowFashion
Big Ticket
shelf accompanied
prices
Opening Stock
11134
5504
Gross
Purchase
15000
10000
20000
10000
25504
Demand at
Cost
8634
6002
24365
Quarter 1
Inferences
Market share of staples and fashion
increased due to decrease in
percent markups
Sales income decreased due to
decrease in big ticket purchases
due
to
competitors
adopting
aggressive strategy of low price
Operating expenses were decreased
due
to bulk purchases
Financial expenses were changed
insignificantly
due
to
steady
payable days
Market
Share
Staples
21
Fashion
18
Big Ticket 16
Quarter
1
Quarter
0
Sales
income
52918
57748
Gross
Profit
13917
16061
Operatin
g
Expense
s
11600
13000
Financial
expense
s
56
Net
1.7 %
3%
Quarter 2
Rationale For the Decision
Percent Markup in Staples and Fashion were increased
after witnessing the decrease in sales income in
previous quarter. Bit ticket sales get doubled in this
quarter hence the markup was reduced to give further
push to the sales
Due to clearance of inventory in staples, purchase of
staples was increased. Big ticket items were purchased
in bulk to avail discounts
Staff and advertising costs remained same
Staples
Fashion
Big Ticket
Opening Stock
1769
19502
Gross
Purchase
25000
7800
20000
7800
39502
Demand at
Cost
6231
22666
20062
Quarter 2
Inferences
Market
Share
Staples
15
Fashion
15
Big Ticket 18
Quarter
2
Quarter
1
Sales
income
68044
52918
Gross
Profit
19085
13917
Operatin
g
Expense
s
10330
11600
Financial
expense
s
158
56
Net
10.3 %
1.7 %
Quarter 3
Rationale For the Decision
Decrease in percent markup for staples due to poor
results of Q2 that lead to decrease in market share
because of price sensitivity
Percent Markup of fashion and big ticket remained
same to create stable perception about the quality of
products among customers
In order to avail the discounts bulk purchasing was
done on staples and big ticket was not purchased to
clear the inventory
Staples
Fashion
Big Ticket
Advertising expenses were increased
Opening Stock
6707
16836
Gross
Purchase
40000
7500
7500
16836
Demand at
Cost
7377
7375
29592
Quarter 3
Inferences
Able to capture the market share
of staples again by reducing the
prices
Market
Share
Staples
18
Fashion
17
Big Ticket 17
Quarter
3
Quarter
2
Sales
income
58816
68044
Gross
Profit
14472
19085
Operatin
g
Expense
s
11321
10330
Financial
expense
s
228
158
Net
4.8 %
10.3 %
Quarter 4
Rationale For the Decision
Adopted aggressive strategy of lowering the prices in
staples and big ticket
Bulk purchase of staples was done to clear off the
inventory till Q6 and to avail discounts. No purchase in
big ticket to clear off the inventory carried forward
from Q3
Sales staff was increased to push the products in the
field
Advertising expenses were increased to increase the
Staples
Fashion
Big Ticket
market share by creating awareness
Opening Stock
17115
9461
Gross
Purchase
60000
8500
8500
9461
Demand at
Cost
8223
9160
38262
Quarter 4
Inferences
Market
Share
Staples
20
Fashion
18
Big Ticket 17
Sales
income
increase
but
liquidity decreased due to bulk
purchases and shortage of cash
Financial
expenses
were
increased due to less liquidity
and more purchases
Quarter
4
Quarter
3
Sales
income
72665
58816
Gross
Profit
17020
14472
Operatin
g
Expense
s
12700
11321
Financial
expense
s
324
228
Net
5.1 %
4.8 %
Quarter 5
Rationale For the Decision
Markup of Fashion was increased
No purchases were done for staples to clear off the
inventory from Q4. Bulk purchases in big ticket due to
higher demand in this quarter
Sales staff and advertising expenses remained same
Staples
Fashion
Big Ticket
Opening Stock
38853
301
Gross
Purchase
8500
35000
8500
35301
Demand at
Cost
8454
11443
34920
Quarter 5
Inferences
Market
Share
Staples
15
Fashion
18
Big Ticket 20
Quarter
4
Quarter
4
Sales
income
72858
72665
Gross
Profit
18041
17020
Operatin
g
Expense
s
12200
12700
Financial
expense
s
57
324
Net
7.9 %
5.1 %
Quarter 6
Rationale For the Decision
Expectations
Key learnings
Thank You