order for the organization in this case to maximize profits earned, several
procedures should be followed keenly. Product differentiation. A company may
distinguish itself from the rest by provision of high quality products and
services to the clients. This may work in a situation where the buyers are not
price sensitive but mainly consider the quality of goods or services that are
readily available in the market. Controlling costs is a method that is very
reliable in minimizing losses likely to be incurred. When a company functions
under a low level of cost, it is flexible and can easily adapt to any decline
in prices thus remaining profitable.
If the cost is low, the profit
margin remains high. Low price strategy
may also be useful considering that whenever the demand for goods or services
is elastic the prices turn out to be low and the demand becomes stronger.
output produced should be in such a way that the marginal costs are equivalent
to marginal revenues in order to maximize the profits earned by Sony as an
organization dealing with the smartphones. However, the costs should be
minimized depending on the current profit margin. Low costs lead to increased
profits. However, the employees should be offered training sessions to improve
on their skills so that they may produce quality goods to attract new
addition, the level of technology enhanced should be cost effective. In case
there are intermediaries, there is need to hold negotiations with the vendors
to abolish any extra costs that may be incurred during the distribution
process. The employees with a deteriorating performance should be warned and
sacked if no changes are recorded from such individuals. Allocation of duties
is therefore important so that the employees’ performance can be evaluated.
should be eliminated. Furthermore, the workers should not perform their duties
during overtime to ensure that no extra costs are incurred. In some cases the
prices are increased and the waste products that are left behind after the
manufacturing process should totally be eliminated from the equation.