1、GU.11 (a)Product mix means that the full set of all products offered for sale by a company. From the case, it shows that the product width of product mix of Barrs is not wide enough. So:Advantage:The Barrs product mix is very simple and specialized which likes the operational activities. Barrs just
2、only operates in the drinks market. However, the company has great subsection of products, and there are many product lines and items in it. Moreover, with the edgy humorous theme advertisement, the products of Barrs are well-known in many places.In the case, Barrs produces many different brands, su
3、ch as Irn-Bru, Tizer, Simply Citrus, Simply Clear, etc. It also operates the UK franchise for Orangina and for Lipton Ice Tea. For its products, Barrs uses the advertisement to maintain an up-to-date image. This will help Barrs to gain economies of scale in promotion and operation, and build manager
4、ial expertise.To gain the profits, a number of different markets are targeted by the company. The product lines and items of the company have various focuses. For example, Tizer aims at the market of 13-15 years old boys. And Orangina aims at the market of 18-30 years old people.Disadvantage:Most pr
5、oducts of the Barrs are at the maturity stage. According to the case, for example: Irn-Bru is one old brand, it over 100 years old, it is up against the decline stage.Soft drink is one of rapidly changing markets; so many companies will be durative to research, and then put out new brand of drinks.F
6、rom the case, Barrs is very hard to set up a new brand, because its own brands such as Irn-Bru are accepted abroad very well. The company is not able to develop its own brand.While, Orangina, one franchise agreement, is not in a steady market, and the Lipton Ice Tea is just in the introduction of it
7、s product life cycle in the UK.(B).Price elastic, which is known as elastic demand, means the quantity demanded will change by larger percentage than price. That is to say, price elastic is much more sensitive than price.Price elasticity would influence the brand loyalty of Barrs, so Barrs need to i
8、mprove its brand loyalty, which could makes price elasticity less sensitive. This will affect price changing on sales.According to the case, Barrs uses advertising to maintain an up-to-date image for its products. Barrs tries to build brand share and brand loyalty, Barrs uses different strategies to
9、 market its Price Elastic Products and increase its promotion activities. Here is an example: in 2003, free Irn-Bru samples were given to concert goers at events in England by sales people who arrived in Irn-Bru Scooterettes - scooters in Irn-Bru colors. This type of guerilla campaign was also used
10、successfully in 2002.One more: During 2002, Tizer, in conjunction with Alcan, ran a campaign in conjunction with schools whereby containers are provided in schools for recycling. Nearly 250 schools participated in the scheme which offered prizes including musical instruments.2. Competitors behaviour
11、 depends on market characteristic, which includes competitors and oligopoly.For one market, the total demand of market is fixed, and the competitors have a number of the market shares. So the impact of main competitors is very important to Barrs. That is to say, competitors also want to attract the
12、same range of customers.Because of the fixing total demand of market, they could rely on some extent others in the industry to help its overall growth. So Barrs have well activity to confront the external environment. Barrs uses a range of promotional activities to make considerable use of advertisi
13、ng. It is a vital part in maintaining an up to date image for its products, particularly as carbonated soft drinks, most of them are bought by young people.Barrs is proud of its reputation for using innovative tactics alongside tried and tested methods. But there are some complaints to the advertisi
14、ng standards authority. However, the Advertising Standards Authority (ASA) did not uphold the complaint. They agreed with Barrs view that the advert was intended to be humorous and that the idea in it was meant to be ridiculous and not to be taken seriously. The ASA considered that the claim would b
15、e regarded as nonsensical humour. The company has the particular advertising which is be famous for the most people. Most of the customers are interested in the advertisement.Barrs tailors its advertising and promotional activities very closely to the situation of the brand involved. A significant f
16、actor was the help obtained by Barrs from government agencies, particularly Scottish Trade International, which is responsible for encouraging Scottish based companies to export. The goods of the Barrs that they sell abroad give an income into this country. And exports must be added on, so the gover
17、nment of Russian always help the company to acquire the good income. However, the Russian economy collapsed, and despite a successful advertising campaign in 1999 essence sales to Russia in 2001 fell. Because Barrs began exporting Irn-Bru directly to Russia in 1994 when the market opened up to weste
18、rn firms after the fall of the communist regime. Previously, goods like soft drinks were not readily available and awareness of all brands was low.In February 2002, Barrs concluded a new franchise agreement with the Pepsi Bottling Group, the largest franchise bottler for Pepsi-Cola in the world. Irn
19、-Bru is produced at its bottling plants in Russia and is distributed through PBGs extensive distribution netword. This arrangement seems to be working well: at the end of its first year, in 2003, Irn-Bru sales accounted for almost 1% of the Russian market.In addition, the company has changed promoti
20、onal methods to make use of the internet. For example, Barrs has gained exclusive rights for the provision of drinks at tourist attractions in Scotland, such as the Falkirk Wheel and the Lomond Shores development at Loch Lomond. Tizer has sponsored the ITV show. It has developed special characters l
21、ike Ed the Head who have become associalted by consumers with the product. This sponsorship is regarded as particularly efficient as this TV show has the greatest proportion of the target market viewing at any one time. 3. (a) The stakeholder is any group shares of the interest with the company. The
22、 company of Finsbury Growth Trust plc has the shares of 4.01%, so the company is the stakeholder. The stakeholder include the governments, suppliers and employees. The information which it needs will depend on its organisational goals, and they should know they can take which level of degree of risk
23、. In the case, we have no idea of the objective of the company, so it is hard to say which information will be valuable for the stakeholder. But according to my idea, the following information will be interested: 1. The investment of the new machinery. It can arouse a large cash outflow, so that the
24、 capital will be influenced. 2. They will also be interested in dividends. Because this will influence earnings that it gets and how much it can pay its unit holders. For the Barrs, the dividends are steady. 3. The promotional campaigns are paid attention. It will influence demand for products, grad
25、ually influence the achievements. 4. Another piece of information is the franchise agreements. It will influence the Barrs earnings when they start and end. 5. They will take care of the complaints made to the advertising Standards Authority. It may affect the demand for Barrs products. (b)The main
26、users of financial statements will use financial information to assist decision-making. Users of financial information can be split into 2 categories: internal and external users. Internally, management and employees study the information provided by the financial and management accounting statement
27、s. Existing shareholders, who will check the companys performance, are also considered internal users of financial information. According to the case, the shareholder is the external user, he will receive a share of any profits in return for the investments. Shareholders are primarily interested in
28、the value of their shares and the return on their investment. They will use this information to help decide whether to remain a shareholder in this business or to sell their shares and invest elsewhere. Profitability ratios will be of ultimate interest to shareholders, in particular, it is a ratio k
29、nown as return on capital employed. Barrs managers are internal users, they will use the accounting information to compare performance. They will use all sources of financial information. In the case, I will choose the profit after tax, which could meet the requirements of each of the two companies.
30、 The profit after tax is the revenues minus the expenditure, and then minus the taxation, this part is the profit after tax.As the shareholder, there are some advantages to measure it:1. It could be used to monitor whether it has invested in terms of its objectives, these may relate to companies whi
31、ch have stable earnings. 2. Whether its previous share purchasing decisions should be reviewed. 3. Whether its a suitable share profile among several companies could be implemented. It can be seen as the bench mark to scale the investment of the company. 4. The measure also can reconsider whether it
32、 is suitable for investment. If the profit after tax is not so good, the company is able to sell the shares. As the Barrs, it could use it to monitor the year to year progress of the company. And it also can monitor the effectiveness of its profit sharing schemes. 4. According to analyse the case, B
33、arrs already has three partnership agreements, such as those with Pernod Ricard, with Unilever in the UK, and with Pepsi in Russia. If Barrs concludes another partnership agreement with another company, these are maybe several advantages and disadvantages.Advantages:The company has a long-standing a
34、im that is about increasing the sales of southern border. Sales there have been rising, while comparing with the sales in Scotland the quantity is still very low. So Barrs has to change its marketing mix, the company extends its product lines and items, which could help the company to get much more
35、profits, and gain larger market share. Branding is highly significant in the soft drinks market. It means that companies should have adequate funds spending on propagandizing their products, and most of customers who have purchased are full of satisfaction. At the same time, they have to be able to
36、produce in sufficient quantities to gain economies of scale in production. The company want to enter the French market to open up new markets, so that Barrs could acquire further profits. Moreover, Barrs wants to promote its production to abroad for being a well-known company.These partnership arran
37、gements, known as franchise agreements, normally last for a specified period of time such as five years. Barrs has the UK franchise for Orangina and for Lipton Ice Tea. Disadvantages:Concluding a new agreement, Barrs should get more capital to support the promotional activities on new products. And
38、one more problem is building own brand. In the case, Barrs uses the advertisement to maintaining brand awareness, which is as a vital part in maintaining an up-to-date image for its products. This should cost large number of capital. Advertising and promotional activities are used for growing and in
39、creasing the famous level of a new brand. Barrs may change attention from efforts to building its own new brands such as Simply Citrus.However, Barrs is still a small company, and its resources are too thin for spreading, so Barrs should be overstretched. In the case, Barrs just operates the drinks
40、market, so Barrs could beat into some other areas of markets, such as selling furniture, selling electrical machines, etc. 5. Barrs has clearly forms of structure. Now I will analyse the structure from finance and marketing. The Barrs only have one horizontal hierarchy. The hierarchy is an integrati
41、ng and coordinating device intended to bring together among the activities of individuals, teams, groups and departments. The company has clear roles and responsibilities. Barrs controls costs of raw materials, like sugar, it is through rigorous procurement and purchase methods. Finance uses to main
42、tain and control on costs. While marketing is about creating an impact, finance may be able to adjudicate between spending in demands of operations and in marketing. Barrs is traditional company with traditional values and this may fit well within a traditional structure. The traditional organisatio
43、nal structure is a less effective structure.Analysing the case, if Jonathan Kemp, the Director of Market Department, wants to do some promotional activities and advertising, it is hard to get enough money, because it will conflict between Finance and Market. Finance Department maintains on cost, and
44、 adjusts spending demand. In soft drink market, marketing is expensive. And Finance maybe could provide the capital. Under such structure, it is hard to be changed. The appointment of two new young directors, Jonathan and Roger suggests that the company may need to develop more quickly than it has.S
45、o in my opinion, a brand based structure may help Barrs to achieve its further development and ensure the organisation of Barrs appearing its commitment to brands. In such new structure, communication between Finance and Marketing will be much easier than in the current structure. A brand based stru
46、cture could help ensure funds allocated to the requirements of marketing each brand more closely.5. (A) There are several main factors affecting the demand for Irn-Bru in the UK.I. The soft drinks market is sensitive to price, in the case, owing to the value of the pound was high against the Euro an
47、d a knock-on effect, Barrs was forced to cut prices to wholesalers by 30%.II. For some products, tastes and fashion is very important. In the case, Tizer was re-launched in 1993 and in late 1996, another redesign was introduced. A further re-launch in 2003, this time it is more close to its target m
48、arket.III. Weather as one more factors, could influence the demand. In the case, in a very poor summer, in 2002, sales of soft drinks are low, so Barrs gets low profit.IV. Advertising and promotion is vital in influencing tastes, and increasing peoples awareness of Barrs products, e.g. Irn-bru spons
49、orships.(b) I. Due to the value of the pound was high against the Euro, prices of other goods affect demand of UK, and it forces reducing in price to maintain sales levels. In the case, Barrs cuts prices to wholesalers by 30%.II. Weather conditions could affect cash flow. In the case, in 2002, in a very poor summer, sales of soft drinks are low, so it reduces the cash inflow.III. Promotion could increase demand; it could help get higher sales and profits.IV. A knock-on effect on sales revenue and costs could affect profits dir
