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Sveta_85 [38]
3 years ago
13

Does it make good strategic sense for lvmh to compete in all of its current segments? which of its product lines — wine and spir

its, fashion and leather goods, perfumes and cosmetics, watches and jewelry, selective retailing, and other — do you think is/are most important to lvmh's future growth and profitability? should one or more of these current segments be discontinued? why?
Business
1 answer:
I am Lyosha [343]3 years ago
3 0

goods, in that also specially bags where it enjoys a king like status. At one hand having varieity in segments helps to be survive in the market when the economy is down and there are steep falls in purchasing of products by consumers. On the other side its get difficult to maintain various products as costs are associated with each. We can take cue from that Vuitton's ability to offset the steep falls in other divisions shows the value of the diversified conglomerate model in luxury goods. Richemont, the industry's second-largest company, has a less varied portfolio and greater exposure to watches and jewellery, demand for which has been especially weak.

Since the customer segment is also changed in recent times and mostly 60% of the revenues coming from middle class. Also the growth and demand for luxury products now coming from the developing countries from Asia where luxury goods are a new style statement and way of showing how prosperous one is.

If we see sales and margin of different segments in LV then we can clearly see that watches and jewelry are not only low in revenues but also in profits too while wine and spirits are good in margin despite having low sales. so its not wise and doesn’t make strategic sence to compete in all of current segments but one factor which is due to new markets like Asia where people are buying watches and jewellery if its associated with LV so one should take care of that in mind also

Out of its Wine and Spirits, Fashion and Leather Goods, Perfumes and Cosmetics, Watches and Jewelry, Selective Retailing, and Other we think that fashion and Leather goods is most important for LVMH’s future growth and profitability as we can see that LV is very much strong in that area and it has got some USP to lead in that . Beneath the gloss of advertising campaigns, catwalk shows and each season's fleeting trends, Vuitton brings a machine-like discipline to the selling of fancy leather goods and fashion. It is the only leather-goods firm, for instance, which never puts its products on sale at a discount. It destroys stock instead, keeping a close eye on the proportion it ends up scrapping.

Also Unlike most other luxury marques, Vuitton never gives licences to outside firms, to avoid brand degradation. Its factories use techniques from other industries, notably carmaking, to push costs down ruthlessly and to allow teams of workers to be switched from one product to another as demand dictates. It has adopted methods of quality control, too: one quality supervisor came from Valeo, a French auto-parts supplier. The result is long-lasting utility, beyond show, which is valuable in difficult times.

So we can say that it enjoy its brand position in this segments due to its own manufacturing and innovative ides and very active participation in the fashion and other relevant events.

Yes, as i mentioned above that watches and jewellery is the segment which is lower revenues and lower margins as well. In this segments things are changing rapidly specially in watches where techniques becoming more important day by day. And to mentioned another important point is that there are so many competitors in the markets apart from global to local that it becomes very difficult to penetrate in the growing market like asia and others. Also for traditional upper class there are many brands like Tag huer among others which make sense for them to choose one over LV products. So its like watches of Tag, Suit of Aramani, shoes of Jimmy choo and Bag or leather jacket of LV. So one thing which LV can do about its watches and jewelary segment is that it can associates its new customers like Asians with its LV brand to increase sales in this segment however there is a fear that it will impact its fashion and leather brands in negative sense.


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stealth61 [152]
The correct answer would be : training employees on quality management
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5 0
3 years ago
If your company’s product is mobile phones, do you think it would make better strategic sense to employ a multidomestic strategy
Blababa [14]

A global strategy would be appropriate since most mobile phones are constructed to work globally and buyer needs across the world are relatively universal.

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4 0
2 years ago
At December 31, 2017 the following balances existed on the books of Beerbo Inc.: $1,200,000 BONDS PAYABLE $168,000 DISCOUNT ON B
Mazyrski [523]

Answer:

bonds payable     1,200,000

interest payable        30,000

loss on redemption 162,000

                  cash                            1,224,000

                  discount on bonds        168,000

to record redemption of the bonds at 102

Explanation:

To know the gain or loss on redemption we will compare the cash disbursement wiht the carrying value fo the bonds

the vbonds are rescue at 102 which means 102% of the face value:

1,200,000 x 102/100 = 1,224,000 cash disbursement

<u>carrying value of the bonds:</u>

1,200,000 - 168,000 discount + 30,000 interest payable = 1,062,000

loss on redemption: 1,224,000 - 1,062,000 = 162,000

we will write-off the bonds related account and credit cash by the amount paid.

8 0
3 years ago
Monte’s Coffee Company purchased packaging equipment on January 5, 2014, for $90,000. The equipment was expected to have a usefu
Igoryamba

Answer:

1.a

2014 Depreciation

Straight line method $28,000

Units-of-output $37,380

Double declining balance $60,000

2015 Depreciation

Straight line method $28,000

Units-of-output $29,820

Double declining balance $20,000

2016 Depreciation

Straight line method $28,000

Units-of-output $16,800

Double declining balance $6,667

1.B Total Depreciation in 3 years

Straight line method $84,000

Units-of-output $84,000

Double declining balance $86,667

2. Double declining balance yields the highest depreciation expense for 2014

3. Double declining balance yields the highest depreciation expense over the three-year life of an equipment

Explanation:

1.A In computing straight line method, the formula would be:

(cost of equipment - salvage value) / life of equipment

2014

(90,000 - 6,000) / 3 years = 28,000

2015

(90,000 - 6,000) / 3 years = 28,000

2016

(90,000 - 6,000) / 3 years = 28,000

TOTAL DEPRECIATION IN 3 YEAR LIFE OF EQUIPMENT = $84,000 ($28,000 + $28,000 + $28,000)

UNITS-OF-OUTPUT METHOD

Formula: (Cost of equipment - salvage value) / total operating hours of equipment x operating hours used for the year

2014

($90,000 - 6,000) / 20,000 x 8,900

($84,000 / 20,000) x 8,900

$4.2 per hour x 8,900 = $37,380

2015

($90,000 - 6,000) / 20,000 x 7,100

($84,000 / 20,000) x 7,100

$4.2 per hour x 7,100 = $29,820

2016

($90,000 - 6,000) / 20,000 x 4,000

($84,000 / 20,000) x 4,000

$4.2 per hour x 4,000 = $16,800

TOTAL DEPRECIATION IN 3 YEAR LIFE OF EQUIPMENT = $84,000 ($37,380 + $29,820 + $16,800)

DOUBLE DECLINING BALANCE

Formula: 100%/life of equipment x 2

*residual value will not be considered in this method of computation of depreciation expense.

2014

100% / 3 years x 2 = 66,67%

90,000 x 66.67% = $60,000

2015

100% / 3 years x 2 = 66,67%

$90,000 - $60,000 = $30,000

$30,000 x 66.67% = $20,000

2016

100% / 3 years x 2 = 66,67%

$90,000 - ($60,000 + $20,000) = $10,000

$10,000 x 66.67% = $6,667

TOTAL DEPRECIATION IN 3 YEAR LIFE OF EQUIPMENT = $86,667 ($60,000 + $20,000 + $6,667)

2. Double declining method yields the highest depreciation expense in 2014 in the amount of $60,000 as computed above.

3. The method that yields most depreciation over the three-year life of an equipment is the DOUBLE DECLINING METHOD in a total amount of $86,667.

8 0
3 years ago
Tony is facing a financial crisis in his business. Instead of applying for a loan from a commercial bank, he takes a loan from t
Paraphin [41]

Answer:

credit union

Explanation:

A credit union can be regarded as

not-for-profit financial institution which is under control of the members who has money deposited in it. It doesn't maximize profit but rather give back favorable interest rates to it's members as profit.

7 0
3 years ago
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