Product Costing

Introduction Production of goods and services involves the use of costs which are directly incurred in the production process and production overhead. Direct production costs comprise of labor, hours used in the production process, machining hours, and cost of raw material among others. Production overheads are the indirect costs incurred during a production process.Advertising We will write a custom report sample on Product Costing specifically for you for only $16.05 $11/page Learn More The production overheads arise from support services offered in the main department. Examples are canteen cost, service bay costs, administration expenses, sales and marketing, and rent among others. The units of output produced should be charged with the total cost of production incurred. There are various approaches that can be used to charge the production costs to units of output produced. The most common approaches are arbitrage costing, absorption costing and marg inal costing (Vanderbeck 2008). This treatise carries out a comprehensive review of absorption costing. It explains the approach, its strengths and weaknesses and finally gives recommendations to the Welsh Government on continuation of the use of the method in the public sector. Absorption costing and key assumptions Generally, absorption costing traces both the fixed and variable costs of production of the product. In using this approach, a share of the fixed cost of production is allocated to each product. This share is added together with the direct cost of production for each individual product to obtain the total or the full cost of producing a unit of output. The fixed costs are assigned using the overhead absorption rates. Absorption costing goes through three key distinct stages these are allocation, apportionment and absorption. There are various types of absorption costing. These are job order costing, process costing and ABC costing. Under job order costing, the cost of p roduction is assigned to products in lots or batches. It is suitable for production processes where goods are produced in lots such as printing and manufacturing of furniture among others. Under process costing, the cost of production is methodically allocated to the product. Example is the production of soft drinks or oil. Finally, ABC costing is suitable for a firm which produces a number of products with varying volumes. The ultimate aim of absorption costing is to include in the total cost of a product an appropriate share of the company’s total overhead (Tulsian 2007). An appropriate share denotes the average of the amount of time and effort used in producing a unit of output. One key assumption of the absorption costing approach is that it suppose that consumers and producers are insensitive to price of the product thus pricing of the firm does not affect the decision to purchase. Consumers will purchase the commodities produced at the quoted price. This violates the la w of demand and it’s unrealistic because in a competitive market, consumer and producers are sensitive to changes in price (Jawahar-Lal 2009).Advertising Looking for report on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More Absorption costing as a means of cost control As mentioned above, absorption costing assign the direct cost of production and production overheads to the cost centers. Therefore, all cost incurred in an organization is accounted for. Assigning of production overhead to each cost center makes managers more accountable and responsible for managing costs in their departments. Besides, they have to operate within the budgets provided since variations from the budgeted values affect the absorption rates used in allocating the cost. Therefore, absorption costing makes management be more sensitive to spending in their departments (Jawahar-Lal 2009). Strengths and weaknesses of absorption costing for ma nagement Just like any other process, absorption costing has a number of strengths and weaknesses. One key advantage is that it makes use of fixed cost of production when computing the cost per unit of output. Therefore, the management is able to view the total cost associated with producing a product. Secondly, the method is consistent with the Generally Accepted Accounting Principles therefore, the results of absorption costing helps the management to prepare the financial reports. Absorption costing helps management in the valuation of stock. The International Accounting Standards (IAS) require that inventory should be valued either at the lower of the costs of the net realizable value. Further, absorption costing is consistent with the accrual and matching concept of accounting. These principles require matching of costs to revenue in a given accounting period. Absorption costing necessitates this. Results of absorption costing provides the costs required to bring the goods to i ts useable state. Therefore, once cost is estimated the management will be able to estimate the price of the goods. Absorption costing helps in estimating the total costs incurred in bringing the goods to its use value. Further, results of absorption costing helps in pricing of goods and services. It is because, most management estimates the prices as a mark up of the costs. The difference between these costs and prices yields profits to the management. Use of absorption costing helps in estimating profit arising from the production of a unit of output. The results of absorption costing does not depend on fluctuation in sales. That is, the results are the same during off peak and peak season. This helps management maintain a consistent cost schedule throughout the year. Further, absorption costing evades the separation of fixed and variable costs as in the case of variable costing. Finally, the allocation of production overheads to cost centers helps management to control, be inform ed and in charge of services offered to another department in a company (Drury 2008).Advertising We will write a custom report sample on Product Costing specifically for you for only $16.05 $11/page Learn More A major drawback of this approach is that it does not give accurate results. It is for the reason that allocation, apportionment and absorption of costs using this approach is based on budgeted values. These values are arrived at after taking into account operations of the previous years and future plans of the company. However, business environment does change. Therefore, there is a tendency that the budgeted values would not be exactly the same as the actual values. This causes variance which calls for adjustments at year end. Further, absorption costing ignores cost volume profit relationship. This relationship is quite significant in decision making. Management has to seek other methods which can be useful in decision making such as marginal c osting technique (Debarshi 2011) Recommendation to Welsh Government Public sector commonly provides goods and services to the citizens. Most of the public sectors do not directly deal with production of goods or rather are not in the manufacturing sector. It is worth noting that absorption costing is commonly used in the manufacturing sector. However, public sector and other institutions offering services are using the same idea in estimating costs of services. For instance, in a learning government institution, the costing process entails identifying the resources available in the institution (such as number of employees and assets), identifying the products (such as courses, research papers), identifying the activities (such as library, admission and course activities), assign the resources costs to the activities, link the activities to the products using cost drivers (such as staff, students and space), and finally make a report on the cost per product (Caplan 2012). Therefore, it is evident that the public sector uses the idea of absorption costing in their pricing decisions. The method is very appropriate for the public sector since it shows the full costs of offering the goods and services to the public. This element is of utmost significance in the public sector because in most cases, government the government is majorly concerned with the cost of provision of the public goods and not the profits that arise from the provision of such goods. Therefore, a method costing that would provide the full cost of a provide is much important. The full cost of goods and services enables the government to provide adequate funding for the production or provision of the goods and services. The Welsh Government should continue with the use of absorption costing in the public sector organization. This approach facilitates preparation the government budget (Rajasekaran Lalitha 2011). A brief presentation on absorption costing outlining the key points In conclusion, abs orption costing is a way of assigning the direct cost of production and overheads to the unit of output produced. The method provides a full cost of the product which is very essential in budgeting. The method assigns costs of production to the units of output produced using three steps these are allocating, apportionment of the costs and absorption of costs.Advertising Looking for report on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More There are various ways of assigning costs using absorption costing, this depends on the output produced. One key assumption that is implied in the computation of the unit cost of a product is that the consumers and producers are price insensitive that is, they purchase the goods at the prices offered. This assumption is of less significance to the public sector since their main intention is the provision of goods and services and not profit making. The method would be beneficial to the Welph Government in a number of ways. First, it will enable the government to have the full cost of provision of goods and services to the public. The information is significant in the preparation of the government annual budget. Secondly, the method is consistent with the government reporting framework. Therefore, there will be no inconsistencies or need for adjustments when using the approach. Finally, the method helps various heads of the public sector to manage the costs in their respective instit utions. It is because they will be allocated funds as per the budget. The method has a number of weaknesses. First, it is not accurate since it uses budgets. These are estimates which arise from previous budgets and future plans. The government of Welph should consider using the approach in the public institutions. Apart from the use of absorption costing method, the government can also consider using other methods of allocating costs such as direct method, reciprocal approach and step down method. The government can also use marginal costing among others. Therefore, the Welph government should choose the most appropriate method of allocating cost depending on the nature of the services provided by each sector and the aim of the government. References Debarshi, B 2011, Management accounting, Dorling Kindersley Pvt. Ltd., South Asia. Caplan D 2012, Product costing and cost allocation. Web. Drury, C 2008, Management and cost accounting, South Western Cengage Learning, Canada. Jawahar- Lal, A 2009, Cost accounting, McGraw-Hill Company Limited, New Delhi. Rajasekaran, V Lalitha, R 2011, Cost accounting, Dorling Kindersley Pvt. Ltd., South Asia. Tulsian, P 2007, Cost accounting, McGraw-Hill Publishing Company Limited, New Delhi. Vanderbeck, E 2008, Principles of cost accounting, Thomson Learning, Inc., Canada. This report on Product Costing was written and submitted by user Mohamed M. to help you with your own studies. You are free to use it for research and reference purposes in order to write your own paper; however, you must cite it accordingly. You can donate your paper here.

Free Essays on Virtual Reality

Introduction Close your eyes and imagine yourself being able to jump off the Empire State Building and fly over New York City on your own personal tour. You catch a glimpse of Madison Square Garden and a breathtaking view of Broadway. Jump back a few hundred years into the medieval times and joust with a knight. One last visualization- you are playing baseball in Busch Stadium on the same team as Mark McGuire. The crowd is wild. You soak up the glory as you realize they are cheering for you! Now stop fantasizing. These things will probably never happen to you in real life. However, there is a way that you can experience the feeling that something like this is happening. If you’re open to new ideas and you have a good imagination, virtual reality maybe a toy for you! What exactly is virtual reality? Well, virtual reality can be defined as any medium where one feels a sense of â€Å"immersion† and â€Å"presence† in the environment generated or descri bed. This means that if your imagination is wild enough, watching any television show or reading a book can be virtual reality. I will define virtual reality as a highly interactive, computer-generated environment. Graphics-based virtual reality allows one to break the 2-Dimensional constraints of today’s familiar equipment and has many practical applications. Four of these applications are medical, space exploration and training, physical, and entertainment. Body Medical researchers have been using virtual reality techniques to synthesize diagnostic images of a patient’s body to do predictive modeling of radiation treatment using images created by ultrasound, magnetic resonance imaging (MRI), and X-ray. A radiation therapist in a virtual world could view and expose a tumor at any angle and then model specific doses and configuration of radiation beams to aim at the tumor more effectively. Since radiation destroys human tissue easily, there is n... Free Essays on Virtual Reality Free Essays on Virtual Reality Virtual Reality - What it is and How it Works Imagine being able to point into the sky and fly. Or perhaps walk through space and connect molecules together. These are some of the dreams that have come with the invention of virtual reality. With the introduction of computers, numerous applications have been enhanced or created. The newest technology that is being tapped is that of artificial reality, or "virtual reality" (VR). When Morton Heilig first got a patent for his "Sensorama Simulator" in 1962, he had no idea that 30 years later people would still be trying to simulate reality and that they would be doing it so effectively. Jaron Lanier first coined the phrase "virtual reality" around 1989, and it has stuck ever since. Unfortunately, this catchy name has caused people to dream up incredible uses for this technology including using it as a sort of drug. This became evident when, among other people, Timothy Leary became interested in VR. This has also worried some of the researchers who are trying to create very real appli cations for medical, space, physical, chemical, and entertainment uses among other things. In order to create this alternate reality, however, you need to find ways to create the illusion of reality with a piece of machinery known as the computer. This is done with several computer-user interfaces used to simulate the senses. Among these, are stereoscopic glasses to make the simulated world look real, a 3D auditory display to give depth to sound, sensor lined gloves to simulate tactile feedback, and head-trackers to follow the orientation of the head. Since the technology is fairly young, these interfaces have not been perfected, making for a somewhat cartoonish simulated reality. Stereoscopic vision is probably the most important feature of VR because in real life, people rely mainly on vision to get places and do things. The eyes are approximately 6.5 centimeters apart, and allow you to have a full-colour, thr... Free Essays on Virtual Reality Virtual Reality is considered one of the most exciting technologies today, constantly evolving and improving. According to Eric Drexler, a world known pioneer in this field, VR is "A combination of computer and interface devices (goggles, gloves, etc.) that present a user with the illusion of being in a three dimensional world of computer generated objects." The term ^virtual reality,^ is not finite in its meaning, but generally includes desktop VR, immersion VR, where the goggles and gloves are used, and projection VR. The virtual reality technology is not yet perfect and still too expensive for the common man. The use of high-end VR is mainly restricted to larger companies, and to special areas such as medical surgery and pilot training. Home users are limited to desktop virtual reality programs, which lets them navigate in three-dimensional worlds, but seldom gives the feeling of actually being there. The entertainment industry has yet to embrace the technol! ogy in full scale, but in his book ^Virtual Reality^ Howard Rheingold states ^Used today in architecture, engineering and design, tomorrow in mass-market entertainment, surrogate travel, virtual surgery and cybersex, by the next century ^VR^ will have transformed our lives.^ Will VR cause people to lose their grip on the real world, or is it just a continuation of previous developments that took people to imaginary places? People seem to always have escaped to ^imaginary worlds^, to get a way from the stress of real life and to relax. We have all experienced Greek theatre, read novels and been to the cinema, and lived ourselves into fiction stories that we identify with. Our imagination creates a fiction world, which leads us away from real life for a moment of time. In our own utopia, we forget contemporary problems of reality. Even though the virtual reality technology creates a utopia for us to explore, it is in a lot of ways different from other developments we know so well... Free Essays on Virtual Reality TABLE OF CONTENTS INTRODUCTION 3 WHAT IS VIRTUAL REALITY? 4 HOW DOES VIRTUAL REALITY WORK? 5 v The Three Levels of VR : 5 THE HISTORY OF VIRTUAL REALITY 7 VIRTUAL REALITY IN THE PRESENT 8 VIRTUAL REALITY IN THE FUTURE 9 THE TECHNOLOGY BEHIND VIRTUAL REALITY 9 v Video Display Devices: 10 v Audio Output Devices: 10 v Tactile Response Devices: 11 v Interactive Input Devices: 11 v Computers and Software: 12 IMMERSIVE & NON IMMERSIVE VR 12 v The Cave: 13 v Head-Mounted Display (HMD): 13 v The Boom: 14 v Input Devices and other Sensual Technologies: 14 v Shared Virtual Environments: 15 v VRML: 15 DRAWBACKS OF VR 16 THE SOCIAL IMPLICATIONS OF VIRTUAL REALITY 17 v The New Rules of Behavior: 17 v Adverse Effects: 17 Applications of VR 18 v A List of Existing VR examples: 18 DETAILED APPLICATIONS OF VR: 19 v Architecture: 19 v Visualization: 21 v Entertainment: 21 v VR in Movies: 22 v Manufacturing: 25 v Augmented Reality: 25 v Education & Training: 26 v Medical: 27 SUMMARY 27 CONCLUSION 28 BIBLIOGRAPHY 28 INTRODUCTION Throughout the many stages of media Virtual Reality (VR) has helped us to extend our perception, imagination and manipulation. VR is just an extra step on the long road, bringing the imagination as close and realistic as reality itself. After the first experiments in the fifties with complex kinesthetic devices like multiple cameras, senso-motoric devices and even smell generators, more elegant head-mounted devices were developed in the early nineties. Both defense research and the computer games industry were the main stimulators of VR. VR is everything and it is hard to describe what VR is not: It encapsulates all previous media, even books, slides, pictures, audio, video and multimedia. The typical contribution of VR is its effect of ‘immersion’; the user feels as if (s)he is in a different world. Both the sensations and the actions of the user should resemble as much a... Free Essays on Virtual Reality Introduction Close your eyes and imagine yourself being able to jump off the Empire State Building and fly over New York City on your own personal tour. You catch a glimpse of Madison Square Garden and a breathtaking view of Broadway. Jump back a few hundred years into the medieval times and joust with a knight. One last visualization- you are playing baseball in Busch Stadium on the same team as Mark McGuire. The crowd is wild. You soak up the glory as you realize they are cheering for you! Now stop fantasizing. These things will probably never happen to you in real life. However, there is a way that you can experience the feeling that something like this is happening. If you’re open to new ideas and you have a good imagination, virtual reality maybe a toy for you! What exactly is virtual reality? Well, virtual reality can be defined as any medium where one feels a sense of â€Å"immersion† and â€Å"presence† in the environment generated or descri bed. This means that if your imagination is wild enough, watching any television show or reading a book can be virtual reality. I will define virtual reality as a highly interactive, computer-generated environment. Graphics-based virtual reality allows one to break the 2-Dimensional constraints of today’s familiar equipment and has many practical applications. Four of these applications are medical, space exploration and training, physical, and entertainment. Body Medical researchers have been using virtual reality techniques to synthesize diagnostic images of a patient’s body to do predictive modeling of radiation treatment using images created by ultrasound, magnetic resonance imaging (MRI), and X-ray. A radiation therapist in a virtual world could view and expose a tumor at any angle and then model specific doses and configuration of radiation beams to aim at the tumor more effectively. Since radiation destroys human tissue easily, there is n... Free Essays on Virtual Reality The VR Centre for the Built Environment, a winner of an Office of Science & Technology Foresight Challenge Award, was established in June 1997 at University College London and Imperial College London. This is an interdisciplinary initiative involving the Bartlett, Centre for Advanced Spatial Analysis, Centre for Transport Studies and the Departments of Computer Science, Geography and Geomatic Engineering at UCL and IC-Parc at Imperial College along with a consortium of 16 industrial partners. It aims to research, develop and disseminate ways of designing, producing and operating buildings and urban areas using virtual reality techniques. The VR Centre's role is to bring the full range of computer graphics, interaction and digital data to the virtual building that currently drives the design-development-operation cycle. Information, analysis and simulations are being synthesised to allow design teams and their clients to predict the performance of proposals at both the urban and building scale. Virtual models are being developed to capture information on performance during the operational life of the building so that this can be fed back into future projects. The Centre is focusing on three key generic technologies: Technologies to help clients and end users understand the consequences of decisions; Technologies to allow better visualisation and interaction with design proposals; Technologies to capture information about the operation of the built environment and to feed that information back into the design, construction and operation process.... Free Essays on Virtual Reality Virtual Reality Virtual reality (VR) is the use of a computer to create an artificial environment that appears and feels like a real environment and allows users to explore a space and manipulate the environment. In its simplest form, a VR application displays what appears to be a three- dimentional view of a place or object, such as landscape, building, molecules, or red blood cell, which users can explore. For example, architects can use VR software to show clients how a building will look after a construction or remodeling project. In more advanced forms, VR software requires that users wear specialized headgear, body suits, and gloves to enhance the experience of the artificial environment (Vance and Reed 34-58). The headgear displays the artificial environment in front of a users eyes. The body suit and the gloves sense motion and direction, allowing a user to move through, pick up, or hold items displayed in the virtual environment. Experts predict that eventually the body suits will provide tactile feedback so users can experience the touch and feel of the virtual world. Many games, such as flight simulators, use virtual reality. In these games special visors allow users to see the computer-generated environment. As the user walks around the game's electronic landscape, sensors in the surrounding game machine record movements and change the view of the landscape accordingly. Companies increasingly are using VR for more practical commercial applications, as well. Automobile dealers, for example, use virtual showrooms in which customers can view the exterior and interior of available vehicles. Airplane manufacturers use virtual prototypes to test new models and shorten product design time. Many firms use personal computer-based VR applications for employee training (Shelly Cashman Series ®Microsoft Word 2000 Project 2). As computing power and the use of ...

Research in accounting and fiannce Essay Example | Topics and Well Written Essays - 1000 words

Research in accounting and fiannce - Essay Example There is no massive fluctuation in the share prices, but in the year 2009 it was least among the five years which shows little financial decline in the company’s performance. In the year 2012 the stock prices were highest among the five years which showed an increase in the financial performance of the company. There are many internal and external factors that affect the performance of an organization in both positive and negative way. The external forces that may affect the financial performance of Sainsbury are: Political force: The political forces residing in Europe and which may have an effect on the performance of Sainsbury are Euro Zone, European Union, rapidly globalizing businesses and many taxation rules policies. Economic factor: These factors can be rapidly changing interest rates, exchange rates, GDP of a country and Per capita Income, inflation, Job market and unemployment rate and company’s market share which may affect a company’s performance. Technological forces: Technological forces have great influences on the performance of any organization. This includes invention of new and modern products, innovation in products and improvements, etc. When the financial crisis of 2009-2010 hit the industry, it had no such disastrous influence on the financial condition of Sainsbury. In a report by Mr. Justin King it is said that the when the crisis hit the industry people changed their spending pattern but the sales of Sainsbury when revealed, it was observed that it was more than the forecasted sales (Hall, 2010). When the euro zone sovereign debt crisis hit London the share price of Sainsbury decreased along with many other companies. As reported on 21 may 2012, the stock price of many companies emerged from the crisis but Sainsbury and Tesco were still among the weakest performers (London midday: Stocks rise but Eurozone still in focus, 2012). There are many resources and abilities within an organizations,

NutritionTracking patients with nutritional risks, how does your Essay

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Proposed Market Entry Strategy Essay Example for Free

Proposed Market Entry Strategy Essay 1. Executive Summary The use of air conditioning is widespread since it does not only provide appropriate room temperature for electrical equipments that make internet and telecommunication works but also provide comfortable atmosphere for cooling rooms in a houses, trade centers, office buildings and many others. The situation reveals that air conditioning equipments have vital roles in society. However, the use of air conditioning devices is associated with high costs since they consume large power of electrical current. Under such circumstances, the development of efficient cooling and purifying devices become the next stage in the air cooling and purifying development. One of air purifying and cooling products available in the market is EnerVent ®, which developed by Northridge Enterprise. The company understands that to win customers’ hearts, there are four key features that EnerVent ® should possess; they are true Fresh air delivery, low costs and low heating air conditioning in compact design, high quality of air purifiers that are not merely circulating the same air in a room, and capability to eliminate harmful gases, mold, and germs. Concerning the issue, this paper has elaborated several issues concerning the market entry strategy for EnerVent ® including target markets, market potential, competitive market analysis, marketing objectives, marketing mix strategy (product, place, promotion, and place) 2. Introduction 2.1. Development of Air Conditioning and Purifying Products Nowadays, the discussion over the benefits of the sophisticated information technology including computers and telecommunications on business and communication is an endless topic in seminars or exhibitions. However, in order to work properly, such equipments need low-temperature in order to prevent overheating so that the use of high-power air conditioning is vast in the equipment rooms. In addition to the use of air conditioning devices for cooling rooms, they also provide comfortable atmosphere for cooling rooms in a houses, trade centers, office buildings and many others. The situation reveals that air conditioning equipments have vital roles in society. This makes sense since the use of air conditioning is widespread and easily found in almost every place that provide comfortable atmosphere. According to ARI CoolNet, air conditioning has several functional benefits as following: ï‚ § Providing personal comfort ï‚ § Improving productivity in the workplace where it relates to the comfortable place the air conditioning provides ï‚ § Increasing good medical and health services ï‚ § Helping vendors to preserve fresh and frozen foods like seafood, frozen potatoes, sausage an many others ï‚ § Protecting electrical equipment from excessive heating Since the use of air conditioning, previously called as manufactured air, is vital in day-to-day activities, it becomes a significant invention in human history. However, recent air conditioning or ventilation products do not end in the development of fancy casing or cooler temperature but also in several values added features. For example, the invention of Plasma cluster technology, which is capable of killing 99-percent bacterium and viruses including Aviation flue viruses, becomes the Sharps’ competitive advantage that generate revenue for the Japanese company’s air conditioning and cooling products including refrigerators, chillers, air conditioner, air purifiers, to name a few. However, the use of air conditioning products is associated with high costs since they consume large power of electrical current. Under such circumstances, the development of efficient cooling and purifying devices become the next stage in the air cooling and purifying development. 2.2. EnerVent ® Products EnerVent ® is manufactured to fulfill the need for efficient ventilation system that has several features including compact design (small) and lightweight compared to existing whole house and individual room air conditioning system. The EnerVent ® has favorable tagline that clearly target particular customers as following: There is nothing like fresh air from open windows on a Spring day. Yet high heating and air conditioning costs keep homes sealed tight to save money. Harmful odors, gases, mold, and germs stay in. Even quality air purifiers can only clean and circulate the same air. The EnerVent ® system offers the best of both worlds, bringing in and circulating out up to 12 true air exchanges daily without a significant energy penalty† The EnerVent ® jargon suggests that there are four features that the company concerns when developing EnerVent ®; they are Fresh air delivery, low costs and low heating air conditioning in compact design, high quality of air purifiers that are not merely circulating the same air in a room, and capability to eliminate harmful gases, mold, and germs. Concerning the size, Figure 1 shows example of several air conditioning designs that appear to be ‘usual’, large, and ‘compact’ design. (a) GMG (b) Delonghi Figure 1 Several Design of Existing Air Conditioning System Source: OK CHINA INDUSTRIAL LTD, 2007 In addition to size, competition in air conditioning system evolves into the provision of fresh air that circulate the true fresh air from the outside instead circulating the same air. This feature is significantly important since people have great concerns over the raising pollution because of industrial plants discard smoke, the forest fire, bad air-refreshing systems in a house, etc. Generally, air pollution in the U.S., to be precise, and other industrial countries is because acid rain in both the U.S. and Canada in which the US becomes a country that emits a large amount of carbon dioxide as the result of fossil fuels burning; limited resources of natural fresh water, water pollution due to pesticides and fertilizers (â€Å"Air pollution from other countries drifts into USA†, 2005). Concerning the capability of eliminating odor, EnerVent ® also present attractive features since the product is capable of eliminating harmful odors, gases, mold, and germs. In the market, this feature is best represented by Sharp’s Plasma cluster product as shown in the Figure 2. (a) Sharp FU40SEK (b) Sharp FU-S40TA Figure 2 Sharp Air Purifier with Plasma cluster technology Source: Callde, 2007; Pantipmarket, 2007 3. Target Markets Since EnerVent ® has particular characteristics that present the â€Å"true† fresh air to either â€Å"whole houses† and â€Å"individual room†, therefore, the target market for EnerVent ® is as following: ï‚ § Brand of Products : True fresh air like one from open windows on a Spring day Eliminate harmful odors, gases, mold, and germs stay in Low energy consumption ï‚ § Customers’ Preferences : People who concern about the need for fresh air in a room that has capability to eliminate harmful materials at low operation costs ï‚ § Ages : above 25 (this is the age where people use their rational reasons when buying a product). This is important since home electronic industry are fulfilled with advertising that trick customers ï‚ § Income Levels : above $2,500 per month (considering that the price of air Purifying is above $100, see Figure 3) Figure 3 Air Purifier Source: Bizrate, 2007 4. Market Potential and Sales Forecast The market potential for air purifiers from EnerVent ® is people who concerns about the People who concern about the need for fresh air in a room that has capability to eliminate harmful materials at low operation costs. The description suggests that EnerVent ® target both high-end customers since they are more concern about complete features regardless the price and low-end customers since they concern about low-operational costs despite high ownership costs. For high end customers, they realize that air pollution is more influencing the children than adult. All of U.S. researchers open their study about finding the polluted air impact at the children. It is believed that air pollution make the children lung become smaller. This evidence assures that air pollution own the chronic impact. In addition, this impact will be permanent at all of the children until they become adult (â€Å"Air Pollution Might Affect Lung Development in Children, Study Finds†, 2004). Bad air quality give the negative impact to the environmental quality and the financial loss because of the air pollution is not small. Because financially, air pollution will improve the cost, which must be become the responsibility of society. It can be in the form of medical expense for pain suffered, decreasing of the work productivity as an effect of air pollution, and decreasing of the prosperity life. Due to the fact that air pollution may provide unfavorable condition for an entire family; therefore, Northridge Enterprise has wide market potential to sell EnerVent ®, the true air purifier. To be specific the market potential for EnerVent ® is as following: 4.1. Middle and High Class market, Offices and Buildings There are many considerations in the minds of consumers when they are buying air conditioning product. In most parts of the world, air conditioning is the consumption of middle and high-class families, buildings and offices. For these people, cost is not the prime factor of consideration. It is quality that concerns them the most. In the light of this consideration, the Enervent will only gain small portion of the market in this segment because there are many air conditioning products which have better features and higher capacity to regulate air in larger offices. The Enervent on the other hand, can only regulate air in a limited space because it does not have the capability of producing cool air as a regular air conditioning machine. There are however, mid and high class households and small offices that prefer to use air purifier because they like the natural atmosphere of their houses and offices. These are generally smaller establishments or places which have plenty, but small to medium-sized rooms. This represents an opportunity for Enervent to enter the medium and high class households, buildings and offices. The opportunity however, is very small compare to the entire market of air conditioning equipment in the medium and high class market. 4.2. Medium and Lower Income Families Air conditioning needs are not the sole demands of medium and high-class establishments. In the modern realm where people’s desire for quality has been considerably enhanced, the need for air conditioning spreads to the low income families and offices. This represents a better opportunity for Enervent to gain larger portion of the market. This is true because for low income families and low-budget offices, the cost of having a full fledged air conditioning system can be quite overwhelming. In previous times, they generally switch to air purifier products because they are cheaper and do not consume too much electricity. However, the presence of the Enervent creates new and better alternative. These people could gain better quality than average air purifiers and pay cheaper costs than the average air conditioner products (Ward, 2007). 4.3. The market for Air Regulator Machines The rapid development of economy in various regions of the world generated massive demands for air conditioning products. In some markets, the air conditioning products are displaying a rapid increase, like the Indian market and Saudi Arabian. They are potential markets because of their geographic conditions and their economic development. On the other hand, there are also markets that displayed declining tendencies in the air conditioning market development because of the over-crowded markets, like China. In Europe, United States and most of the Asian countries displayed stable or otherwise mild development in the air conditioning market (Wind of Change, 2006). The product is, on the other hand, a revolutionary product filling a niche between the high cost air conditioning equipment and the simple air purifier machine. In a sense it has similar but different markets than those of the air conditioner products. Because of the revolutionary nature of the industry, and the contributions from low income, middle and high class markets elaborated above, I believe that the product will take over approximately 5-10% of the air conditioning market in the end of the first year. Furthermore, being the sole producer of Enervent, then the sales number of the company will be similar to that percentage. For instance, if the US air conditioning market is worth US$ 1 billion annually, then Enervent will generate a sales number of US$ 50-100 million. 5. Competitive Market Analysis The air conditioning industry is a global industry. Most of the modern countries plus several of the developing countries witnessed rapid growth of their air national air conditioning industry. In Saudi Arabia for example, demands for air conditioners is the highest in the world. Analysts have stated that the Saudi Arabian market has become a unique investment opportunities for foreign investors. Although not exactly alike, similar rate of growth can be witnessed in India and other developing countries (Saudi Aircon, 2007). Despite the rapid growth of the industry, Enervent cannot expect to gain the full benefit of the market development. The direct competitor of Enervent is air conditioning itself. Despite their significantly higher prices, they have larger capacity of regulating temperature and the condition of large rooms. Modern air conditioning is also equipped with various features that do not exist in Enervent, like self cleaning device, etc. Furthermore, air conditioning has a better and more widespread reputation that Enervent, which is a new and unpopular product. The competitive advantages of Enervent against the direct competitor are price and efficiency. The product is considerably cheaper, lighter and more far more electricity efficient than the average air conditioning machine. Indirect competitor of Enervent is the cheaper and simpler air purifier. The low cost and electricity efficient device is also quite popular as alternative of air conditioners. They generate significantly less cost than the average air conditioner, but cannot act as a temperature regulator. Many considered that the air purifier and the air conditioner market is not the same. Nevertheless, they are the same. Air purifier is an indirect competitor of both the air conditioner market and Enervent. Enervent has the advantage of temperature control with similarly low cost and efficient electricity compare to the air purifier. In addition to the analysis above, there are also other factors in the air conditioner industry that generates opportunities for Enervent to grow, they are: †¢ The emerging new styles of offices In the modern world, people are not satisfied having the same offices as other companies. In order to facilitate such a need for creative office design. The trend toward more stylish offices generates more complicated buildings with less ventilation. Pursuing efficiency, more employees are stationed in smaller rooms. These conditions generated the need for larger capacities of air conditioning. This is logical because managers have realized that poor air quality in the workplace could result in lack of productivity and worse, sickness (Cunningham, 1986). The necessity for more air conditioning system generates more demands of air conditioning machines. However, because companies are constantly searching for ways to enhance efficiency, their attention turn toward products which can deliver similar performance in air conditioning with less prices and more electricity efficient performance. This leads to opportunities for the newly designed Enervent, an air conditioning machine which are significantly cheaper and much more electricity efficient (Piercy, 1982). †¢ New Competitors The highly competitive environment is created by various factors. For one, the amount of players within the industry also plays a great role in shaping the competitive atmosphere. In the air conditioning market, Far Eastern manufacturers have improved their manufacturing capabilities by cooperating with Japanese producers. The new entrants are expected to influence the European market aggressively by means of targeting an established distributor. These new entrants have significantly lower price structures, thus allowing them to deliver cheaper prices to consumers. This leads to harder and more competitive atmosphere in the industry of both air conditioning machines and air purifier machines. In a sense, this also influences Enerven as an alternative between the two products. 6. Marketing Objectives The hardest mission of a marketer in getting the product accepted and recognized within the local environment. The Enervent is a new product with revolutionary technology. Its first year in the market should be the year of promotion and market penetration. Therefore the marketing objectives should be: †¢ Establish presence in local environment There are various factors that could influence how a product will result revenues and profits within its market. Each local environment has different preferences of how products should be. It is important for Enervent to win the hearts of local society by collaborating with local culture and traditions. The failure to achieve that will create poor and undeveloped sales performance. Thus, one of the most important and early marketing objective should be how to generate connection with local markets (Korey, 1986). †¢ Discover new channel of distributions and marketing In the first year of marketing, new products should be brought throughout the markets using various channels and means of transportations. Getting to know the local infrastructure and how will it affect the business is very much important. Thus, discovering new channel of promotion and distribution is also an important objective (Koney, 1986) †¢ Create a distinction Establishing presence and discovering new channels are usually not enough to get the product running and generate revenues and profits. The product needs features or appearance that will differentiate it from other products. This activity is called brand designing (Keegan, 1989). 7. Marketing Mix In the following chapter I will use existing information to make an assessment of how Enervent should be sold. This assessment is important because it determines the shape of the business offering toward consumers. Re-designing the business offerings has been the core purpose of performing a marketing mix analysis. In terms of Enervent, the following is suggested: 7.1. Product Positioning Strategy Enervent should be well promoted to reflect capabilities of the new and revolutionary product. As implied in previous chapters, the product should be advertised as a brilliant alternative to air conditioning and air purifier. It is the combination of both worlds which brings the best of them. The product can also be advertised as the new revolution in air conditioning. The advertising campaign would have to generate the image that Enervent is the next generation of low cost, low energy air conditioning (Keegan, 1989). As mentioned in previous chapter, the product has different opportunities in different segments of the market. Therefore, there is a need to perform different emphasize on different segments of the market. In the medium to high-class households, buildings and offices, the company should focus on promoting the product as a smart replacement of the average air conditioning system because of its air temperature management capabilities and its low cost and energy efficient nature. This would attract those customers which prefer to maintain the naturality of their environments as mentioned before. On the other hand, in the low-income households and offices, the product should be promoted as the new generation of air conditioning. The product should be promoted as the new and brilliant evolution toward environmental friendliness and quality preservation. Because the company is forecasted to generate more sales in this segment, this characteristic of product positioning (as a revolutionary new generation of air conditioning) should be the main scenario of marketing. Other processes within the product positioning activities which require attention includes: paying attention to manufacturing specifications, labeling and packaging to represent the target market we are aiming and the position of our product. The product must also be tested first before it enters the market. Analysts also suggested that the product should be matched with its surrounding environment, whether in times of sale or distribution. For instance, products that travel through the road should contain different specifications and equipments to products that travel through air (Keegan, 1989). 7.2. Pricing Strategy In marketing mix, price is considered as one of the factor that contributes to the total value of product offering. Despite the high quality of the product, if the pricing strategy does no reflect value (which means the value gained from the purchase is greater than the value of money sacrificed for the purchase), then customers would not be appealed to the product. Price has been the most important consideration in buying air conditioner machines for years. Because of the highly advanced technology and the power needed to perform the task of regulating air throughout the surrounding environment, the average air conditioners cost quite a fortune. In terms of Enervent, I propose a new set of pricing considerations which emphasis on acknowledgement of the segments in which the product will be marketed. In other words, the pricing strategy should reflect discounts, bonuses, price competitiveness, etc. Nevertheless, managers cannot ignore the importance of having a valuable product. The psycography of customers sometimes generates new understanding over the behavior of consumers. For one, consumer often mistaken quality with price. Often we find that if we charge higher, people would buy the product more. Managers in charge of the pricing strategy must have considerable sensitiveness toward the behavior of his/her customers. 7.3. Distribution strategy Distribution is also a factor in marketing and selling products. Companies must have provided their officers with sufficient funding in order to prevent lack of funding in the delivery process. Often, the assignment on distribution is in line with order processing stages. In a sense, distribution is an inseparable part of order processing and the process is not over until the products are delivered successfully to customers. In terms of exporting the Enervent, managers of the distribution process should prepare all the necessary export preparation and documentation. Often shipments failed because of the lack of diligence in preparing the required documentation (Basche, 1971). Distribution management includes managing the cost of distribution. In we are to export Enervent as a part of our central operations, than it is important for us to assign the distribution cost to the recipient instead of to our own cost structure. Forwarding freight is crucial in distribution management. Managers of distribution process must also pay attention to other supporting issues like insurance and arbitration. The lack consideration of these small factors could generate problems in later days. In distributing the Enervent, we must also consider the fact that inventory support is crucial for distribution process. Inventory management and warehousing strategies must be accounted to the nature of the product to prevent losses or diminished product quality. 7.4. Promotional activities In terms of advertising and promotion, we have discussed the need to represent Enervent in different ways for different market segments. On the other hand, if reality forces us to choose, we must choose to represent the largest demands on the market. In the Enevernet case, this means promoting the product as the new generation of air conditioning. Promotions can be performed through ‘indirect forms’, like literature, direct mail, etc. There are also a more direct form of promotion which includes exhibitions and trade shows. Often, the presence of a good sales force is also influential to promotional activities. In marketing Enervent, managerial abilities to motivate sales forces are important to promotional activities. This is important considering the product is new in the market. Another way of motivating the promotional activities is by using agents. External agents who receive commissions are generally more motivated to do their job because of the compensation strategy. Reference †Air Pollution Might Affect Lung Development in Children, Study Finds.† 2004. Retrieved May 9, 2007 from http://www.californiahealthline.org/index.cfm?Action=dspItemitemID=105505 ARI CoolNet. â€Å"Air Conditioning: Improving the Way We Live.† Retrieved May 9, 2007 from http://www.ari.org/consumer/history/history-ac.html Basche, J.R. Jr. Export Marketing Services and Costs. 1971. New York: The Conference Board, p4. Cunningham, M.T. Strategies for International Industrial Marketing. 1986. In D.W. Turnbull and J.P. Valla (eds.) Croom Helm p 9. Delonghi.  « Delonghi Portable Air Conditioners Delonghi Portable Air Conditioning.  » 2007. Retrieved May 7, from http://www.delonghi-portable-air-conditioners.co.uk/images/3176.jpg Korey, G. Multilateral Perspectives in International Marketing Dynamics. 1986. European Journal of Marketing, Vol. 20, No. 7, pp 34-42 Keegan, W.J. Global Marketing Management. 1989. Prentice Hall International Editions. OK CHINA INDUSTRIAL LTD. â€Å"Wholesale Air conditioner.† 2007. Retrieved May 7, 2007 from http://www.sz-wholesale.com/shenzhen_China_products/Air-conditioner_1.htm Piercy, N. Company Internationalisation: Active and Reactive Exporting. 1982. European Journal of Marketing, Vol. 15, No. 3, pp 26-40. Saudi Aircon 2007. 2007. Riyadh Exhibitions. Retrieved May 9, 2007 from http://www.recexpo.com/recweb/show_overview.asp?id=79 â€Å"US Market for Air Conditioning.† Worldwide Market Intelligence. Retrieved May 9, 2007 from www.bsria.co.uk/documents/pdf/misc/17200 leaflet.pdf Ward, Susan. â€Å"How to Find and Master a Niche Market.† 2007. Retrieved May 9, 2007 from http://marketing.about.com/od/careersinmarketing/l/aa060303a.htm â€Å"Wind of change in air-conditioning market.† 2006. China Economic Net. Retrieved May 9, 2007 from http://www.chinadaily.com.cn/english/doc/2005-04/27/content_437865.htm

Business Development Policy of the Post-Socialist States of Central and

Business Development Policy of the Post-Socialist States of Central and Eastern Europe DISSERTATION PROPOSAL 1. Title of Dissertation: Small & Medium Business Development Policy of the Post-Socialist States of Central and Eastern Europe in their Transition to an Open Market Economy: Lessons and Applications for Cuba. 2. Aim of Dissertation & Motivation for Research: The objective of this dissertation is to study the small and medium business policies developed in Central and Eastern Europe (CEE) as a result of their transition to an open market economy. The experience gained from the extraordinary process of transition, still under way in CEE and in the former Soviet Union (FSU), is rich with lessons that could guide policy making and action in a Cuba of the future. This dissertation attempts to distill some of these lessons and to explore those, which would facilitate the growth of small and medium size enterprises, the so-called SMEs, when transition finally unfolds in the island. Many years after the initiation of transition in the former command economies of CEE and the FSU, one thing is certain: the process of transformation is far more complex and it takes far more time and resources than envisioned in 1989. The reason is that transition involves changing institutions, practices, and behaviors that have taken root in society during decades of centralized control and political repression. Another certainty is that it is possible to transform economic and political systems radically and end up with market economies and political democracies. Many years after the Berlin Wall fell; most production in countries in transition originates in the private sector and is transacted under free market conditions. In addition, most of the people live under democratic rule, where the people can vote governments out of office and have done so. The decision to change came about at different times in different countries in the region. In fact, Hungary, Poland, and Yugoslavia had already started some reforms by the late 1980s, before the destruction of the Wall. In 1990, COMECON, the Soviet dominated free trade area, was dissolved as members decided to start trading in hard currency and at world market prices. The disappearance of the Soviet Union, where Gorbachev had started a re-structuring program under socialism, witnessed in 1992 the start of transiti... ...Achievements in Transition Economies, 1989-1999,† London School of Economics, Centre for Economic Performance Discussion Paper No. 475. Lavigne, M. (1991). The Economics of Transition (New York: St. Martin’s Press). Lipton, D., and Sachs, J. (1990). â€Å"Creating a Market Economy in Eastern Europe: The Case of Poland,† Brookings Papers on Economic Activity, Vol. 1990, No. 1, pp. 75-133. Poirot, C. (1996). â€Å"Macroeconomic Policy in a Transitional Environment: Romania, 1989-1994,† Journal of Economic Issues, Vol. 30, No. 4, pp. 1057-75. Przeworski, A. (1991). Democracy and the Market: Political and Economic Reforms in Eastern Europe and Latin America (Cambridge: Cambridge University Press). Roland, G. (1994). â€Å"The Role of Political Constraints in Transition Strategies,† The Economics of Transition, Vol. 2, No.1, pp. 27-41. Sachs, J. (1992). â€Å"The Economic Transformation of Eastern Europe: The Case of Poland,† The American Economist, Vol. 36, No. 2, pp. 3-11. Shleifer, A. (1997). â€Å"Government in Transition,† European Economic Review, Vol. 41, No. 3-5, pp. 385-410. UN Statistics Division Social Indicators, http://unstats.un.org/unsd/demographic/social/default

Social Experience

Social Experience Social experience is a lifelong social experience by which people develop their human potential and learn culture. The interaction of humans has been studied through the ages by thinkers of all types Darwin, Watson, Freud, Meade and Paigets. They all came up with a different view of how we develop socially. How important are the roles of family, school, peer groups and the media on our personality development or is it all preordained and instinctual. There are two different theories of what happens in the beginning.Charles Darwin and Sigmund Freud believed that human behaviors were biologically based, that we have instinct for human competitiveness, sexual and emotional bonding, and aggressive behavior. The other school of thought as studied and proven by John B. Watson, Jean Paigets, and George Herbert Meade was that behaviorism or instincts are learned. Home is where the heart is and the beginning of the most important part of our skill set in interacting with oth ers and molding our personalities? Family is where we look for nurturing in the early childhood stages.Ideally family would be the foundation where the child would be given a safe and caring environment, teaching them skills, values and beliefs. In situations that lack this there are various levels of dysfunction that appear. This was proven by Harry and Margaret Harlow in the study of social isolation of young children. Total isolation of the child for six months or less will cause them to become passive, anxious, and fearful when introduced to groups of people, anything longer than that and the child will never fully regain the ability to function in society.Young children learn from their environment and are in the sensorimotor stage as Jena Paigets proclaims in the theory of cognitive development. They experience the world only through their senses in the ages of 0-2 years. Preoperational stages follows after that from 2-6 years using symbol, language and the beginnings of imagi nation and mental thought. The progression of learning in the family teaches us about our race and class in society. People born into a lower class family are not only affected financially but expectations can be lower.Families in struggling environments push conformity to help the family get by but these stresses of social inequality can make disobedience more prevalent. Families of higher standings or wealth can focus on good judgment, creativity and looking to the future. Schools become the second agent of socialization. It enlarges the social world of the child. Gender roles start to emerge. Boys tend to engage in more physical activities outdoors and behaviors inside the classroom can become more aggressive. Girls on the other hand typically do chores like help the teacher. They are quieter and better behaved.This brings into play the concrete operational stage of cognitive theory when children become aware of their surroundings. They focus on the how and why of things. Schools also teach an education curriculum some of which is apparent but there is also a hidden curriculum, such as spelling bees teaching children there are winners and losers, sports teaching skills of cooperation and competition. School is the first exposure to how the bureaucratic world works with the impersonal rules and strict schedules. This gives them the skill set to cope with the large organizations that may employ them.The third agent is the peer group; a social group whose members have interests, social position and age in common. George Herbert Meade has a theory of the social self. The Self or personality is composed of self awareness and self image; it develops only with social experience. It requires imagining the situation from the others point of view. The peer group can facilitate the knowledge of forming relationships outside of the family. It gives individuals a chance to discuss things of interest that might not be interesting to a parent or a partner.It produces soci al ties that lead to loyalty and pride in their peer groups which can lead to putting other groups down. We strive for anticipatory socialization which is the learning that takes place to help a person achieve a desired position, like Eagle Scout in Boys Scouts. The power of peer groups can be positive or negative to an adolescent. Challenges of gaining their identities in the absence of the family can leave the peer group as their only source for information. Teenagers are growing up faster every day because of divorce and both parents working.They become self sufficient sooner out of necessity rather than choice. The mass media it’s everywhere 24/7 and it is teaching our children. Is that bad? Socialization through the media is with us for good. There is one set for every person today. We spend half our free time watching it. Critics on both sides of the political arena have reservations about it. The liberals feel television plays a part in promoting racial and ethnic ster eotypes. The conservatives think television is dominated by the liberal elites and their message. The true concern for socialization is the amount of violence on the airways.Can it be healthy for a young child to watch people killed or better yet play a video game and be the one doing the killing? Media should never become the babysitter, parent and friend. The mind will become an unimaginative place if we stare to long at someone else’s imagination. It is already taking a toll on the health of our children with obesity rates getting higher every day. I can remember playing outside on the neighborhood streets till dusk. Riding bikes and walking to the local grocery store. Television is a good form of entertainment I fear based on the material in the book.It is becoming an obsession. The most important part of socialization will always be the family. This is where you should be able to go to feel safe. This is where you start and can continue to have a foundation to life. In t he reading of the many theorists there is development along the way but none of it as important as the things you learn in the beginning. Family is your tribe, your survival group. It doesn’t necessarily have to be a blood relative but the socialization needs to begin somewhere with someone for us to become a responsible member of society.