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Marketing and Finance Strategy Insights

This document discusses various issues related to implementing strategies in marketing, finance/accounting, research and development (R&D), and management information systems (MIS). In marketing, it covers topics like market segmentation, product positioning, and the marketing mix. In finance/accounting, it discusses evaluating a business, projected financial statements, budgets, and an EPS-EBIT analysis example. For R&D, it lists three major approaches. Finally, it notes key functions of an MIS like information management and cost reduction.

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19 views18 pages

Marketing and Finance Strategy Insights

This document discusses various issues related to implementing strategies in marketing, finance/accounting, research and development (R&D), and management information systems (MIS). In marketing, it covers topics like market segmentation, product positioning, and the marketing mix. In finance/accounting, it discusses evaluating a business, projected financial statements, budgets, and an EPS-EBIT analysis example. For R&D, it lists three major approaches. Finally, it notes key functions of an MIS like information management and cost reduction.

Uploaded by

Icuwoot
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd

Chapter 8

Implementing Strategies: Marketing,


Finance/Accounting, R&D, & MIS Issues

Ch 8-1
Marketing Issues

Centrally important to Implementation

1. Market segmentation

2. Product positioning

Ch 8-2
Marketing Mix – Component Factors
Product Place Promotion Price

Distribution
Quality Advertising Level
channels
Distribution Discounts &
Features Personal selling
coverage allowances

Style Outlet location Sales promotion Payment terms

Brand name Sales territories Publicity

Inventory
Packaging
levels/locations
Transportation
Product line
carriers

Warranty

Service level

Ch 8-3
Marketing Issues

Geographic

Demographic

Market Segment
Basis Psychographic

Behavioral

Ch 8-4
Marketing Issues

Customer Wants

Product
Positioning

Customer Needs

Ch 8-5
Product Positioning Steps

1. Select Key Criteria

2. Diagram Map

Product 3. Plot competitors’


Positioning products
Steps
4. Look for niches

5. Develop Marketing
Plan
Ch 8-6
Product Positioning Map
High
Convenience Rental Car Market
•
Firm 1
Firm 2
•
High Low
Customer Customer
Loyalty Loyalty

•
Firm 3
Low
Convenience
Ch 8-7
EPS-EBIT Analysis
(in $millions)
Heinz Company – Year End 2001
 $Amount Needed: $500
 Stock Price $40
 EBIT Range $1000 to $2000
 Tax Rate 175/673 = .26 = 26%
 Interest Rate 5%
 # Shares Outstanding 350

Ch 8-8
EPS-EBIT Analysis (in $millions) – Heinz
Company
Stock Financing Financing Financing

High Low High Low High Low

EBIT ($982.4 in 2001) $2000 $1000 $2000 $1000 $2000 $1000

Interest (5%) 0 0 25 25 10 10

EBT 2000 1000 1975 975 1990 990

Taxes 26% 520 260 514 254 517 257

EAT 1480 740 1461 721 1473 733

# Shares outstanding 362.5 362.5 350 350 357.5 357.5

EPS 4.08 2.04 4.17 2.06 4.12 2.05

Ch 8-9
Finance/Accounting Issues

EPS-EBIT Analysis Heinz

 Conclusion:

 Heinz should use debt to raise the $500 million

Ch 8-10
Finance/Accounting Issues

Projected Financial Statements

 Allow an organization to examine the expected


results of various actions and approaches

Ch 8-11
Projected Income Statement for Litten Company (in millions)

Projected Year
  Prior Year 2004 2005 Remarks

Projected Income Statement  


Sales 100 150.00 50% increase
Cost of Goods Sold 70 105.00 70% of sales
Gross Margin 30 45.00  
Selling Expense 10 15.00 10% of sales
Administrative Expense 5 7.50 5% of sales
EBIT 15 22.50  
Interest 3 3.00  
EBT 12 19.50  
Taxes 6 9.75 50% rate
Net Income 6 9.75  
Dividends 2 5.00  
Retained Earnings 4 4.75  

Ch 8-12
Finance/Accounting Issues

Financial Budget

-- Details how funds will be obtained and spent for


a specified period of time.

Ch 8-13
Finance/Accounting Issues

Types of Budgets

 Cash budgets
 Operating budgets
 Sales budgets
 Profit budgets
 Factory Budgets
 Expense Budgets

Ch 8-14
Finance/Accounting Issues

Types of Budgets

 Divisional budgets
 Variable budgets
 Flexible budgets
 Fixed budgets

Ch 8-15
Finance/Accounting Issues

Evaluating Worth of a Business:


3 Basic Approaches

1. What a firm owns


2. What a firm earns
3. What a firm will bring in the market

Ch 8-16
Research & Development
Issues

3 Major R&D approaches to implementing


strategies

1. 1st firm to market new technological products


2. Innovative imitator of successful products
3. Low-cost producer of similar but less
expensive products

Ch 8-17
MIS Issues

Functions of MIS

 Information collection, retrieval, & storage


 Keeping managers informed
 Coordination of activities among divisions
 Allow firm to reduce costs

Ch 8-18

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