Help with “marketing strategy” and marketing and other issues etc questions. F293 revision business studies ocr

Hi,

So I got an email yesterday and tried to help someone answer a question that asks to “recommend a marketing strategy.” For this question, you need to base it around the four 4 p’s as much as possible.That is, product, price, place and promotion. These are some of the points I suggested to consider. Hope it helps anyone! 🙂

As in talk about product, price place and promotion like what factors are there to consider. Okay so like,
 
Price: can they afford it? if not why not? how do we know? what are the costs associated? if they cant afford it should they forget about it or should they find another source of finance? which one and why?
 
Promotion: what adverising should they use? above the line or below the line? which type? how much will it cost? justify the best way why you think that. How could they promote the product successfully?
 
Product: how can they make their product market well? will they need to focus on what kind of production method they will be using? which one and why? do they have the USP to market the product well? should they carry out market research to have a more customer orientated product?
 
Place; what channels of distribution should they use and why? which one is most beneficial and what are the drawbacks of the one you  choose? should they stock the product or have a stockist or an outlet? 
 
Hope this helps?? its just about getting into as much detail about these things and it should help..
 
 
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Aab’s marketing strategy f292 business studies all about the baby case study 2014- Discuss the factors which AAB might consider when deciding upon a marketing strategy for the Healthy Sleep Mattress (20)

When considering a marketing strategy for the new healthy sleep mattress, it may be a good start for Javier and Elizabeth to begin with the four 4 p’s. The Four p’s consist of price, product, promotion and place and can be a good start for indicating further steps that AAB must take when it comes to marketing the new Healthy Sleep Mattress.

Firstly, AAB will need to consider the price. At the moment, Peter thinks that AAB can set the retail price roughly between ÂŁ250 and ÂŁ300, however AAB will need to consider this decision heavily, especially considering that two of the more higher end products such as AAB’s “ultimate” mattress as well as the Supreme are neither receiving the highest possible sales volume, with one facing decline and the other with the estimated market share ending in August 2013 classed as ‘low’ Therefore it could be argued that such a high price may not be advisable as AAB will need to get customers interested and try the product before it establishes a good reputation. With limited information on the product and cost figures for the healthy sleep mattress, there are two pricing strategies that are advisable for AAB to adopt.

For one, AAB may choose to adopt the pricing strategy ‘price skimming’ for the Healthy Sleep Mattress (HSM.) Price skimming involves setting high prices to secure low volume of sales in order to skim the profit from the market before potential competitors take the idea and create their own substitutes. This could be an appropriate pricing strategy for Pete, Javier and Elizabeth to consider as it means that the business will be able to get the best return on the investment before substitutes are introduced. It is reasonable to argue that this will be an appropriate strategy due to the nature of the HSM, being innovative and potentially ground breaking, it makes little sense for AAB to use a loss leaders type pricing strategy as this gives AAB the opportunity to reap the benefits from the market by having an unique and innovative product. Taking into consideration that the fibre is made up of50% of recycled materials with no chemicals or odours, AAB may find that this pricing strategy only caters for the ‘early adopters.’ In this case, Early adopters may only purchase the new HSM at the high cost price that Price skimming entails due to having brand loyalty or are willing to pay high prices to achieve exclusivity. Therefore this pricing strategy may not be suitable for all, as whilst AAB may have some ‘early adopters’ the new mattress will only come in one size and therefore this may be an irrelevant purchase if their child is currently too big to use the one size style of the new breathable healthy sleep mattress.

Another pricing strategy that AAB may consider to adopt, considering the lack of information provided is penetration pricing. Quite the opposite to price skimming, penetration pricing involves setting low prices in order to gain a foothold in the market and therefore secure a higher sales volume. By doing this, AAB will inevitably encourage brand loyalty as customers are invited to try this product at a low price in the hopes that this results in good word of mouth, brand loyalty and eventually repeat custom. However, AAB will need to consider a number of things when introducing this pricing strategy with the HSM , despite being a product that is unique, the low price associated with penetration pricing may allow customers to think that the product is poor quality and therefore may not result in high sales. Additionally, penetration pricing will lower the profit margins created by the HSM and may hinder AAB from meeting their key objective of increasing profitability within the next 12 months.

In addition to price, AAB will need to consider promotion. There are a number of promotion strategies that AAB may find useful when marketing this new healthy sleep mattress. Due to the HSM being a new product with innovative features, it is likely to require a high degree of promotion. However, taking in to consideration the current loss making situation of All About the Baby, it is important that they keep costs to a minimum without spending too much that above the line promotion entails for example television adverts. Therefore, perhaps bearing in mind that the new HSM mattress will be exclusive to only AAB’s stores and not retailers, AAB could use the above the line promotion strategy of newspapers. This means that AAB will be able to geographically select the news papers in the areas in, and close to the stores that AAB currently have their own retailers in. This will not only mean that purchasing from the store will be convenient to customers, but it also means that this method of promotion directly influences and exposes the new products to customers that have the potential to buy one.

Additionally, AAB could use below the line promotion. This will be exceptionally useful as AAB’s new HSM has a number of unique features such as a clean safe hypoallergenic material, and is made up of 50% recycled materials. For this reason, it may be a good idea for AAB to market at trade fairs for mothers and set up desks in their own stores that aim on educating customers. By doing this, AAB have a better chance at reaching customers that are not only directly influenced to the specific nature of AAB’s products (children and mothers) but also will be able to market the benefits of the new healthy sleep mattress by enlightening customers face to face about the benefits for going for this healthy mattress.

AAB will need to consider its current stock issues when marketing this product. It could be argued that if AAB keep having this problem, customers will no longer be interested in the bad word of mouth and adverse publicity and therefore purchase customers from AAB’s competitors. Therefore, taking into consideration price and promotion, AAB will need to weigh out the multiple factors that need to be considered when figuring an appropriate marketing strategy.

Addressing some key issues in the APSL case study.

There are some obvious hints at some of the possible questions for this F297 exam. Whilst nothing should be put passed OCR, it could be useful to plan some possible answers for possible questions.

Should APSL leave its focus on the UK caravan market behind to focus on its other objectives?

Important factors to consider:

  1. According to the case study “APSL have set a 2018 objective of exports rising to 15%
  2. APSL sales to the UK caravan industry almost always tend to be sold to UK based caravan enthusiasts
  3. the majority of [luxury UK based motor car manufacturer] cars are destined for the export market

From this, we can take a few things. If APSL continue to aim their focus at UK caravan companies, they are hindering their ability to reach their 2018 objective of exports rising. Additionally, perhaps selling to a car companies is more beneficial as these tend to be exported outside the UK.

Should APSL then direct their focus towards the export market only?

  • As stated in the case study: “APSL’s exposure to the UK business cycle will be reduced”
  • the caravan company is a “long established customer” and therefore APSL may not want to have bad relationships>bad word of mouth> loss of profit
  • Focusing on cars is likely to have more revenue, yet, APSL should consider exchange rates and how this may impact APSL’s exposure to the export markets outside of the pound currency.

Should APSL invest in the new energy saving device?

Additionally, another issue that arises in the case study is the debate of using a heat press. The business has seen expenditure on energy steadily rise, and especially in the August of 2013 did they experience sizeable increases. Investing in a new heat device, costing ÂŁ250,000 means that APSL could yield a saving of 4% per annum.

Important points to consider:

  • There are conflicting views with the owners: Kate is keen to go ahead, Peter thinks that the financial return would offer APSL too low and John is less sure the decision should be based solely on quantitive factors.

Therefore it may make sense for a question to debate by siding with a owner. Should APSL jump in like many other projects they are pursuing currently? Should APSL focus on saving money for future investments? or should APSL consider a little more than money and profit and perhaps think about other social factors.

When siding with John, then, what other factors (qualitive) should be considered when taking on the energy saving device?

  • CSR: investing in an energy saving device will help APSL improve their ethical brand of the company as well as improving their corporate social responsibility. By showing that they are working towards saving energy and the environment through renewable energy, APSL can brand themselves as an “environmentally friendly” business.
  • In addition, APSL places a strong emphasis on environmental issues. Seen through their environmental policy and strict employee , this can help APSL comply with number 3 of their environmental policy: “we are committed to the most efficient use of resources” and a commitment to recycling and therefore the energy saving device will be the most strategic method of APSL adhering this policy.
  • Finally, APSL are experiencing complaints from Mr Gilman: through the dumping of APSL’s waste, it could be a point that investing in this energy saving machine could be a method of APSL giving back and compensating for the other unethical issues that it is dealing with. Perhaps it can be their way of ‘making up’ after the several incidents of dumping industrial waste.

Should APSL handle the environmental issues itself?

(Perhaps it’s worth mentioning- I like Peter a lot!)

Whilst these points will inevitably be similar to the previous question, they will not be synonymous.

Important points to consider:

  1. parts produced by APSL cannot be reworked if they are non compliant with the customer’s specification
  2. non compliant parts are shredded In a granulating machine and then sold back to the raw material supplier
  3. parts which cannot be recycled are taken away by a disposal contractor: Waste Away
  4. Peter has argued that this disposal is something which APSL should do for itself
  5. Kate and John feel that doing so would be incompatible with APSL’s strategic advantage
  6. APSL received a complaint letter from Mr Gilman: “if you should not stop I will have no option than to put the matter in the hands of my solicitors”

Should APSL take this matter into their own hands?

  • APSL are paying Waste-away Ltd to simply dump industrial waste on to a road. Perhaps they should handle this problem themselves as it means their reputation is not in danger and that they can save money
  • APSL has a clear focus on its many objectives and therefore if they were to handle waste disposal too, it can be too many things for the owners to focus on
  • APSL could find another disposal company that is reputable for reliable service
  • If they handle the issue themselves, it is likely to improve their reputation as well as corporate social responsibility (if they volunteer/donate) to funds that surround themselves with being sustainable environmentally..

How should APSL respond to Mr.Gilman?

  • Firstly, APSL should explain that they are not wholly responsible for this dumping: they have ensured that a company takes the waste and believed they would deal with it responsibly rather than fly tipping. This is likely to achieve some understanding between Mr.Gilman and the owners
  • Next, APSL should focus on how to approach the actual problem. Perhaps they could explain that they are sorting out the problem by finding a more reliable business or even handling the problem themselves.
  • APSL should offer a form of compensation to Mr Gilman for having to clear the dumped waste by himself
  • APSL should consider other ways they could make up for this dump of  non compliant parts: donate, invest in energy saving device, invest in Flaxiboard

As requested, the next analysis will be on fringe benefits and taxation.

Apsl case study f297 business ocr revision strategic management- flaxiboard

Hi everyone. I’m on study leave now, so hopefully I’ll be posting more. I don’t know if you’ve noticed through different writing styles but most of the essays I’ve posted recently have been given to me by friends and classmates to post on here. Just for any questions that I haven’t covered. Nonetheless, I’m going back to writing them.

 

 

 

The question I will be addressing MYSELF today is:

Should APSL accept the order for 60 doors made from Flaxiboard from Albion Aerospace?

APSL currently use plastic to form their products for customers. Whilst plastic remains both the easier and cheaper option for APSL to utilise, the apparent benefits of using Flaxiboard seem both appealing and beneficial. In contrast to plastic, Flaxiboard is a reneweable source which means that when the supply of plastic eventually runs out, APSL will have another source to carry on operating the business in the existing market. However, with all business opportunities come disadvantages. It appears that Flaxiboard is slightly more expensive, as well as taking a total of 1 minute longer to press in contrast to the current material of plastic that APSL use. Thus, Kate, Peter and John will need to extensively evaluate the decision to use the Dutch supplied ‘Flaxiboard’ to produve 60 doors for the company Albion Aerospace.

It becomes clear that Albion Aerospace is a “prestigious customer” for APSL and therefore is likely to have a high interest in the business. Being a valuable customer, APSL is unlikely to want to disappoint Albion Aerospace by rejecting their order and therefore John may well have to go through with it otherwise his decision could result in bad word of mouth and ultimately have an impact on the company’s ability to meet their 10 year strategic objective of improving solvency ratio’s. Additionally, APSL will need to carefully consider the cost factors involved. The difference between the cost of plastic and Flaxiboard is ÂŁ1.20 and therefore a total of ÂŁ72 will be added to the cost of purchasing 60 flaxiboard doors from APSL. Therefore, APSL may have to add an extra cost on to the usual selling price of the doors in order to cater for Albion Aerospace’s order as well as covering their own cost of utilising a more expensive flaxiboard. However, this may also impact the demand for APSL’s product. If APSL find that they will need to add extra on to the original price per door when using Flaxiboard, it may hinder the desire for purchasing the product on Albion’s behalf. Thus, APSL will need to consider the elasticity of the product: if by conducting a supply and demand graph, APSL find that the door is elastic and this may impact the demand required, it may not be a good idea to go with the Flaxiboard as it means APSL will ultimately lose a large order. However, if Kate, John and Peter find that APSL’s products are inelastic, they have the ability to raise prices slightly higher in order to cover the cost of purchasing flaxiboard and therefore raising prices will be less risky for the business.

On the other hand, despite having additional costs attached to using Flaxiboard, APSL must not ignore the obvious advantages that this opportunity could cause. In hindsight, APSL will only producing 60 doors for one customer and therefore this order may be perceived as a ‘trial.’ It Is important that APSL consider the advantages of risk taking and forsee that this may benefit APSL’s ability to reach their long term objectives. In other words, if APSL truly wish to improve their solvency and maintain profit within the business, they must be willing to explore other products and the benefits they may have, despite costing more. Ultimately then, having a trial run of Flaxiboard is likely to give Kate, John and Peter a good idea of what the material will be like to use. If the owners of APSL find that staff are having difficulty using the new material, as well as if the machinery find the material made from sugar beet waste being too complex to mould, APSL will be able to learn from this large scale trial that they should not purchase more of it and make it a permanent component of APSL’s raw supplies. Whilst this is a risk worth taking, it could be argued however that using Flaxiboard to conduct a project of 60 doors for the customer Albion Aerospace will be too costly of a project. Despite revenue rising by 23.6%, APSL still have falling margins which could be argued is caused by the extra cost in supplies and materials. Therefore, it is irrational for APSL to use an even more expensive material causing their margins to fall even further which will result in APSL gaining an even smaller profit that last year. Thus, if APSL are serious about reaching their strategic objective of improving solvency ratio’s, they must take appropriate cutbacks, and perhaps avoiding Flaxiboard is a good way to manage profit margins and meet targets.

APSL should consider their corporate social responsibility when making this decision. Using Flaxiboard has it’s environmental benefits such as being both “renewable and biodegradable.” In short, APSL will have a good public reputation by producing this for Albion Aerospace as it will lead to good word of mouth and therefore more customers can find out that they can have their products produced without the stress of harming the environment. It is reasonable to argue that if APSL show that they are conscious about the environment and are trying to ‘give back’ it is likely that they will be able to compensate for issues addressed in Mr.Gilman’s letter such as dumping of non compliant products through helping and investing in resources that will help/not harm the environment. Ultimately, if APSL find that using Flaxiboard helps to improve their image as a environmentally friendly business, then it is a risk worth taking as it may help to increase further orders from other businesses that are interested in improving their corporate social responsibility.

Finally, APSL should take the risk and supply 60 doors to Albion Aerospace due to the definite advantages. Whilst APSL could be impacted by cost, reputation and the jeopardising of future objectives: it is certainly a risk worth taking as Flaxiboard could help APSL achieve their ultimate goal of improving solvency by offering the business an opportunity to maximise their profits.

Apsl case study business f297 question

21) Discuss the non-financial motivation APSL management might use to ensure staff output is sufficient to ensure that APSL’s unit labour cost is low enough to produce the targeted margins on its near 1800 potential product lines?

Peter currently pays his staff 10% higher than other local companies, he does this as APSL believes this helps him to both motivate employees and enables them to choose the best employee’s when recruiting. However this is a highly expensive method of motivating staff, and has made staff very financially driven over time. This means that non-financial methods may be less influential at APSL than at competiting companies with less financially driven employees’.

One method which APSL could use to motivate employees could be Job Enrichment, where they give the employees slightly harder work than they would normally do, in order to challenge them to learn how to do more, and thereby be better at their jobs. This is helpful as it can help train employee’s at other tasks, while being cheap to do. It also makes them feel more respected and needed at their job, therefore motivating them, and making them have a happier time at work. However this is only a good method to motivate them, but only if employees are driven enough to want to achieve this. Employees may however be demotivated if they struggle to complete the task, and may even feel anger towards APSL for giving them work which they are not trained and skilled enough to complete.

Another method which APSL could use is Consultation, where managers consult all decisions with the employees. This makes them feel well respected, and like their decisions and opinions are taking into consideration carefully. It can often make them feel as though they are a large part of the business, and they want the decisions which they have helped make to be successful, and therefore they will work much harder and more efficiently to try and ensure it does. However consulting takes large amount on time, and this takes time away from working and producing products. Therefore it may result in a loss in production overall if it fails to increase enough efficiency.

A further possible method could be Job Rotation, where they change jobs within the business every now and again to prevent people from getting bored, and demotivated. This would mean that one week an employee may be doing one job such as the caravan parts, whereas the next they could be doing the contract with the Turkeish company, or even the possible Flaxiboard. This gives the employee’s a well-rounded job, letting them develop skills in different positions. However employees are likely to be less trained at each job, due to the excessive costs in training them as thoroughly in every single aspect, and less on the job experience. This may mean that quality is lower, with a higher percentage of products being thrown away as they are non-compliant. This would result in higher costs again with more materials being needed, and Waste Away LTD might need paying more to cover the increase. It would also not fit in with the companies environmental polices.

Overall many methods could be used to motivate employees fairly cheaply, but if it is badly managed or employees are reluctant, then it may result in many different costs, which could amount to much higher overall than the extra 10% they are currently paying. As the employees are also very financially driven, these polices may fail to be as effective as the other, more financial methods are.

Apsl case study question Ocr business studies f297

*This essay has also done by my class mate. (I am trying to get as many essays up to help you guys :D)

Evaluate Peter’s policy to pay staff 10% higher than that available elsewhere locally to semi-skilled staff?

At the moment Peter aims to pay all employees 10% higher than the local competitors. He believes this enables APSL to choose the best employees. He therefore monitors local pay closely, to ensure they are always paying 10% more.

The employee’s at APSL are very driven by their pay. This can be seen from them being reluctant to have fringe benefits, at the expense of a lower pay. Although this means APSL does not have to provide all the extras for them, such as the subsidised canteen, it involves them paying out a huge amount each month in wages, in order to keep them happy. Another result of this is that if APSL was to cut wages, in order to fix the current bad cash flow, then employees would get very unhappy, and could potentially cause numerous problems for the business, such as the trade unions involved, and maybe even strikes. Therefore getting rid of this policy would be difficult, and would ruin the great working conditions at APSL. However APSL could instead freeze pay over the next few years, to slowly reduce this 10% extra pay their workers have over others in the area.

APSL employees are paid in this way in order to ensure that they are able to choose their employee’s, and therefore get the best. Being able to choose employees means they are able to select those with much higher skills, and are therefore better at the job. Having better employees means APSL is able to have higher productivity, and also reduce quality control issues. However employees are only better from more experience and training. If APSL were to invest this money instead on a good training programme once, they could get the employees who are willing to work for less, and then train them up to the same standard as those better employees’ with the 10% extra. As this would also be a one of cost for the business, and not one that would occur every month or so, it would also help the business’s low cash flow situation, and help to achieve its key objective.

However this 10%, while it may seem like a small figure, makes a huge impact on the business. In the case study it states that around 40% of the businesses cost of sales in 2013 was from wages. From the values given in the profit and loss account, we can then also see that ÂŁ13,034,000 was spent on cost of sales. Therefore we can work out that the business actually spends around ÂŁ5,213,600 a year on wages alone. If the business was to not have a 10% increase on the average pay of the area, they could decrease this by up to ÂŁ473,963 and instead get nearly half a million extra in profits. This would help the business to improve their key objectives of increasing solvency ratios, and in turn dividends.

As the business has bad cash flow at the moment, the better employee’s gained by having the higher pay, is probably not worth all the extra wages APSL has to pay out throughout the year. Having the amount slightly smaller, such as 5%, would still attract most of these employee’s, and also mean that APSL was in a better finical position. They would also have more money to spend on training these employees up to a greater standard. However as the current employees are so driven by their pay, reducing this would be difficult for APSL to manage, and brings up many potential problems, such as trade unions. If APSL decided to cut wages, they would risk losing employee’s, so therefore would have to manage this change very closely, by communicating well to the employee’s, and maybe even starting to offer non-financial incentives to make the employee’s less driven by pay.

Business Studies F297 Ocr Apsl 2014 Strategic Management Revision Question

Hi. Thank you all for the feedback and support on the f297 exam questions I have already posted. A number of you have asked me to email you any handwritten ones, I will do them by the end of this week. But for now, I will continue posting new essay questions. Comment if you would like any done in particular 🙂

This question has been suggested by the APT support pack but answered by myself.

29.) Should APSL relocate to the factory in Hull in order to increase capacity (lines 107-13)? Justify your view.

Currently, APSL operates from three separate buildings totalling to 12 000 m2. Inevitably, operating from three different units is likely to cause a number of inconveniences such as a lack of efficency, frequent distruptions to production as well as poor communication within APSL. As a result, Kate proposes the idea to moving to a factory in Hull which means that APSL will be able to operate under one roof. Despite its advantages, APSL will need to effectively weigh up their decision in order to ensure that the advantages outweigh the negative impacts.

One advantage of moving to the factory in Hull is that production will become a lot more efficient. Last year, APSL was frequently faced with haults in production due to suppliers delivering produts to the wrong site out of the three. Therefore, by moving to the factory in Hull it means that even if suppliers deliver to the wrong department, it is easier to move materials around one single site rather than three. When suppliers deliver to the wrong site, it results in a domino affect impacting production as it means that APSL are unable to start production immediately and therefore could impact the business reputation even further as customers are unlikely to get products at the expected delivery time due to the production process taking place later than planned. In particular, APSL sees the “just in time” production materials delivering to the wrong unit and therefore not only will the Hull site be an easy drop off point for suppliers, but also due to the increase in capacity, the factory will now be able to store a lot more supplies in the warehouse and therefore will not need to rely on JIT production to carry out orders through having raw materials already stored in the factory.

APSL moving to Hull will also improve communication. Due to the business being in one single unit, it means that decisions can be easily passed through different departments with little confusion. For example, if an urgent meeting is to be held, this information can spread much faster and easier through one single site as opposed to the previous set up of three. In addition to this, it is likely that customers will recieve their products much faster. If APSL have one site, it means that materials can swifty shift from production through to distribution with little interruption. The move to a new single factory in Hull is likely to improve the efficency as it removes any confusion and contrusction haults in the business.

However, as with all relocations in business, APSL will face challenges. Relocating to the factory in Hull will mean that staff will have to travel a total of 80 miles from the estate in Loncolnshire to Hull and therefore APSL will need to consider HR issues. Whilst the move could derive benefits for staff, it is important that they consider the flexibility of current employees. The move will mean that some workers will have to move along with the business in order to continue to benefit from job stability. Although this may seem easy, it will be a move that staff will be reluctant to pursue due to having their own families and community back in Lincolnshire. However, another possibility is that the current staff of APSL could travel back and forth each day in order to work their shift, which will be costly for travel and petrol. The managers of APSL could decide to subsidise travel costs, which is likely to keep some employees of APSL however it may mean that the business is suffering from more disadvantages from keeping current staff rather than employing new ones. There are obvious advantages to hiring new staff to go along with the new building in Hull. This is advantageous as it is liklely that the employees that are most loyal and motivated working at APSL will be those that opt to move with the business and therefore APSL will be able to take the ‘creme of the crop’ employees that are happy with working at the business. Whilst the current employees seem satisified at their job, employing new staff will mean that new ideas and fresh minds are bought to the business. This in itself is advantagous as new employees are also more motivated to grasp the business and the way it operates, in an aim to prove their selves from the outset to managers. However, this will cause implications for APSL as it means that they will have to spend both time on money hiring new people. Hiring new staff will mean that APSL will need to train the new employees to the high quality standards that APSL place a high importance on achieving. In addition to this, APSL will need to spend adequate time in finding the right people for the job, as well as taking time to conduct interviews. It is reasonable to argue that APSL should start the recruitment process whilst still operating in the current factory, as it means that they will not have to delay the process of moving to a new factory even further and there will be employees ready and trained to begin when APSL move.

In addition to HR implications, APSL will also need to consider their current stakeholders. One important stakeholder in this move will be the local community. APSL moving to Hull will both make staff redundant in the current area whilst improving the unemployment rates in Hull. The local community of Hull will both face advantages and disadvantages when introduced to the idea of a new factory. The local community will be weary about APSL’s move due to the current issues of non-compliant parts being disposed of incorrectly and therefore causing inconvenience to members of the public seen through the complaint letter. However, if APSL do move, they are likely to bring inward investment to the area of Hull, through employing local members of the community as well as the possibility of importing materials from local suppliers. Thus, while Hull might be unsure about the pollution a new factory will bring to the area, they will need to recognise the obvious financial advantages that will be a direct outcome of a new factory.

Cost is another main factor that will dominate APSL’s decision to move to Hull. It is important that APSL evaluate whether they have the means to move to the new location in Hull as a larger property is likely to incurr more costs. One way that APSL can do this is look at their retained profits and find out if they have enough spare cash to subsidise the cost of moving. If APSL find that they do not have sufficient funds, they will have to evaluate appropriate sources of finance. However, APSL taking out loans from banks or an overdraft will mean that they will enter debt even before the move which is an undesirable outcome that will come from moving to Hull. In addition to moving factory, APSL may need to figure out if they have enough spare cash to fund the rest of it’s projects that they are also thinking of such as utilising flaxiboard as well as a heat energy saving device.

It is apparent that APSL have a lot of projects going on at once for example the possible move to Hull, using new raw materials and introducing a third time shift. However, if APSL prioritise the factory moving to Hull, the business will certainly see some benfits. In addition to increased efficiency, APSL is likely to improve communication across the business and therefore it will ultimately result in a positive impact on the business and the way it runs. If APSL have sufficient means to move to Hull, it is advised in order to gain maximum capacity and reach the best return on their investment.