Assignment 2 Operations Decision



Assignment 2 - Operations Decision

Introduction

Before starting a business it is necessary to do planning as it save company from failure and offer opportunity for further improvement. This should be noted that decision for the entire new business should be formulate according to business environment and market condition. This paper will focus on determining the specific details concerning the fictitious company in order to conduct an environmental scan of this company.

Discussion

1. Detail of the Fictitious Business

The company that I have decided to create is clothing company named “Red Lady clothes”. The aim of this company to offer best quality clothes to their potential customers. Red Lady clothes mission is to provide new look for young ladies that are based on new style and quality. We will be offering different range of clothing products such as women's shirts, blouses and other tops, women's pants and jeans, skirts and dresses, women's outerwear and suits, Coats, jackets etc. we will also be offering customized service to well known companies (Blackwell, 2012).

This company would be targeting ladies from 17 years to 25 years. Red Lady clothes have set certain goals with respect to sales & income and also to expand to their business overseas. Red Lady clothes would be maintaining their profit margin up to 25% for initial year while they seek to expand their operations to overseas in third year. In second year, Red Lady clothes want to increase their revenue at least by 50% along with increase in market up. Hence, Red Lady clothes want to be one of the best clothing brands not only in US but also internationally (Abrams, 2012).

2. Current Environmental Scan Factors

Company's Environmental scan factors are termed as interpretation of the social, political, economical, technological trends and events that has immediate relationship with the business along with the industry and market. Whether to continue operation of the company, there are many factors that are necessary to take into consideration. First factor is Market Analysis; this is the first task since one need to track market performance, the condition of market and demand from customers (IBIS, 2013). This market analysis shows whether company should go for this operation or not, and whether there is huge demand from customer or not. If there is such demand and market, then what factors needed to controlled and analyzed for feasibility. This comprises of seasons such as winters, summers etc. demand for clothes in such seasons differs (Blackwell, 2012).

Therefore, we need to know the demand for each season so that production can be in line with the demand and also what are the chances after seasons is off. Manufacturing Costs evaluation is another step that needed to be consider i.e. how much cost can be cut down without any forgo of the product quality. Furthermore, competition of clothing market has been increased, this should be considered while determining the production unit and sales unit (IBIS, 2013).

After this, factors that are related to profitability should be ...