- AusCotton
The impacts of less-than-perfect demand forecasts for AusCotton products can affect the company will cause a fall equilibrium price. The impacts will be like
The low demand and high supply will cause a price fall of the product.
Auscotton will run through a loss in the business.
If there are low demand and high supply, the price of the product will fall.
The consumers will buy the products at a low price.
The company can be affected financially for its long run.
As the impact of low demand Auscotton can have the obstruction in expanding the business.
As the impact of low demand, it will affect the manufacturing strategy of Auscotton.
The future business of Auscotton will be affected by this fall of demand.
The volatility in the length and cost of transport services used to move its products from contract manufacturers to distribution centers will also affect the business of Auscotton. It will
It will cause a shortage of revenue for the business.
It will affect the income of the business.
The price of the product will rise.
Volatility in the length and cost of transport service will cause a rise in the price of the product.
To solve these low supply and high-cost problem, Auscotton can
Start in-store demonstration
Price reduction
Can cartel the manufacturing cost of the products.
Can cartel the cost of the wages.
Need to reduce the supply of the product.
Need to create artificial demand of the consumers.
Need to save cost for transportation.
Need to assume the main cost of the product.
- The improvement of Auscotton needs to be done in the matter of low demand and high transportation cost. Auscotton needs to follow a few steps to improve these problems. The levels are as follows-
- a) It is important to conduct the analysis of the internal need.
- b) Need to do the assessment of the market of the suppliers’.
- c) Auscotton needs to collect information about the suppliers.
- d) Auscotton needs to develop sourcing and outsourcing methods.
- e) The company needs to implement a sourcing strategy.
Auscotton needs to follow all these strategies to improve its business structure. It is important for Auscotton to look after the supply of the company. If the demand is low, and there is a high supply, the price of the product will fall. It will cause a fall in the revenue of the company. By using the said strategies, Auscotton can improve its position in the market. It can reduce the supply of the cloths and then the demand will meet the supply margin. If the demand and the supply meet together, the company will have a profit from the products.
- Respond to the assertion that some of the contract manufacturers are involved in producing illegal merchandise that ends up competing with the branded merchandise of AusCotton should be in strategically. The production of illegal merchandise should be taken care of.
The contract manufacturer needs to provide these-
Flexibility
Market access
Scalability
An offering of diverse Technology
Planning of business contingency.
Conclusion
It is concluded that the organization needs to maintain the demand and supply margin. The organization needs to be aware of the fact of any illegal activity in the market. The transportation cost is also a part to look after.