Global organization in Europe Essay Example | Topics and Well Written Essays - 2000 words

Global organization in Europe - Essay Example In the body care section the company holds the top position in the European bath and shower market, in households side they are having one of the world famous shoe polishes named Kiwi. The company is trying to settle the market of branded apparel, which includes men's and boy's wear, also sports wear. The thing that should be kept in mind at this stage is that the Sara Lee is making most of those products in which brand switching is common, and there are relatively very few differences between the competitor's products and the company's products, for example the shoe polish Kiwi is having competition with Cherry Blossom, if a consumer would go to buy Kiwi and would not find it in a shop, he would buy cherry blossom rather than going to an other shop and look for Kiwi, this brings us to Imperfect Competition, according to Lipsey (1997): This is the commonest characterization of real markets. Imperfectly competitive markets often involve products that are similar but not identical and for which there are a finite number of potential producers, each of which can influence the others by its own behavior. (p. 11) So this implies that the competitors do the first impact on trade, it means that the company has now to think about the sales quotas and forecasts, more specifically how much would they produce in the future so that there is also the minimum level of goods return and maximum levels of profit can be achieved, the next most important thing is the structure, nowadays the companies are having multiple products, so what they should know is how to maintain the product line and length as a product can damage the other products of the same firm in terms of sales and value. "Firms are trying to make the best use of available resources and this is an optimization problem familiar in economics. Issues of optimal employment, investment, and structure are all susceptible to economic analysis"(Lipsey, 1997). After wards there are more things to worry about, like the growth rate of GDP should be kept in mind as if any company that is low in demand or even having an exceeding demand can put some im pact on GDP, Like in case of Sara lee the food production depends on the past sales records, else at times the senior executives take decision when they have to enter in some new market, specially it creates a lot of fuss when new product is to be launched in some area, it has a lot to do with investment not only in production but also in conducting research so that the chances of product failure can me minimized. The biggest advantage of having such operating organization in UK is that the local goods are promoted, it means that more the local goods are used the less the country relies on import, reminding that the company is still local, and the goods are not imported in the case of Sara Lee, the production of goods is done by the firms that are being operated with in UK by taking the license from the main Sara Lee Corp. Another good advantage of this organization is that the competition between Sara Lee and other firms is maintained, reminding that competition is something in whi ch the customers get the benefit as an outcome, a good example