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I am a MBA Finance and B.E. Marine Engineering. I have acquired about 3 years work experience in the Shipping Industry as a Marine Engg and presently working in the Policy Department of Reliance Capital Consumer Finance Division since 1 year.

Friday 27 February 2009

Justification on "Building an Edge over others: A different Ball Game

1. The points raised in the article doesn't mean to subdue the utility theory rather drawing inference from the same and how is value related to customer and how he perceives the same and later trying to draw the same towards financial terms.

2. Thats true the businesses will fail if a profitable model for business is not there and if the chain is not efficient and the margins are not there, but the question in hand is not to analyze the profiability and correlate the same with value addition rather to look at all sections of the society and see what is the effect of such actions by the businesses on the same. i mean to say that i may sell a mobile to you at Rs 5000 whose actual value is say Rs 8000 , in net i have lost 3000 and you have gained 3000, this is an imbalance if we look the society as a whole...going into the governance issues and the social responsibility of the corporates towards society.(though i totally agree with the segment part of the concern in your review)
3. This is what the question in hand , what we say as growth today, is it actual growth, if it would have been actual then why there is so much disparity of the rich and the poor in Indian Economy, inflation a big factor which further widens the bridge between the two ...thats what the article wish to speak about..are the corporates looking just at the bottom line or have concerns for the economic efficiencey of operations and other responsibilities which these corporates have ....for eg i m a manufacturer of a bicycle. My total cost involved in making is say Rs 1000 and after the dealer, distributor and retailor the cycle goes to the customer at Rs 2700, the mark up in between the four people in the chain is at a compunded margin of around 28%. So my question is has the customer perceived that extra 1700 that has been paid by him. This is something which is questionable.

4.The mark up between the two prices is of the services that the people in the chain are giving ...but are these margins of say 28% justified, are they over inflated are they levelled..thats what the question in hand. The prices may be over inflated because of several reasons like the inefficient utilization of resources, ineffective manpower utilization, pilfrage, cost of holding inventory etc etc and thats what is counted for in the pricing.

The concerns which are raised in this article doesn't raise an eye towards the Marketing Segment or any dept of business , rather it tries to find out the inefficiencies in the system and minimise wastage , reduce prices and increase customer value.

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