"If" scenarios to memorize across sales, profit, and product

Question 1

Sales: If sales are flat and profit are tanking – what do you examine?

Answer 1

revenues and costs (always start with revenues)

Question 2

Sales: If sales are flat but market share remain relatively constant – what does this tell you?

Answer 2

industry sales are flat and competitors are experiencing similar problems

Question 3

Sales: If your sales are declining, what 3 things should you analyze

Answer 3

1. overall decline in market demand
2. possibility that current marketplace is mature or your product is obsolete
3. loss of market share because of substitutions

Question 4

Sales: if sales and market share are increasing but profits are declining – what should you investigate?

Answer 4

whether prices are dropping and/or costs are climbing. You should investigate changes in product mix and margins and if players are leaving the market

Question 5

Product: If a product is in its emerging growth stage – what should you focus on for solutions?

Answer 5

R&D, competition, and pricing

Question 6

Product: If a product is in it growth stage – what should you focus on for solutions?

Answer 6

Marketing and competition

Question 7

Product: If a product is in its mature stage – what should you focus on for solutions?

Answer 7

manufacturing, costs, and competition

Question 8

Product: If a product is in its decline stage – what should you focus on for solutions?

Answer 8

define niche markets, analyze the competition’s play, or think exit strategy

Question 9

Pricing: What 3 conditions must be met to indicate price stability?

Answer 9

1. Growth rate for all competitors is approximately the same
2. Prices are paralleling costs
3. Prices of all competitors are roughly of equal value