Springbok Co is a clothing retailer, with stores selling mid-price clothes and clothing accessories throughout Europe. It sells its own-brand items which are produced by small manufacturers located in Africa, who work solely for Springbok Co. The recent European sovereign debt crisis has affected a number of countries in the European Union (EU). Consequently, Springbok Co has found trading conditions to be extremely difficult, putting pressure on profits and sales revenue. The sovereign debt crisis in Europe resulted in countries finding it increasingly difficult and expensive to issue government bonds to raise funds. Two main reasons have been put forward to explain why the crisis took place. Firstly, a number of countries continued to borrow excessive funds because their expenditure exceeded taxation revenue. Secondly, a number of countries allocated significant sums of money to support their banks following the credit crunch and the banking crisis. In order to prevent countries defaulting on their debt obligations and being downgraded, the countries in the EU and the International Monetary Fund (IMF) established a fund to provide financial support to member state threatened by the risk of default, credit downgrades and excessive borrowing yields. Strict economic conditions known as austerity measures were imposed on these countries in exchange for receiving financial support. The austerity measures have affected Springbok Co negatively. 2018 and 2019 have been particularly bad with sales revenue declined by 15% and profits by 25% in 2018 and remained at 2018 levels in 2019. On investigation, Springbok Co noted that clothing retailers selling clothes at low prices and at high prices were not affected as badly as Springbok Co or other mid-price retailers. Indeed, the retailers selling at low-priced clothes had increased their profits and retailers selling luxury, expensive clothes had maintained their profits over the last two to three years. In order to improve profitability, Springbok Co’s board of directors expects to cut costs where possible. A significant fixed cost relates to quality control which includes monitoring the working conditions of employees of Springbok Co clothing manufacturers as part of its ethical commitment. (i) Suggest why the austerity measures might not have affected clothing retailers at the high and low price range as much as the mid-price range retailers like Springbok Co.
Critical Path Method
The critical path is the longest succession of tasks that has to be successfully completed to conclude a project entirely. The tasks involved in the sequence are called critical activities, as any task getting delayed will result in the whole project getting delayed. To determine the time duration of a project, the critical path has to be identified. The critical path method or CPM is used by project managers to evaluate the least amount of time required to finish each task with the least amount of delay.
Cost Analysis
The entire idea of cost of production or definition of production cost is applied corresponding or we can say that it is related to investment or money cost. Money cost or investment refers to any money expenditure which the firm or supplier or producer undertakes in purchasing or hiring factor of production or factor services.
Inventory Management
Inventory management is the process or system of handling all the goods that an organization owns. In simpler terms, inventory management deals with how a company orders, stores, and uses its goods.
Project Management
Project Management is all about management and optimum utilization of the resources in the best possible manner to develop the software as per the requirement of the client. Here the Project refers to the development of software to meet the end objective of the client by providing the required product or service within a specified Period of time and ensuring high quality. This can be done by managing all the available resources. In short, it can be defined as an application of knowledge, skills, tools, and techniques to meet the objective of the Project. It is the duty of a Project Manager to achieve the objective of the Project as per the specifications given by the client.
Springbok Co is a clothing retailer, with stores selling mid-price clothes and
clothing accessories throughout Europe. It sells its own-brand items which are
produced by small manufacturers located in Africa, who work solely for
Springbok Co.
The recent European sovereign debt crisis has affected a number of countries in
the European Union (EU). Consequently, Springbok Co has found trading
conditions to be extremely difficult, putting pressure on profits and sales
revenue.
The sovereign debt crisis in Europe resulted in countries finding it increasingly
difficult and expensive to issue government bonds to raise funds. Two main
reasons have been put forward to explain why the crisis took place. Firstly, a
number of countries continued to borrow excessive funds because their
expenditure exceeded
allocated significant sums of money to support their banks following the credit
crunch and the banking crisis.
In order to prevent countries defaulting on their debt obligations and being
downgraded, the countries in the EU and the International Monetary Fund
(IMF) established a fund to provide financial support to member state threatened
by the risk of default, credit downgrades and excessive borrowing yields. Strict
economic conditions known as austerity measures were imposed on these
countries in exchange for receiving financial support.
The austerity measures have affected Springbok Co negatively. 2018 and 2019
have been particularly bad with sales revenue declined by 15% and profits by
25% in 2018 and remained at 2018 levels in 2019. On investigation, Springbok
Co noted that clothing retailers selling clothes at low prices and at high prices
were not affected as badly as Springbok Co or other mid-price retailers. Indeed,
the retailers selling at low-priced clothes had increased their profits and retailers
selling luxury, expensive clothes had maintained their profits over the last two
to three years.
In order to improve profitability, Springbok Co’s board of directors expects to
cut costs where possible. A significant fixed cost relates to quality control which
includes monitoring the working conditions of employees of Springbok Co
clothing manufacturers as part of its ethical commitment.
(i) Suggest why the austerity measures might not have affected clothing
retailers at the high and low price range as much as the mid-price range
retailers like Springbok Co.
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