Jennifer's questions and thoughts posed in the last couple of paragraphs are right on target. Selling more stuff is certainly the way to raise gross income, but reactive consolidation dilutes the effort. This is particularly true in promotion and marketing which ironically are among the first things cut when "things get tight." On one hand, this creates tremendous opportunities for smaller players to rise above the surface.
I agree with Anna. In my experience, when companies hit a snag in sales, panic ensues and they do anything to "sell more stuff". Long term strategy and goals go out the window in favor of short term sales. In my opinion, that is how they tend to shoot themselves in the foot. It would be wonderful if companies had long term strategic plans that are flexible enough to withstand fluctuations in the market. That may be easier said than done.
With all good intent these companies are not projecting "sell more stuff" on a long term profitability strategy. The aim I suppose is to keep the share holders and investors happy and will do whatever it takes to ensure the profit margin is steady and ever increasing.
Of course ANY publicly held company would assert that their plan is to sell more stuff and return to at least the previous profitability. What else could they possibly say? The board of directors and the stockholders would have no mercy at all if they were to say anything else!
My point is that most projections are made with the sole intent of increasing share prices for the short term, since that is what brings in the money for top management, who are the only ones authorized to speak for a company. We have observed that these folks will lie to fedral investigators and to congress, so why would we think that they would feel compelled to tell us the truth?
If they said that they were going to retrench and invest a lot of money in developing a better or different product, and that the dividends would be small this quarter, they would be on the street the same day. We all suspect this, but won't admit that we do.
You what's even stranger is my own inability to hold firm. While I truly believe consumers don't need more stuff and the corporate "sell more" strategy doesn't go far enough to address many issue, I've got to admit I was excited to see Amazon's Fie tablet announcement yesterday. My first reaction: Wow!Great! I can buy a tablet for $199. My second reaction: Yeah, but you don't actually need a $199 tablet. You already all the devices you need.
It's undecided which voice in my head will win and which argument will stick.
I'm with you completely. Why is it that company’s always use the "sell more stuff" approach, particularly after they have made cuts to their bottom lines? You would think at some point the executives would realize that people without jobs don't buy things other than necessities. I agree that wouldn't it be nice to have these companies put a collective head together to solve the issues rather than put bandages over them. Then again, look at the U.S. government and how they handle problem solving.
In today's times the consumers are used to see newer and newer products every now and then being introduced in the market and a lot of product promotions being pushed onto them. In such a scenario "Sell more stuff" strategy may be required for the companies to keep market continuity and keeping their name afloat in the marketplace albeit at a loss at times.
I remembered a recent article by Thomas Dinges titled 'Is the EMS industry facing another recession' and he wrote that industry is trying to move towards enterprise oriented products as this can help them in bearing the short term glitches. Can this strategy work or we need to revisit part to find a working strategy or we need a modern and futuristic strategy to cope with slow growth?
EBN Dialogue enables and encourages you to participate in live chats with notable leaders and luminaries. Not only editors and journalists, but the entire EBN community is able to comment and ask questions. Listed below are upcoming and archived chats.
Archived Dialogues
Thailand Stages a Comeback Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Euro-Crisis: What It Means for High-Tech Firms Join EBN Editor in Chief Bolaji Ojo and Contributing Editor Jennifer Baljko on Thursday, July 12, at 10:00 a.m. EDT for a Live Chat on high-tech and Europe's economic difficulties.
Microsoft Surface: Potential Winners & Losers What are the implications for the electronics industry supply chain of Microsoft Corp.'s decision to launch its own tablet PC? Join industry veteran and EE Times' systems and OEM expert Rick Merritt on Tuesday, July 3, at 12:00 pm EDT for a Live Chat on this subject.
Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Peter Drucker famously said "Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window." Yet in the razor's-edge world of electronics—with a lean supply chain and just-in-time demands—the need to know the future is vital.
You've heard the saying "the No. 1 supply chain risk is your people." That hasn't always been the case. But today's complex global supply chain requires a new type of multitalented employee. It's one who understands, finance, marketing, economics, is savvy with technology, graceful with relationships and can think analytically.
Where are these people? Are universities properly preparing the next generation supply chain professionals? How do train your existing workforce for these new, demanding positions?
Brian Fuller, editor-in-chief of EBN, will lead a 60-minute Avnet Velocity panel discussion that will ask and answer these and other questions swirling around today's supply-chain talent challenges.
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