Marketing analysis:
Haefren Baum is a high class home furniture retailer. The company carries Wiegandt’s furniture, a well known recognized name brand for its high quality. Haefren Baum has been retailing home furnishing from one location in downtown Cologne and expanded their business recently nearby Rhineland suburban areas with three additional outlet stores. Due to the economic recessions, sales of furniture slowed down, so Haefren Baum decided to decrease prices in order to main sales volume. Sales decreased by 19% in 1993 and by 5% in 1995. The recession has been improving through the years, however it does not help the furniture market since there is a high market competencies with competitors. Haefren is having trouble maintaining their competitive advantage considering European retailers are entering the German furniture market. Haefren Baum will need to adapt to the rapid transition of competition.
Operations analysis: …show more content…
This situation is causing problems for the company because the operation profit has decreased from 5.6 to 1.6 from 1993 to 1995. Another problem the company is consisting is the low total asset turnover due to their decrease in sales. The low asset turnover decreased from 2.1 to 1.50 within the three years; therefore their assets are not organized and can be more efficient if used properly. Inventory days has increased from 103 days to 129, which means the decrease in sales is hurting Haefren Baum and assets are being less liquidated. The company is experiencing a drastic loss of operation profit, considering their operation profit was 943 at the end of 1993 to 216 in
Haefren Baum is a high class home furniture retailer. The company carries Wiegandt’s furniture, a well known recognized name brand for its high quality. Haefren Baum has been retailing home furnishing from one location in downtown Cologne and expanded their business recently nearby Rhineland suburban areas with three additional outlet stores. Due to the economic recessions, sales of furniture slowed down, so Haefren Baum decided to decrease prices in order to main sales volume. Sales decreased by 19% in 1993 and by 5% in 1995. The recession has been improving through the years, however it does not help the furniture market since there is a high market competencies with competitors. Haefren is having trouble maintaining their competitive advantage considering European retailers are entering the German furniture market. Haefren Baum will need to adapt to the rapid transition of competition.
Operations analysis: …show more content…
This situation is causing problems for the company because the operation profit has decreased from 5.6 to 1.6 from 1993 to 1995. Another problem the company is consisting is the low total asset turnover due to their decrease in sales. The low asset turnover decreased from 2.1 to 1.50 within the three years; therefore their assets are not organized and can be more efficient if used properly. Inventory days has increased from 103 days to 129, which means the decrease in sales is hurting Haefren Baum and assets are being less liquidated. The company is experiencing a drastic loss of operation profit, considering their operation profit was 943 at the end of 1993 to 216 in