Saturday, September 06, 2008

Of Business Capstone V

Train your soldiers for a thousand days to use it for one day. A chinese saying says..

The actual round of the stimulation produced somewhat different results. For the first round, our projections and investment into Product Development and Marketing gave us confidence that we would be able to sell our products well and grab market share from others.

Instead, there were inventory leftover, the loss of income from projected sales was never properly recovered which resulted in a massive emergency loan for cash flow, this emergency loan also came with a higher interest rate.. 

In short, we lost big money in Year 1 and that result in a cumulative lost in Year 1.

Year 2

More conservative projections from the team now.

We sold all that we produced and made profits for Year 2, selling out our products also mean that we did not manage to maximise our profits, loss of sales means competitions benefit from our under-projection of sales. 

The cumalative profits was still negative, got to depend on Year 3 to bring the company back in the black.



Hope all goes well for Year 2, results ready next week.

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