Evaluating The New Line of Production

Question: Describe about the Evaluating of The New Line of Production. Answer: 1. Analyzing these two I would say it would be wise to venture into the new line of production of organic cosmetics. Norton points the fact that they are supposed to work on moving into organic cosmetics quickly as she sees that they could become the leader of the universe in a short while (Berle, 1993). She backs this up by the fact that the company has a good reputation and an excellent brand recognition Norton believes that the continued trajectory in the market and the launch of the new cosmetic line could increase Seasides revenues by 75% by the coming year. She estimates that if the company would raise prices on seasides skincare line of production by 10% and lower line by 5% then the company would be at an absolute position to fund the development of the proposal suggested by Suriala. She supports this after doing some rudimentary business plan provided they maintain their yearly growth rate (Houben, Lenie and Vanhoof, 1999). Mackintosh weighing the options of launching the new proposed line of production could prove disastrous. She believes that the current market for organic personal care is fragmented as shown by the research they did last January (Robinson, 2006). However she forgets that the market for organic foods in the 1990s wasnt so much appreciated by the consumers but as the years went by as the consumers realized the dangers associated with continuous exposure to chemicals in the non-organic products they started shifting their preference to the organic ones and there has been a continuous growth of roughly 10% on the organic product market since then (Berle, 1993). The same can happen people will start realizing the dangers of inorganic cosmetics and shift their interest to the organic ones and if the company will have engaged in its production then there will be a tremendous growth in revenue and Nortons 75% target of revenue could be realized rate (Houben, Lenie and Vanhoof, 1999). The res earch also revealed that the slightest price increase would make the company lose their existing customers and they really can't afford that. Mackintosh supports her opinion by saying that raising the prices of their current product could be dangerous especially now that they have to catch up to the growth of the last couple of years and do some planning (Hargroves and Smith, 2013).However, Mackintosh provides a better plan that if they could increase the coming years revenue by 25% by channeling their focus on increasing their retail distribution of the current products. He claims that by increasing their retail distribution they have a better chance of expanding internationally unlike starting a cosmetic line of production which could drain their resources and even affect the existing brand (Hargroves and Smith, 2013). This fact provides a clear proof that Norton is an entrepreneur and sees an opportunity, a potential market gap and wants to use the resources of her company to fill the gap. Mackintosh, however, provides an opposition, she clearly is not ready to take a risk ( Mircea, Ghilic-Micu and Stoica, 2011). She bases her claims on how currently the companys financial situation is. She goes ahead to support her arguments with a research done to determine the consumers take on the proposed line of production that Norton wants to venture in saying it proves very risky (Bloisi and Hunsaker, 2007). However, Norton already did analysis on how the business is going to come up with the capital to finance the new line of production. She sets hers focus on the reward of a 75% increase in revenue. The company is definitely poised for future success. If they are to conduct several market research then they would have a better and clear vision of the consumers wants. Given the recent trend of a shift of preference from inorganic to organic products and the statics giving the facts that although the organic skin care growth is much higher than that of organic cosmetics but their growth forecast as per the year 2020 are similar ( Mircea, Ghilic-Micu and Stoica, 2011). Although the market research also revealed that that the slightest price increase would make the company lose their existing customers but if the two are to settle on a middle ground and Norton accepts Mackintoshs suggest that they increase the coming years revenue by 25% by focusing on increasing their retail distribution of the current products then they could have enough capital to start the new line of production that Norton proposes. By increasing their retail distribution they have a better chance of expanding internationally and this will give the absolute financial basis in which they can start and run the new line of production (Bloisi and Hunsaker, 2007). 2. Sarah Norton should deal with her difference with Mackintosh by accepting to expand the line of production and establish new distribution links into new areas (Baron, 2006). By so doing they would increase the income revenue by 25% as Mackintosh suggested then at the very time convince Mackintosh into venturing into the new line of production and because they now have the capital they will be no need of trying to maintain their yearly growth rate and raise prices on seasides skincare line of production by 10% and lower line by 5% since they will have the capital with them. Just like in the years before 2010 Norton had a vision of expanding Seashore into a new customer segment and still Mackintosh was in contrast. Although the company did undergo some challenges and decided to give off the project to Roland they finally emerged very successful as the risk was taken and the rewards were realized (Drummond, 2009). 3. If Sarah Norton isnt able to persuade Mackintosh of her business opportunity. Then she will have an option of using her personal saving and venture into the business (Drummond, 2009). She can also team up with people like Roland who founded a manufacturing of organic personal care commodities and also who happens to be so good in the entrepreneurial drive in resolving manufacturing challenges and together they can start the production of organic cosmetics. Another option since Norton is the majority shareholder she can just endorse her plan and put everything in action by trying to maintain their yearly growth rate and raise prices on Seasides skincare line of production by 10% and lower line by 5% and get enough capital and start the production of organic cosmetics as she desires then drive the company towards her 75% revenue increase goal (Baron, 2006). References Baron, R.A., 2006. Opportunity recognition as pattern recognition: How entrepreneurs connect the dots to identify new business opportunities. The Academy of Management Perspectives, 20(1), pp.104-119. Berle, G., 1993. The green entrepreneur: Business opportunities that can save the Earth make you money. Bloisi, W., Cook, C.W. and Hunsaker, P.L., 2007. Management organisational behaviour (2nd European edition). Berkshire: McGraw-Hill Education. Crilly, D. (2012). STAKEHOLDERS: THREAT OR OPPORTUNITY. Business Strategy Review, 23(4), pp.59-61. Drummond, H. (2009). 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