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Financial Analysis

Essay by   •  April 25, 2012  •  Essay  •  526 Words (3 Pages)  •  1,897 Views

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Strategic Issues Of TBC

Investing in the new machinery could offer many strategic benefits to the organization. The decision of purchasing a new AL 2 can help the company strengthen its company's brand name and profile. According to the market research of TBC, the AL2 cranes would take over the market in the next few years. It is in TBC's best interest to invest in this new technology so that they can stay ahead of the game. In today's market companies have to think beyond the point of survival, the competition is so fierce that they will have to update their products/services regularly.

This investment will make them stand out of crowd and help them build strong business relationship. It will gives their clients/contractors confidence and with excellent service provided they may even win their recommendation. It is a well-known fact that nowadays word of mouth offers huge opportunities to business. It is the most effective way of developing business as it brings its potential clients/customers to them. Recommended companies are highly valued compare to companies that are advertised by other mediums.

The new equipment will not only increase production output it will be efficient enough to deliver its duty with power and perfection .It has a bigger capacity and would be able to pick up larger loads. This new change will help them get larger projects in future and also improve their chances of winning bids of bigger contracts. This will as a result increase the company's profits as equipments of latest models have high rate of return. In today's competitive market businesses are comfortable to put their trust in clients/suppliers who have the latest and the best equipments in the industry.

This investment will not only save the company from breakdown cost but it will save them the time and hassle of repairing and delays of projects. One break-down on a construction site can cause company severe cost and damages. It will not only have to pay for the repairing but also become liable for other costs due to delays in completing the project for example, labor and other. In the long run it will cost the business in decreased profitability, as the clients will lose their trust and it will create poor business relationships. Hence the company will earn lesser contracts and will build a bad reputation in the market.

TBC needs to recruit the right management team in order to make better decisions for investments. Managers like Henry Morton keeps up to date information on innovation and new technology in the construction industry. So far the current managers like Ideal management team would be those have their eyes on opportunities are quick to move in new business areas. More importantly they must be comfortable with their roles, in other words they should have the knowhow and expertise to do their job effectively. Companies can enjoy their success even in the



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