Business Ratio Essay Example for Free

Business Ratio Essay The profit margin is mostly used for internal comparison. Individual businesses operating and financing arrangements vary so much that different entities are bound to have different levels of expenditure, so that comparison of one with another can have little meaning. Digi has a highest net profit margin ratio among the 3 company which is 21.03%, while Axiata and YTL have 14.26% and 7.87%. YTL with a lowest profit margin indicates a low margin of safety: higher risk that a decline in sales will erase profits and result in a net loss. Profit margin is an indicator of a companys pricing strategies and how well it controls costs. Differences in competitive strategy and product mix cause the profit margin to vary among different companies. Liquidity ratio (current ratio) The current ratio is an indication of a firms market liquidity and ability to meet creditors demands. Acceptable current ratios vary from industry to industry and are generally between 1.5 and 3 for healthy businesses. Axiata and YTL have a current ratio that is 1.1632 and 1.3149 is near to this range, it generally indicates moderate short-term financial strength. Digi has a current ratio that below 1, the current liabilities exceed current assets. Digi may have problems meeting its short-term obligations. Low values for the current ratios indicate that Digi may have difficulty meeting current obligations. But if inventory turns over much more rapidly than the accounts payable become due, then the current ratio will be less than one. This can allow Digi to operate with a low current ratio. Leverage ratio (Debt ratio) YTL debt ratio is 0.7403 which is higher than Axiata and Digi which is 0.4826 and 0.7098. The higher the ratio means the greater risk will be associated with the firms operation. In addition, high debt to assets ratio may indicate low borrowing capacity of a firm, which in turn will lower the firms financial flexibility. The debt ratio shows the proportion of a companys assets which are financed through debt. The ratio of Axiata is less than 0.5, most of the companys assets are financed through equity. Companies with high debt ratios are said to be highly leveraged, not highly liquid as stated above. Digi and YTL with a high debt ratio could be in danger if creditors start to demand repayment of debt. Activity Ratio (Total assets turn over) Asset turnover is a financial ratio that measures the efficiency of a companys use of its assets in generating sales revenue or sales income to the company. Companies with low profit margins tend to have high asset turnover, while those with high profit margins have low asset turnover. Digi has a profit margins which is 1.193times is much higher than Axiata and YTL, 0.4182times and 0.3892times. These show that Digi has a high asset turnover while Axiata and YTL have low asset turnover. Companies in the retail industry tend to have a very high turnover ratio due mainly to cutthroat and competitive pricing. Market Ratio (Earnings per Share ratio) Earnings per share are the amount of earnings per each outstanding share of a companys stock. In the United States, the Financial Accounting Standards Board (FASB) requires companies income statements to report EPS for each of the major categories of the income statement: continuing operations, discontinued operations, extraordinary items, and net income. Axita has the highest market ratio which is 28sen out of every ordinary share. Digi and YTL have lower market ratio, 16.1sen and 11.53sen. Compare with Digi and YTL, Axiata has the highest market value. Axiata earn 28sen out of every ordinary share. Days Sales Outstanding (DSO) Ratio Day sales outstanding are a calculation used by a company to estimate their average collection period. It is a financial ratio that illustrates how well a companys accounts receivables are being managed. The day’s sales outstanding analysis provides general information about the number of days on average that customers take to pay invoices. YTL has higher DSO ratio, 72.72days can indicate a customer base with credit problems and is deficient in its collections activity. Digi and Axiata which have a lower ratio, 27.96days and 46.74days may indicate that firms credit policy is too rigorous, which may be hampering sales.

Ethics and Corporate Responsibility: Accounting Fraud

Ethics and Corporate Responsibility: Accounting Fraud The key issued described in the suit against Xerox Corporation is that Xerox had overstated its revenues during the past four years by almost $2 billion. The fraudulent scheme had misled investors about Xeroxs earnings to polish its reputation on Wall Street and to boost the companys stock price. These accounting fraud cases show us that ethics is a real issue, a very current issue and it is one that needs to be addressed. Unethical behaviour is common and reasons exist for such behaviour. Recent accounting scandals involving high-profile companies such as Xerox Corp have called into question accounting practices and undermined public confidence in the profession. These ethical scandals in the real world suggested a market economy being out of control and raised demands for more stringent and effective government regulation. Such deception by management hampers the ability of the users of financial statements from gaining accurate business information for decision-making and leaves their interests unprotected. 2.CASE DISCUSSION a)What are the ethical issues confronted in these cases? The term ethics refer to a system or code of conduct based on moral duties and obligation that indicate how we should behave; it deals with the ability to distinguish right from wrong and the commitment to do what is right. Unethical behaviour in the corporate world is political and business scandals, which arise with the disclosure of misdeeds by trusted executives of large public corporations. Such misdeeds typically involve complex methods for misusing or misdirecting funds, overstating revenues, understating expenses, overstating the value of corporate assets or underreporting the existence of liabilities, sometimes with the cooperation of officials in other corporations or affiliates. For Xerox Corp. it has been defrauding investors since 1997 till 2000. In a scheme directed and approved by its senior management, Xerox falsely portrayed itself as a business meeting its competitive challenges and increasing its earnings every quarter. Xerox knowingly or recklessly increased revenues and earnings by accelerating the recognition of revenues through mostly non-GAAP accounting actions, overstated its earnings by using so called cookie jar reserves and interest income from tax refunds, disguised loans as asset sales and manipulated its accounting in violation of generally accepted accounting principles (GAAP). All of them should have been disclosed to investors in a timely manner because, singly and collectively, they constituted a significant departure from Xeroxs past accounting practices and misled investors about the quality of the earnings being reported. Besides that, senior Xerox management reaped over $5 billion in performance-based compensation and over $30 million in profits from the sale of stock. The practices summarized above constitute an unlawful scheme by Xerox to defraud investors through undisclosed accounting practices and other material transactions, some of which the company knew or should have known violated GAAP. Xerox failed to tell investors that these actions were the reason Xerox met or exceeded consensus earnings estimates quarter after quarter. b) The possible reasons or factors that may cause the unethical actions in the cases. The ethical issues faced by Xerox corp can be explained from a personal, organizational and systematic level and it possible reasons why they commit unethical actions. Personal Level Possible reasons: Individual moral failures and greed Personal level calls for the character evaluation of the main individuals that participated in the various fraud as for Xerox Corp Former Chairman and CEO, Paul Allaire, Former Chief Financial Officer, Barry Romeril and KPMG partner, Michael Conway, in a statement reported that they are the main person whom in charged by the SEC way back years of 1999. The values and ethical behaviours of these individuals have continuously been called into question. Many of the charges directed towards these individuals are a clear indication of acquiring personal interest. It is not that the senior executives did not receive any ethics training earlier on but it is their own individual moral failures and greed that led to the distortion of financial statements. They did not consider the social implications of their unscrupulous decision on their company and also all parties with interests in the company. What concern these executives are their own individualized interests especially in wealth maximization. Organizational Level Possible reasons: The need to follow orders from bosses and pressure from top management on their accountants to make the numbers add up. An unethical practices by the Top management to ensure that the accountant of the Corporation to make up the financial statement reporting to reflect the corporation financial position was on a good position no matter what it cost as long as they can manipulate the treatment of accounting practices. This might be the reasons for the accountant in that organizational tied up( unable to perform as an independent parties) with the mislead accounting practices in order to follow the command of the superior management. As in Nicor Energys overstated unbilled revenue by approximately $4.5 million for 2001 was a collusion between Johnson (senior-most financial officer) and Stoffer (NEs President CEO) in inflating the unbilled revenue number. Stoffer also directed a reversal of a portion of the incurred expense of 2001 into 2002 to meet year-end earnings targets. Besides that, Johnson who was responsible for setting the level of the bad debt reserve was under pressured by Stoffer to purposely understate the bad debts reserve. Systematic Level Possible Reasons: Cosy relationship the firms have with their corporate clients and Enormous pressure from Wall Street investors to keep up short term earnings. As been spell out, many external factors have contributed to the confront of this unethical issues. Such possible factors from the external forces are Corporations often hire accountants and other personnel from their auditor and accountants and much of the pressure brought to bear on accountants; stems from the cosy relationships the firms have with corporate clients. As for Xeroxs auditors, KPMG kept silent when it found out about the accounting discrepancies in Xerox so that they can maintain their relationship and businesses with Xerox. There was no watchdog ( legal and structure) at Xerox. KPMGs bark sounded no warning to investors; its bite was toothless. Beside the possible causes that might led them to commit in these unethical actions possibly might be due to the investment climate of 1990s added insults to injuries. Cited back, year of 1990s, Companies that failed to meet Wall Streets earnings estimates by even a penny often were punished by significant declines in stock price. In addition, compensation of Xerox senior management team depended significantly on their ability to meet increasing revenue and earning target. c).Who were the stakeholders (individual or groups) that are affected by the unethical actions? How are they affected by the fraud or unethical actions? Stakeholders are those groups who can affect or [are] affected by the achievement of the firms objectives. Stakeholders in a company may include shareholders, directors, management, suppliers, government, employees and also the community. The unethical actions in Xerox Corp have affected the stakeholders in a way or so. Shareholders Shareholders are invariably the first victims of top management fraud. When news of fraud by a firm becomes public knowledge, it immediately reduces the stock market value of the companies involved. Bondholders and other creditors of the firm can also end up bearing the negative effects of management fraud. After news of the financial fraud at Xerox Corp. is released, Xeroxs stock has been declining sharply and is now trading at about $7. Shareholders can no longer assume that management is acting within the law or with their best interests in mind. Shareholders now require greater openness on the part of their senior managers. Society Fraud also depresses the overall moral climate in a society. It can lead to a general lack of faith in the integrity of senior managers, erosion in the confidence in the free market system, including its political institutions, processes, and leaders, and a general growth of cynicism in a society. The failure of accounting firms to detect managerial fraud has also led to less faith in audited financial statements. Worse still, many believe that the accounting firms have compromised their own integrity because of the lure of lucrative consulting contracts from firms they were auditing. In Xeroxs case, their auditor, KPMG complied with management at Xerox to allow the accounting irregularities to continue. Employees Employees of companies whose top managers engage in fraud often are hit the hardest, even when they are unaware of their executives illegal activities. Fraud can cause employees to lose their jobs, their retirement savings (which often are tied up in company stock) and their reputations. Frequently, the very fact that employees have worked for a fraudulent company taints their resumes to the point that some find it difficult to find jobs elsewhere. The negative impact of Xeroxs fraud was that Xerox has laid off thousand of workers in the past two years and may make further retrenchments in the future. d) Discussion on the governance and control issues arising from the companies experienced. The highly visible accounting scandal in Xerox Corp showed us one significant matter; the corporate governance and internal controls is failed in the corporations. The worst incidences of fraud are usually committed by insiders, among whom those executives figure prominently who are assigned to manage and control their organizations. Corporations are now looking at how they can make their respective boards of directors more effective. Xerox Corp, has made a good progress on corporate governance and control issues arising from the companys experience. They have adopted strict new guidelines on what constitutes director independence. Applying this definition, 75% of their directors are independent. Proactively integrated Sarbanes-Oxley Act and proposed NYSE rules into their governance processes. Revised and strengthened the charters for their Board of Directors committees. Hold regular executive sessions of outside directors without Xerox management present. Launched a massive effort to strengthen internal controls, train their people and promulgate a clear and strong Code of Conduct. Established an Ethics Help line for their employees and have taken other measures all aimed at making Xerox a role model in ethical behaviour. Bear in mind that, no laws or policies will ever be sufficient to end all corporate misbehaviour. We are confident, however, that truly independent and inquisitive boards of directors will provide the best safeguard against corporate wrongdoings. such Audit Committees must be autonomous and vigorous, Financial Information is inherently judgmental ,give Sarbanes-Oxley a chance to work, excessive executive compensation can be tamed by the Compensation Committee and directors must be selected and appraised by Independent Nominating Committee. 3.Conclusion Fraud had damages the reputations of the individuals and firms involved. Revelations of top management fraud have caused the public to question the ability of boards of directors to monitor senior executives and protect shareholders wealth. As for Xerox Corp, in order too minimize the harm caused by the unethical actions by the executives, firstly Law and regulations are, and will remain, the most influential external drivers of corporate ethics, but legislation is no substitute for the presence of leaders who support and model ethical behaviour. The single most important ethical leadership behaviour is keeping promise, followed by encouraging open communication, keeping employees informed and supporting employees who uphold ethical standards. Corporate leaders need to communicate ethical values throughout the organization, but they must do more than talk the talk in order to establish and sustain an ethical culture. As for specific programs and practices, a corporate code of conduct is viewed as being most important to prevent or minimize accounting frauds. Such a code must reflect and reinforce the values and principles of an organization. Besides that, ethics training for all members of the organization, corporate social responsibility programs, ombudsman services and help lines can be done to combat unethical behaviour. In summary, employees need to have a code to set the ethics foundation, training to help people truly understand it, and programs that permit them to inquire about and report ethical violations. A comprehensive Whistleblowers Act to provide wide-ranging protection for whistleblowers in all sectors too can help encourage whistle blowing. Study Of Knowledge | Empiricists Vs Rationalists Study Of Knowledge | Empiricists Vs Rationalists The dispute between empiricism and rationalism begins within epistemology, the study of knowledge. Epistemology attempts to answer the questions: what is knowledge?, what can we know?, and what is the difference between opinion an knowledge? The study of knowledge began in Greece with the Pre-Socratic thinkers, as far back as the sixth and fifth centuries B.C.E. Zeno, a Pre-Socratic, is the first thinker to bring about the two schools of philosophy, rationalism and empiricism, which would grow to become a popular focus among other philosophers. Rationalism is defined as the epistemological view that true knowledge is derived from reason and from within the mind. This school of thought is based off of the a priori: truths that can be known independently of observations, and innate ideas: ideas believed to be present from birth. Empiricism, on the other hand, is the view that true knowledge is derived from sense experience. Empiricists believed that a priori and innate ideas were none existent, and rather all significant knowledge came from the a posteriori, the belief that truth is established only through observation. Zeno chose to focus on information derived from mathematics or rationalism, because he believed this information to be certain. He thought that information derived from the senses, or empiricism, could be deceiving. From there, the way by which we obtain knowledge continued to be argued over. During the seventeenth and eighteenth centuries, philosophers began to take sides as to what they believed was the source of knowledge. They formed two groups: the Continental rationalists and the British empiricists. In the Continental rationalist group were philosophers Rene Descartes and Baruch Spinoza. The philosophies of Descartes and Spinoza are similar because they are systematic, logical, and rational. Both Descartes and Spinoza sought a system of thought that possessed the certainty of mathematics and was free of Scholastic tradition, because they believed scholasticism could not be trusted. They thought that judgments must be made from a mathematical basis and believed in a mechanistic worldview, the real world is not the world as known by the senses but rather by mathematical physics. They were also both pantheists, which meant that they equated God with nature. Spinoza worked off of Descartes ideas from his Cartesian Method, that nothing is true unless it is clear and distinct. This idea of only believing what is certain was an idea brought up years ago by the Pre-Socratic thinker, Zeno and developed further by the Continental rationalists. The biggest difference, however in Spinozas p hilosophy was his opinion on substances. Descartes defined substance as that which can exist by itself, without the aid of any other substance. He divided the world into two kinds of substances, thinking substance (the mind) and extended substance (the body). He then divided thinking substance into the infinite thinking substance (God) and finite thinking substances. Although Descartes believed that there was only one infinite substance (God), he believed that there were many finite thinking substances, so he was a pluralist. Spinoza rejected Descartess divisions of substances and his plurality of finite substances. He did not agree with Descartess division of infinite and finite thinking substance. For Spinoza, there was only infinite substance, and no thinking substance and extended substance. Spinoza claimed that there was only one substance, infinite substance, which he equated with God. Spinoza also argued that the definition of substance makes it impossible for the mind and th e body to be distinct substances. He said that mind and body are modes of that single substance. So, Spinoza took Descartes idea of substances and built upon it, but Spinoza was a monist rather than a dualist like Descartes. The other major philosophical group during the seventeenth and eighteenth century was the classical British empiricists. The empiricists believed that all knowledge is derived from observation. Hume and other British empiricists rejected the intuition/deduction thesis and the idea of innate knowledge proposed by Descartes. Hume believed that true knowledge came from a posteriori, sense experience, rather than from a priori. A major difference between Hume and Descartes is their take on the issue of Gods existence. When the two applied their very different theories to the topic of Gods existence, they arrived at different conclusions. In Descartes efforts to doubt everything, he realized that only one thing was certain, I think, therefore I exist. Descartes concluded that God exists when he realized that if he himself is subject to doubt, he is imperfect, and cannot be the cause of his existence. Because he had an idea of perfectness, this idea must come from a perfect being, or God. However, Hume was not able to prove Gods existence. Hume built upon Leibnizs analytic synthetic distinction in creating his Humean Method. He separated ideas into three categories: analytic propositions, synthetic propositions, and nonsense. He created a set of questions that one could ask to come to the conclusion as to what category an idea fell under. In contrast to Descartes conclusions about Gods existence, the Humean method suggests that God should be placed under the nonsense category because it is not possible to trace God back to sense data. Descartes, the rationalist and Hume, the empiricist had differing opinions. However, the two philosophers are similar because they both raise very skeptical issues. Descartes idea of the possibility of an evil demon putting thoughts in our heads and Humes conclusion that the idea of God is nonsense caused people to begin questioning traditional teachings and what they had always thought to be true. New ideas like the ones presented by D escartes and Hume later caused problems because as people became more aware of these ideas, more rebellion from authority and religion began to occur. Part Two: Immanuel Kant In the Preface to the second edition of the Critique of Pure Reason, Immanuel Kant compares his philosophy to the Copernican Revolution. It is said that as Copernicus believed that all heavenly bodies moved round the sun, Kant believed he was the center, and that everything moved around his philosophy. The philosophy of Immanuel Kant was so revolutionary because he brought together rationalism and empiricism. Because of Kant, the debate between rationalists and empiricists ended, and epistemology could move forward. Kant was inspired to build his philosophy after he encountered a copy of Humes Inquiry. He realized that he disagreed with many of the issues Hume brought up, and decided to refute them. In his book, The Critique of Pure Reason, he combined the ideas of Hume and the ideas of rationalists. Kant agreed with the empiricist claim that sense experience is the source of all beliefs, but disagreed with the conclusion that those beliefs may not necessarily be true. He also disagreed with the rationalist idea that truths about what does or does not exist could be decided through reason alone. He eliminated the debate by claiming that thinking and experiencing cannot let us know how things really are. Instead, Kant asked if it was possible that we have metaphysical knowledge. He claimed that the mind analyzes the data it perceives in terms of space and time. So, space and time are not features of external reality, as the empiricists and rationalists before him believed. Kant said that in order for human beings to interpret the world the human mind imposed certain structures on the incoming sense data. Kant defined these structures in terms of twelve categories: substance, cause/effect, reciprocity, necessity, possibility, existence, totality, unity, plurality, limitation, reality and negation. These categories were characteristics of the appearance of any object in general. However, these categories are related only to human language. When making a statement about an object, that person is making a judgment. A general object, that is, every object, has attributes that are contained in Kants list of Categories. In a judgment, or verbal statement, the Categories are the predicates that can be asserted of every object and all objects.

Francesco Petrarch Essay -- essays research papers

	Francesco Petrarch, was a man held in high regards of his peers. The life in which Petrarch lived, was certainly not one of which many people could have had dealt with. A life of solitude, misplaced love and, family misfortune that was endured. But, through hard workand perseverance, loyalty to the churches which lead to good connections, he was regarded as one of the most influential persons and authors of his time. 	Petrarch was not a man with greatest of family lives. Born in Arezzo in 1304, to a family that had just been exiled from Florence, his family had to move to Incisa, Tuscany. Petrarch spent most of his childhood in Incisa. From then on, his father pushed him into the path of law. His brother, Gheredo, the most stable family figure in his life, later became a monk and throughout his life stayed in contact with Francesco. Petrarch had another brother, who died at a very young age. His mother died when he was 15 years old, which was consequently when some of his earliest works have been recorded. At the age of 22, Francesco's father passed away, which caused Francesco to attain a career. Giovanni, his son, was born illegitimately in 1337. The relationship between the two was disappointment to Francesco. He describes him as: "Intelligent, perhaps even exceptionally intelligent, but he hates books" He let Giovanni live with him till he could no longer stand the sight of him and sent him to live in Avignon, at the age of 20. It wasn't until just before Giovanni's death, of the Black Plague, did they start to write each other. Just before his sons death, Petrarch's friends though of Giovanni as a good person and wrote Petrarch about this. He never saw his son before his death but in his mind knew that he had started to get his life back together. He also had a daughter, Francesca, she gave birth to Petrarch's grandchildren one of which died during the Plague. This was of great disheartenment of Petrarch. 	Much to Petrarch's dismay he studied law at the University of Bologna and he earned his degree. Beyond the levels of his peers at an early age it was obvious the intellectual presents he had. Moving from school to school he realized that his true interests were in the ancient authors, not the law. He sought out and recovered manuscripts' Cicero, Virgil, amongst others. When his Petrarch's father found these manu... ... earth', it is this quote that shows how much he loved Laura, even though she did not return this love. 	Francesco Petrarch, was regarded amongst his peers and superiors as a powerful man. After having been sent on many missions of peace by the Archbishop. The King of France and, the Emperor of Italy trying to persuade Petrarch to join them. In his writings, Emperor, Kings wanted copies of his books, friends and other great authors desired to own and read these books as well. A man that could write about feeling he had even though they were not respected. Having gone through death and disappointment within his family. It is only fitting that a man who over came all of these obstacles, be considered one of the greatest Italian of his time. 	Bibliograghy 1. Bishop, Morris Letters of Petrarch (Indiana 1966). 2. Dobson, Susana Life of Petrarch (London 1805). 3. Einsenbichler K., Iannucci A. Petrarch's Triumphs (Toronto 1990). 4.Wilkins, E. H. Life of Petrarch (Chicago 1961). 5.Wilkins, E.H. Petrarch's Eight Years in Milan: 1353-1361 (Cambridge 1958). 6. Wilkins, E. H. Petrarch's Later Years (Cambridge 1959). 7. Wilkins, E. H. Triumphs of Petrarch (Chicago 1962)

The Black Cat and The Tell-Tale Heart :: essays research papers

'The Black Cat'; and 'The Tell-Tale Heart' Poe was a literary master with the emotions of his readers. He could make a reader feel anything he wanted to with just a few sentences. Through the stories 'The Black Cat'; and 'The Tell-Tale Heart';, he takes the reader through the emotions of his characters using writing methods that draw the reader in. His use of sentence structure and writing style allows the reader to become intimate with the character. Poe knew how the get a reader deep into the story; he could make them believe as thought they went through the deeds with the character. It is how Poe accomplishes this feat that is very interesting topic. Poe makes his characters more human than human. This allows many readers to become interested simply because they can identify with how the characters feel. Poe uses very basic human emotions like fear, hatred, anxiety and guilt to draw in audience's interests. The main character in The Tell-Tale Heart had an unnatural hatred for a physical characteristic on a friend. He 'thinks it was his eye! yes, it was [that]! One of his eyes resembled that of a vulture, a pale blue eye, with a film over it';, his blood ran cold whenever it fell upon him (106). This is something many people can identify with as many have experienced a hatred for a physical characteristic on someone they know. Just as the character did not understand the hatred but just saw this body part, far out of the control of the old man, as something to be vanquished. The simple emotions of fear and hatred put forth to the reader come through clearly Poe's writing technique. In the Black Cat, Poe's mechanism for the reader becoming intimate with the protagonist is the use of an alcohol driven rage. Many readers now and in Poe's

Gender Identity and Social Structures Essay -- Gender Socialization So

Gender Identity and Social Structures What is meant by identity? Firstly this essay is going to explore what is meant by identity. Identity is made up of individual characteristics by which a person is known. Internal factors such as physical appearance, personality, mental ability and sex would have an effect on a person’s identity. Then there are the external factors such as family, class, religion, culture, occupation and nationality which would influence one’s identity. Then, even beyond all these personal and social structures, societal opinions about gender, race, culture, ethnicity and nationality must have an impact on identity. Many attributes of identity are formed from childhood experience, adolescence, early adulthood and are ever forming. Identity can therefore be ever changing externally according to the life experiences through which a person goes through. Births, deaths, marriage, divorce, abuse, immigration, good or bad fortune for example are likely to cause change, and therefore influence change to identity. These may ultimately result in a change to the internal identity: physical, mental etc Gender identities are formed by several different factors, i.e. individual and collective; social and biological. Biologically, it would be quite easy to look at the body of a person and be able to distinguish between a male and a female, from their genitalia. A female would be identified by the absence of a penis. The problem with defining gender identity by simply using anatomical evidence is that is this day and age, we live in a society where most of our bodies are generally covered by clothing, so judgement can also be obscured by the unisex clothes that are worn by both men and women. Most of us are always manipulating our outer appearance according to the latest trends or fashion. It is more acceptable for a woman to wear clothing that is generally thought of as more masculine, but it is seldom that a man can wear clothing that is thought of as feminine. In such case where a man was to wear feminine clothing such as dresses, skirts, frilly blouses, stockings or high heels this would be known as cross dressing. Women on the other hand can wear trousers, jackets and even ties and this is considered completely normal. The same can be said for make-up and hairstyle. Traditionally, woman generally had long hairstyles and men had s... ...cupation such as hairdressing, fashion or beauty, you would dress in a more trendy fashion as you are selling an image to your clientele. The colleagues with whom you work often become a part of your social group of peers. It is more likely that people will socialize in circles of people with common occupations or similar earning power. As well as â€Å"putting food on the table, clothes on our backs and a roof over our heads†, employment provides us with a sense of worth, it feeds our pride. Someone who is unemployed, whether or not by choice, may be labeled as lazy and useless, and have a general lack of respect from society. Especially if it is not by their own choice, they probably feel worthless. Although it is now common for women to go out to work, men still see their roles as the main breadwinner. Where once that was their role, and the women stayed at home to look after the needs of their husbands and children, women are now holding down high-powered jobs, as well as still seeing to the general needs of their families. Occupation and income are both important aspects of identity, who we are, how we see ourselves, how we represent ourselves and how others see us.

Big business affects ethics in promotion Essay

Ethics in marketing and promotion activities has been disregarded in the business world today. The reason again is the big profit at stake. Because big business entails big amount of profit, promotional ethics has been undermined. This gives birth to the deterioration of promotional ethics. History has shown many promotional activities that have evolved in style as well as in form while safeguarding the basic interest of promotions which is to profit just like in the lottery form of promotions. â€Å"In the 1960s, lottery-like contests designed to publicize products through sweepstakes competitions spread rapidly. In the 19th century, every state banned lotteries—defined as competitions in which chances to win prizes were sold—to protect citizens. In 1868, Congress prohibited the distribution of lottery materials through the mail. The mid-20th century sweepstakes, however, did not require contestants to purchase tickets or products to win prizes and were thus considered legal. † (Congress, 1970) In promoting a product, it is of a general rule that one must be honest. But looking at the business world today, honesty has vanished. The promotions in the business world have been characterized by deception. Majority of the companies promoting their products are only deceiving clients for earning purposes. They want a fast disposal of their products so that their capital and profit will soon be seen. They don’t care if the product is falsely advertised, all they care about is the people buying it. This absence of honesty and truthfulness plagues the business world. A product of such untruthfulness most of the time are discussed in court where a lot of clients give their complaints. Dishonesty can also be seen in instances like a company is telling the public that the product weighs like and the product gives vitamins such as these. But in reality, all they are saying are false and untruthful. This reality is very prevalent that sometimes people see it as just normal in marketing. Being dishonest sometimes is already accepted as part of the business world. In promotions, companies never look at the quality of their products. They just focus on promoting it and deceiving the public just again for profit. Promotions then become just words of manipulating the people. They do away from the criteria that what is said regarding a product must coincide with the truth about it. But in reality, truth about the product and the quality of the product diverge in two different directions. In promotion ethics, welfare of the clients must be first and foremost bannered. The clients are the ones giving life to the business world and they are the ones using the products. Again, with the prevalence of deception, businesses view the people as only tools for a desired end. They forget that the reason they indulge in business is not only for profit but for the service to the people. The people must experience good quality service from the business world. People must be given an honest and sincere service by businesses. The glamour for money of the people makes the promotional ethics deteriorate. This is a sad reality that we face. Now, it is true that it is very hard to overcome this because most people are very much inclined with money and the power in it. The constant desire of people to gain and assimilate material things brings about all the disease in promotional ethics. These are diseases that eat every persons’ being and not only deteriorates the promotional world but also the dignity of people inside it. SUMMARY While big business becomes bigger, media will continually be challenged to hold on to their ethical standards while balancing itself on the persuasive power of business to control media decisions of what to communicate and what information to keep away from public scrutiny. As these two forces contend with each other, using each other as leverage to further one’s own interests, balancers are needed. Social responsibility and media ethics are needed to strike the balance between these two forces from using each other’s strengths in order for the other to become bigger monsters that they are. â€Å"Big business has changed the world. The global growth of corporate culture has brought with it the spread of democratic systems, increased wealth and education, and diversified local economies. But it has also created extreme degrees of exploitation, greed, and environmental destruction. † (Enlightennext, 2006) It is a matter of time when consumers finally realize that they have the power to tip the scales between big business and media and forge these two giants to adhere to their social responsibility, ethical standards in a global setting. REFERENCES: American Advertising Federation Board of Directors, March 2, 1984, San Antonio, Texas.Berlau, John. March 18, 2002. Is big business ethically bankrupt? Insight on the News Blohowiak, Donald W. 1987. No Comment! An Executive’s Essential Guide to the News Media. Praeger Publishers Bowers, Chris. 2004. Media Conglomerate Will Attempt to Swing Election For Bush http://www. mydd. com/story/2004/10/9/153537/663 Congress, House, Select Committee on Small Business, Investigation of iPreselected Winnersi Sweepstakes Promotions: Hearings before the Subcommittee on Activities of Regulatory Agencies Relating to Small Business of the Select Committee on Small Business , House of Representatives, 91st Cong., 1st sess. , Washington, D. C. , November 12, 13, and 14, 1969 (Washington: Government Printing Office, 1970). DuBrin, J. , Andrew, (February 2004). Fundamentals of Organizational Behavior. South- Wester Publication, 2004 Donaldson, T (1988). â€Å"Broadcasters Seek to Clean Up the Industry and Hope to Regulated Commercial Activities on the Air,† â€Å"Ethical Dilemnas†. Chicago, 1988 Evans, Fred J. 1987. Managing the Media: Proactive Strategy for Better Business-Press Relations. Quorum Books. Ethics and Television. November 21, 2006 from http://www. museum. tv/archives/etv/E/htmlE/ethicsandte/ethicsandte. htm Enligthennext. 2006. Can Big Business Save the World? Retrieved November 21, 2006 from http://www. wie. org/business/ Gardner, Howard and Mihaly Csikszentmihalyi, William Damon 2001. Good Work: When Excellence and Ethics Meet. Basic Books Glover, JD. 1954. The Attack on Big Business. Harvard University Press How Much Do Television Ads Cost? November 21, 2006 From http://www. gaebler. com/Television-Advertising-Costs. htm Liebert, R. M., & Sprafkin, J. (1988). The Early Window (3rd ed. )New York: Pergamon. McGuire, William J, 1986. â€Å"The Myth of Massive Media Impact: Savaging and Salvaging. † in C. Comstock (ed) Public Communication Campaigns. 2nd edition. Newbury Park CA: Sage. NBC. â€Å"National Broadcasters Meet at Chicago and Adopt Code of Ethics† New York Times (New York), March 26, 1929. Perse, Elizabeth M. 2001. Media Effects and Society. Lawrence Erlbaum Associates Smith. J. W. 1994. The World’s Wasted Wealth II, (Institute for Economic Democracy, 1994), p. 224.

Logistics Management

LOGISTICS MANAGEMENT Chapter-1 Concepts Objectives and Elements of Logistics 1. A. Introduction of Marketing Logistics B. Definition of Marketing Logistics C. Evolution of Marketing Logistics & Intl. Logistics D. Concept of Logistics E. Components of Logistics system F. Article Chapter-2 Logistics Sub-system A. Marketing Logistics B. Essence of logistics in marketing: C. Relevance of Logistics in Export Management D. Importance of Logistics as a strategic resource: E. Trade-Off Analysis F. Forms of logistics management G. Questions for Self-Analyzation Chapter-3 International Logistics A.Introduction B. Definition C. Supply Management D. Incoterms E. International Packaging Issues Chapter-4 Integrated Logistics A. Introduction B. Network Design C. Information Location Redesign D. Transportation E. Inventory Warehousing, Material Handling, and Packaging F. Integrated Logistics Inventory Flow G. Information Flow Hospital's Cure for Inefficiency H. Barriers to Internal Integration CHAPT ER-1 Concepts Objectives and Elements of Logistics 2. Definitions of Logistics Logistics is new unique, it never stops! Logistics is happening around the globe 24 hours days Seven days a week during fifty-two weeks a year.Few areas of business involve the complexity or span the geography typical of logistics. Logistics is concerned with getting products and services where they are needed whenever they are desired. Most consumers take a high level of logistical competency for granted. When they go to store, they expect products to be available and fresh. It is rather difficult to visualize any marketing or manufacturing without logistical support Modern logistics is also a paradox. Logistics has been performed since the beginning of civilization: it’s hardly new.However implementing best practice of logistics has become one of the most exciting and challenging operational areas of business and public sector management According to Council of logistics management: â€Å"Logist ics is the process of planning, implementing and controlling the efficient, effective flow and storage of goods, services and related information from point of origin to point of consumption for the purpose of conforming the customer requirement†. Logistical management includes the design and administration of systems to controls the flow of material, work- in – process, and finished inventory to support business unit strategy.Logistics is the designing and managing of a system in order to control the flow of material throughout a corporation. This is a very important part of an international company because of geographical barriers. Logistics of an international company includes movement of raw materials, coordinating flows into and out of different countries, choices of transportation, and cost of the transportation, packaging the product for shipment, storing the product, and managing the entire process. Analysis of the figure of evolution of logistics [pic] Fragment ation 1960This era was known as fragmentation because every thing that done was disintegrated Evolving Integration At this stage of time new concepts of Logistical management were evolving Total integration In the present scenario because of technological advances logistics has evolved as part of management Concept of Logistics The concept of logistics is fairly new in the business world. The theoretical development was not used until 1966. Since then, many business practices have evolved and logistics currently costs between 10 and 25 percent of the total cost of an international purchase.There are two main phases that are important in the movement of materials: material management and physical distribution; Materials management is the timely movement of raw materials, parts, and supplies. The physical distribution is the movement of the firm's finished products to the customers. Both phases involve every stage of the process including storage. The ultimate goal of logistics is: â €Å"To coordinate all efforts of the company to maintain a cost effective flow of goods. † Word, ’Logistics’ is derived from French word ‘loger’, which means art of war pertaining to movement and supply of armies.A military concept, fighting a war requires: i. Setting of an objective ii. Meticulous planning to achieve the objective iii. Troops properly deployed iv. Supply line consisting weaponry, food, medical assistance, etc. maintained v. Plan should be such that there is minimum loss to men & material Like fighting a war in the battlefield, the marketing managers also need a suitable logistics plan that is capable of satisfying the company objective of meeting profitably the demand of targeted customers. Inbound logistics + Material Management + Physical Distribution =LogisticsDiscussion of each and every term in this above summation i. Inbound logistics covers the movement of materials received from suppliers ii. Material management describes t he movements of material & components within a firm iii. Physical distribution refers to movement of goods outward from the end of the assembly line to the costumer. iv. Supply- chain management is somewhat larger than logistics and it links logistics more directly within the user’s total communication network & with the firm engineering staff. It includes manufacturer and suppliers but also transporters, warehouses, retailers and customers themselves.Importance of logistics i. Transportation cost rose rapidly due to the rise in fuel prices ii. Production efficiency was reaching a peak iii. Fundamental change in inventory philosophy iv. Product line proliferated v. Computer technology vi. Increased use or computers vii. Increased public concern of products Growth of several new, large retail chains or mass merchandise with large demands & very sophisticated logistics services, by pass traditional channel & distribution viii. Reduction in economic regulation ix. Growing power of retailers x. GlobalizationThe interrelation of different logistics element and their costs should be based on total cost rather than individual costs. The objectives of Logistics Operating Objectives In terms of logistical system design and administration, each firm must simultaneously achieve at least six different operational objectives. These operational objectives, which are the primary determinants of logistical performance, include rapid response, minimum variance, minimum inventory, movement consolidation, quality, and life-cycle support. Each objective is briefly discussed. Rapid ResponseRapid response is concerned with a firm's ability to satisfy customer service requirements in a timely manner. Information technology has increased the capability to postpone logistical operations to the latest possible time and then accomplish rapid delivery of required inventory. The result is elimination of excessive inventories traditionally stocked in anticipation of customer require ments. Rapid response capability shifts operational emphasis from an anticipatory posture based on forecasting and inventory stocking to responding to customer requirements on a shipment-to-shipment basis.Because inventory is typically not moved in a time-based system until customer requirements are known and performance is committed, little tolerance exists for operational deficiencies Minimum Variance Variance is any unexpected event that disrupts system performance. Variance may result from any aspect of logistical operations. Delays in expected time of customer order receipt, an unexpected disruption in manufacturing, goods arriving damaged at a customer's location, or delivery to an incorrect location-all result in a time disruption in operations that must be resolved.Potential reduction of variance' relates to both internal and external operations. Operating areas of a logistical system are subject to potential variance. The traditional solution to accommodating variance was t o establish safety stock inventory or use high-cost premium transportation. Such practices, given their expense and associated risk, have been replaced by using information technology to achieve positive logistics Control. To the extent that variances are minimized, logistical productivity improves as a result of economical operations.Thus, a basic objective of overall logistical performance is to minimize variance. Minimum Inventory The objective of minimum variance involves asses commitment and relative turn velocity. Total commitment is the financial value of inventory deployed throughout the logistical system. Turn velocity involves the rate of inventory usage over time. High turn rates, coupled with inventory availability, means that assets devoted to inventory are being effectively utilized. The objective is to reduce inventory deployment to the lowest level consistent with customer service goals to achieve the lowest overall total logistics cost.Concepts like zero inventories have become increasingly as managers seek to reduce inventory deployment. The reality of reengineering a system is that operational defects do not become apparent until inventories are reduced to their lowest possible level. While the goal of eliminating all inventories is attractive, it is important to remember that inventory can and does facilitate some important benefits in a logistical system. Inventories can provide improved return on investment when they result in economies of scale in manufacturing or procurement.The objective is to reduce and manage inventory to the lowest possible level while simultaneously achieving desired operating objectives. To achieve the objective of minimum inventory, the logistical system design must control commitment and turn velocity for the entire firm, not merely for each business location. Movement consolidation One of the most significant logistical costs is transportation. Transportation cost is directly related to the type of product, siz e of shipment, and distance. Many Logistical systems that feature premium service depend on high-speed, small-shipment transportation.Premium transportation is typically high-cost. To reduce transportation cost, it is desirable to achieve movement consolidation. As a general rule, the larger the overall shipment and the longer the distance it is transported, the lower the transportation cost per unit. This requires innovative programs to group small shipments for consolidated movement. Such programs must be facilitated by working arrangements that transcend the overall supply chain. Quality improvement A fifth logistical objective is to seek continuous quality improvement.Total quality management (TQM) has become a major commitment throughout all facets of industry. Overall commitment to TQM is one of the major forces contributing to the logistical renaissance. If a product becomes defective or if service promises are not kept, little, if any, value is added by the logistics. Logist ical costs, once expended, cannot be reversed. In fact, when quality fails, the logistical performance typically needs to be reversed and then repeated. Logistics itself must perform to demanding quality standards.The management challenge of achieving zero defect logistical performance is magnified by the fact that logistical operations typically must be performed across a vast geographical area at all times of the day and night. The quality challenge is magnified by the fact that most logistical work is performed out of a supervisor's vision. Reworking a customer's order as a result of incorrect shipment or in-transit damage is far more costly than performing it right the first time. Logistics is a prime part of developing and maintaining continuous TQM improvement. Life-Cycle supportThe final logistical design objective is life-cycle support. Few items are sold without some guarantee that the product will perform as advertised over a specified period. In some situations. The norma l value-added inventory flow toward customers must be reversed. Product recall is a critical competency resulting from increasingly rigid quality standards, product expiration dating and responsibility for hazardous consequences. Return logistics requirements also result from the increasing number of laws prohibiting disposal and encouraging recycling of beverage containers and packaging materials.The most significant aspect of reverse logistical operations is the need for maximum control when a potential health liability exists (i. e.. a contaminated product). In this sense, a recall program is similar to a strategy of maximum customer service that must be executed regardless of cost. Johnson & Johnson's classical response to the Tylenol crisis is an example of turning adversity into advantage. The operational requirements of reverse logistics range from lowest total cost, such as returning bottles for recycling, to maximum performance solutions for critical recalls.The important p oint is that sound logistical strategy cannot be formulated without careful review of reverse logistical requirements. Some products, such as copying equipment, derive their primary profit from selling supplies and providing aftermarket. Service. The importance of service support logistics varies directly with the product and buyer. For firms marketing consumer durables or industrial equipment, the commitment to life-cycle support constitutes a versatile and demanding operational requirement as well as one of the largest costs of logistical operations.The life-cycle support capabilities of a logistical system must be carefully designed. As noted earlier, reverse logistical competency, as a result of worldwide attention to environmental concerns, requires the capacity to recycle ingredients and packaging materials. Life-cycle support, in modern terms, means cradle-to-cradle logistical support. We will now cover the components of Logistics The components mainly comprises of the part m ostly of which we have already covered in our earlier semesters With the help of the figure given below can you tell me with how many terms are you aware with?Yes that very nice of all of you that you are aware of most of the terms But don’t panick!!! I would be covering each term in detail so that you can revise with me For the components see the figure given below Inputs into logistics i. Natural resources ii. Human Resources iii. Financial Resources iv. Information Resources Can anyone tell me what these resources regarding logistics management? Management actions i. Planning ii. Implantation iii. Control We have already discussed these terms in first and second semesters Logistics Management i. Raw Material ii. In-Process Inventory iii. Finished GoodsThese are the systems through which products goes from suppliers to customers. Logistics activities i. Customers Service ii. Demand forecasting iii. Distribution communication iv. Inventory Control v. Material Handling vi. Or der Processing vii. Part & Service Support viii. Plant and Warehouse side selection ix. Procurement x. Packaging xi. Return goods handling xii. Salvage & scrap disposal xiii. Traffic & transportation xiv. Warehousing & Storage Outputs of Logistics i. Marketing Orientation ii. Time & Place Utility iii. Efficient Movement to Customer iv. Proprietary asset Components of logistics management: pic] Questions for self-analysation A. What do you understand by term LOGISTICS? Explain it with the evolution concept. B. With the help of suitable figure discuss the components of logistical systems. C. Define the term LOGISTICS, with suitable example . And the importance of logistics in today’s business life. D. With the help of suitable example clearly explain the objectives of Logistics. Why tylenol remains number one Johnson & Johnson's McNeil Consumer Products Division was hit with a major crisis in September 1982. Their top-seHing product line, Tylenol, was linked to seven deaths in the Chicago area.At the time of the incident, Tyleool enjoyed 35 percent of the $1 billion analgesic market, but by the end of September, this market share had dropped 80 percent. Currently, Tylenol is again the top-selling brand with approximately 30 percent of the now $2,7 billion analgesic market. t How Was Johnson & Johnson (1) able to regain market share and a leading image after such a damaging tragedy? Its recovery was successful because of reverse logistics capability coupled with a marketing strategy that focused on protecting the consumer and going above and beyond what was necessary to instill] trust and an image of security.This recovery plan is a positive prototype for other corporations to follow, which, in effect, may increase the potential for voluntary product recants across a variety of industries. When the List news reports hit about cyanide-tainted Extra-Strength Tylenol capsules, J was unsure whether the tampering occurred in its manufacturing operations or at t he retail level. As such, its first efforts were directed at pinning down the problem. As soon as the lot numbers were identified from the first few deaths, J stopped production in the plant responsible.At the same time, it halted all Tylenol commercials nationwide and began recalls that eventually involved 31 million bottles of product, which had a retail value of $100 million. Another strategy that J took was to work openly and closely with the media. 1 has traditionally maintained a distance from the press, but in this case it felt that openness and honesty would help reduce consumer panic and provide a vehicle for disseminating critical information. A crisis team was put together that included J as well as McNeil executives and top managers.This team was quite sure that the tampering had occurred at the retail level since the incident was isolated to Chicago's West Side and other samples from the same lot were normal. Regardless, they began the recall with the remaining 93,000 b ottles from this lot. The expenses of this first phase of the recall included $1 million just for phone calls and telegrams to doctors, hospitals, and distributors. The sixth poisoning ensured that the tampering was at the retail level since the bottle came from a lot manufactured at its second plant. Since the cause was now isolated, J&1 could concentrate on containment.The first step was to advocate a total recall. While this step was in some ways unnecessary, J&J felt it was a key step to ensure consumer confidence. At first, the FBI and FDA advised against a total recall because of the potential psychological response of the person who tampered with the product and the response of consumers in general. However, after copycat strychnine poisoning in California, all parties agreed that complete removal was the best solution. This total recall entailed the following i. Advertisements stating that NcNeil would exchange tablets for capsules, ii.Thousands of letters to the trade to ex plain the incident and recall procedures, iii. Media statements, iv. A sales force of over 2,000 employees to contact doctors and pharmacists to regain trust and restore their recommendations that had traditionally served as the main promotional avenue for Tylenol products, v. An extensive reverse logistics system that included buying products back from retailers and consumers and shipping returns to disposal centers, and vi. Creating a tamperproof package. It is estimated that recall costs were at least $100 million, most of which involved the reverse logistics operations.By January 1983, the new tamperproof bottles of Tylenol were on the retail shelf. Consumer confidence was obviously regained as a result of the extensive voluntary recall] program, effective public relations, and sales programs and repack operations. This confidence was shown by the fact that at the end of the year, Tylenol had regained almost 30 percent of the market although market share has remained at about 30 percent, sales dollars have more than doubled. Since the total industry sales were about $1 billion in the early 1980s but are now $2. 7 billion CHAPTER-2 Logistics Subsystem Marketing LogisticsIn 1991 the Council of Logistics Management (CLM) a prestigious, professional organization, defined logistics as â€Å"the process of planning, implementing & controlling the efficient, effective flow the point of origin to the point of consumption for the purpose of conforming to customer requirements†. â€Å"Logistics means the art of managing the flow of raw materials and finished goods from the source to the user† To get goods from where they arise to the right place in the right form, at the right time, at the right cost, â€Å"Logistics or physical distribution or distribution logistics is an integral part of Marketing Process†.Essence of logistics in marketing i. Marketing Process is successfully completed when ii. Products are produced and priced to satisfy the i dentified needs of the segment of buyers Arrangements are made to supply these goods through selected distribution channels iii. An awareness is created among the buyers about the availability of the goods through information facilitation & iv. Goods are physically supplied to the buyers at the place & time selected by them. v. Besides satisfying the customers need, the marketing process must be profitable to the seller.So in the Marketing sense, utility is not merely the usefulness of a product to satisfy the customer needs but also moving the product from a manufacturing facility to the user. â€Å"Thus, Logistics is a link between the manufacturing & selling process that leads to the creation of place and time utility† While the production element in the marketing – mix (product, price, place & promotion) leads to creation of ‘form’ utility by taking decisions as product line variety, design, color brand, service, etc. he distribution element comprising distribution channel fixation & physical movement, creates ‘time’ & ‘place’ utility by ensuring that the produced goods reach the place & time chosen by the buyer. Logistics is the designing and managing of a system in order to control the flow of material throughout a corporation. This is a very important part of an international company because of geographical barriers. Relevance of Logistics in Export Management International trade is becoming a more important part of the GNP in the industrially advanced countries.Many firms in these countries have production centers world wide for markets all over the world. Lack of local resources, small size of home market and many other reasons has resulted in functional centers being maintained in various countries. Issues associated with international transportation of finished goods are essentially the same as those that apply to transportation in domestic trade. But, under international operations, goods can be out of exporter's control for longer period of time, more documentation is required, packaging may be more costly and shipping insurance is more costly.The transportation alternatives include ocean shipping and containerization as well as airfreight. The basic activities involved in the flow of goods, like transportation, warehousing and holding of inventories, should be integrated in a systems approach. The systems approach would recognize the trade-offs, such that sometimes more expensive airfreight may be opted for, instead of less expensive ocean shipping, because of savings in warehouse and inventory costs. In the field of exports, it should be noted that transport systems in developing countries are generally not as efficient as in the industrially advanced countries.Transportation is often considered to be the most important single determinant of plant location. Firms in international trade also try to reduce amount of unnecessary product packaging, since packing material can account for almost 40 per cent of the weight of the products shipped. A company can reduce inland transportation charges by locating its distribution facilities adjacent to container ports or airports. The burden of documentation can be eased through computerization. Export management involves marketing in overseas market.Hence the discussions on the interface of logistics with marketing holds good for the relevance of logistics in export management. Yet, in addition, export management has certain unique features, as discussed above, to be understood in the context of relevance of logistics to export management. Importance of Logistics as a strategic resource Logistical Management includes the design and administration of systems to control the flow of material, work-in-progress and finished inventory to support business unit strategy.Discussion of the concept of logistics, its place in the value-chain process leading to profitability, its contribution as one of the primary functio ns and its interface with other functions of the firm bring outs its importance as a strategic resource. However, to be of a real strategic influence, a good amount of competency has to be achieved and a well-defined logistical mission and objectives has to be committed to, by every one in the firm, especially the top management. Logistical competency Logistics involves detailed and complex work.Logistical management starts with how logistical competency fits into a firm's overall strategic. Positioning. It is fundamentally important to view logistics as to how it can be exploited as a core competency. For logistical competency to develop, it is important to develop an integrated framework that defines and relates key concepts. This integration should be in such a way that competitively superior logistical performance contributes to overall enterprise strategy. Logistical competency is a relative assessment of a firm's capability to provide competitively superior customer service at the lowest possible total cost.This typically means that logistical performance is dedicated to supporting any or all marketing and manufacturing requirements in a manner that exploits delivery capability. In short, the strategy is to provide superior service at a total cost below industry average. Alternative logistical capabilities, emphasizing flexibility, time-based performance, operational control, postponement capabilities, and most of all a commitment to perfect service performance typically characterize the service platform of superior logistic achievers.So we can say that all enterprises must perform logistics to achieve their basic business goals. One of several competencies required to create customer value is logistics. When logistics becomes a cornerstone of basic business strategy, it must be managed as a core competency. The Logistical Mission Logistics exists to satisfy customer requirements by facilitating relevant manufacturing and marketing operations. The challe nge is to balance service expectations and cost expenditures in a manner that achieves business objectives.Basic logistical service is measured in terms of Availability Availability means having inventory to consistently meet customer material or product requirements. Operational performance Operational performance deals with the elapsed time from order receipt to delivery. Operational performance involves delivery speed and consistency. A firm's operational performance can be viewed in terms of how flexible it is in accommodating unusual and unexpected customer requests. Service reliability Service reliability involves the quality attributes of logistics.For logistics performance to continuously meet customer expectations, it is essential that management be committed to continuous improvement. Do you know in 1956, in an effort to explain conditions under which high-cost air transport could be justified, Lewis, Colleton and Steele conceptualized the total cost of logistics. Total co st was positioned to include all expenditures necessary to perform logistical requirements. The authors illustrated an electronic parts distribution strategy Wherein the high variable cost of direct factory to customer air transport was more than offset by reductions in inventory and field warehouse costs.They concluded that the least total cost logistical way to provide desired customer service was to centralize inventory in one warehouse and make deliveries using air transportation. The concept of total cost, although basic, had not previously been applied to logistical analysis. Managers typically focused on minimizing functional cost, such as transportation, with the expectation that such effort would achieve the lowest combined cost. The total-cost concept opened the door to examining how functional costs interrelate. The appropriate level of logistics cost expenditure must be related to desired service performance.The simultaneous attainment of high availability, operational p erformance, and reliability is expensive. A significant managerial challenge stems from the fact that logistical cost and increased performance have a no proportional relationship. The typical logistical system in an enterprise seeks to develop and implement an overall logistical competency that satisfies key customer expectations at a realistic total-cost expenditure. Overall, logistical management is concerned with operations and coordination. Operations deal with strategic movement and storage. To complete the total operations mission.Attention must be directed to integrating physical distribution, manufacturing support, and procurement into a single logistical process. These three areas, functioning as an integrated and coordinated process, can best provide operational management of materials; semi finished components, and finished products moving between locations, supply sources, and customers of an enterprise. The mission of the logistical system is measured in terms of total cost and performance. Performance measurement is concerned with the availability of inventory, operational capability, and quality of effort.Logistical costs are directly related to desired level of performance. As a general rule, the greater the desired performance, the higher the total logistics cost. The key to effective logistical performance is to develop a balanced effort of service performance and total-cost expenditure. The strategic integration of logistics is fundamental to an enterprise's success. While a firm may not select to differentiate competitively on the basis of logistical competency, it must perform logistical responsibilities as part of the fundamental process of creating customer value.The relative importance that a firm places on logistical competency will determine the degree of emphasis on achieving internal and external integration. Flexibility is key to logistical competency. Logistical flexibility results from integration and from implementing time-base d control techniques. There are four logistics concepts: i. The systems concept ii. The total cost concept iii. The after-tax concept iv. The trade-off concept The systems concept is based on all functions of a organization working together in order to maximize benefits.This concept sometimes requires certain components of the organization to operate sub optimally in order to achieve maximum goals of the system. The total cost concept is based on the systems concept; however goal achievement is measured in terms of cost. A variation of the total cost concept is the after-tax concept. This goal of this concept is after-tax profit. This concept is becoming very popular because of the many different national tax policies. The trade-off concept links the system together in a way that is very efficient, but can have trade-offs that might be inefficient.The advantages of such high efficiency must be weighed against the risk involved. Logistics is a system having number of components, whic h can be combined in different proportions to achieve a set objective. Long-term objective is profitability; short-term objective is to survive competition by recovering marginal costs. Logistics sub-systems i. Physical Supply or Management of flow of raw materials, spare parts, consumable stores and machinery & tools from suppliers ii. Physical distribution or management of finished goods from the factory to the buyers & iii.Logistical Controls for managing the logistics system, it helps an efficient co-ordination of physical supply & distribution sub-systems. Objective of an ideal logistic system is to ensure flow of supply to the buyer i. In Correct Quantity ii. At Desired location iii. At Required time iv. At useable condition v. At the lowest total cost Thus the objectives encompass efforts to coordinate physical distribution and material management in order to save money or improve service. Elements of logistics system i. Transportation ii. Warehousing iii. Inventory Managemen t iv.Packing & Utilization & v. Information & Communication When economists originally discussed supply-and-demand relationships, facility location and transportation cost differentials were assumed either nonexistent or equal among competitors. Given a facility network and information capability, transportation is the operational area of logistics that geographically positions inventory. Because of its fundamental importance and visible cost, transportation has received considerable managerial attention over the years. Almost all enterprises, big and small, have managers responsible for transportation.Finding and managing the desired transportation mix is a primary responsibility of logistics. Network of three of the functional areas of logistics – information, transportation, and inventory can be engineered into a variety of different operational arrangements. Each arrangement will have the potential to achieve a level of customer service at an associated total cost; In ess ence, these three functions combine to create a system solution for integrated logistics. The final functions of logistics – warehousing, material handling, and packaging – also represent an integral part of an operating solution.However, these functions do not have the independent status of the three previously discussed. Warehousing, material handling and packaging are an integral part of other logistics areas. For example, merchandise typically needs to be warehoused at selected times during the logistics process. Transportation vehicles require material handling for efficient loading and unloading. Finally, the individual products are most efficiently handled when packaged together into shipping cartons or other types of containers. Logistics is viewed as the competency that links an enterprise with its customers and suppliers.Information from and about customer’s flows through the enterprise in the form of sales activity, forecasts, and orders. The whole pr ocess is viewed in terms of two interrelated efforts, inventory flow and information flow. Information flow is a key element of logistics operations. Paper-based information flow increases both operating cost and decreases customer satisfaction. Electronic information movement and management provide the opportunity to reduce logistics expense through increased coordination and to enhance service by offering better information to customers.Information flow was often overlooked because it was not viewed as being important to customers. The Council of Logistics Management recognized this change in 1988 when it incorporated â€Å"material, in-process, finished goods and information† into its definition of logistics Transportation is a key activity in the logistics value chain as it moves product through the various stages of production and ultimately to the consumer. The primary functions include product movement, product storage and integration of international production and di stribution operations.The major transportation principles involve economies of scale and economies of distance. While effective distribution systems should not be designed to hold inventory for an excessive length of time, there are occasions when inventory storage is justified. While the traditional warehousing role has been to maintain a supply of goods to protect against uncertainty, contemporary warehousing offers many other value-added services. These services can be described in terms of economic and service benefits. Economic benefits include consolidation, break bulk and cross-dock, processing/postponement, and stockpiling.Service benefits include spot stocking, assortment, mixing, product support, and market presence The handling of products is a key to warehouse productivity. Handling activities include receiving, in storage handling, and shipping. Packaging has a significant impact on the cost and productivity of the logistical system. An integrated logistics approach to packaging operations can yield dramatic savings. A marketing mix is a compilation of activities designed to attract customers while simultaneously achieving business objectives.The so-called four P's -products/service, promotion, price, and place – constitute a generic marketing mix. The key to formulating an effective mix strategy is to integrate resources committed to these activities into an effort that maximizes customer impact. Logistics ensures that customer requirements involved in timing and location of inventory and other related services are satisfactorily performed. Thus, the output of logistical performance is customer service. Logistical competence is a tangible way to attract customers who place a premium on time and place-related performance.Thus the discussion on the objectives, logistics interface with marketing and the system elements brings out the depth of the scope of logistics in the efficient functioning of any business entity. The key to excellent logi stics is to achieve integration of both internal and external operations. Such integration requires clear identification concerning the role that logistical competency is expected to play in overall enterprise strategy. Key Factors Involved in efficient and effective and effective logistics system are i. Shippers (users of logistics) i. Suppliers (of logistics services) iii. Carrier (rail, road, sea, water, pipeline) iv. Warehouse Providers v. Freight forwarders vi. Terminal operators (port, stevedores, etc vii. Government (regulator of logistics) Trade-Off Analysis Trade-off analysis is a family of methods by which respondents' utilities for various product features (usually including price) are measured. In some cases, the utilities are measured indirectly. In this case, respondents are asked to consider alternatives and state a likelihood of purchase or preference for each alternative.As the respondent continues to make choices, a pattern begins to emerge which, through complex m ultiple regression (and other) techniques, can be broken down and analyzed as to the individual features that contribute most to the purchase likelihood or preference. The importance or influence contributed by the component parts. i. e. , product features, are measured in relative units called â€Å"utils† or â€Å"utility weights. † In other cases, respondents are asked to tell the interviewer directly how important various product features are to them. For example, they might be asked to rate on a cale of 1 to 100 various product features, where 1 means not at all important to their purchase decision and 100 means extremely important to their purchase decision. Trade-off analyses produce several types of information. First, they tell us what features (and levels of features) are most valued by customers. Second, they allow us to model how likely people will be to purchase various configurations of products, the share of revenue these products will most likely receiv e and what role price plays in the assessment of acceptability. There are four main types of trade-off i.Conjoint ii. Discrete Choice iii. Self-explicated iv. Hybrid One additional model, the MACROModel ©2, will be discussed which does not fall into any of the above four categories. We will discuss each of these trade-off types after reviewing a few basic concepts. Experimental Design, A critical issue in most trade-off methods is the selection of product attributes to be combined together to create each product configuration to be tested. If every possible combination of attributes were included in the study, the study would be said to be using a complete or full factorial design.This is desirable but very seldom practical. For example, if we had 6 attributes with 3 levels each, the total number of possible combinations would be 36 or 729. This is much too large to ask one respondent to rate (and 6 attributes with 3 levels each is untypical modest). When a fractional factorial de sign is used, only a fraction of the total possible number of product combinations needs to be tested, For the above example, a fractional factorial design could be generated (usually with the help of a computer) that would require perhaps as few as 14 product configurations to be rated.It must be kept in mind, however, that whenever a fractional factorial design is used, some information will be lost. It is the job of the researcher creating the experimental design to ensure that the information being sacrificed (usually higher order interaction effects) does not compromise the project's ability to answer the research objectives. Bridging Occasionally, even with the most efficient fractional factorial design, we still end up with more products than can be practically accommodated.One possible solution to that problem is bridging3. Bridging allows the attributes to be divided into two or more sets (with some attributes common to all sets). Each set of attributes is treated like its own trade-off study. A fractional factorial design is created for each set of attributes. Respondents are asked to rate or rank two smaller sets of products rather than one large set. The utilities are calculated for each trade-off exercise independently and bridged together to create one final set of utilities.Cognitive and Non-cognitive Behavior Critical to the selection of an appropriate trade-off technique is the issue of which type of behavior, cognitive or non-cognitive, best represents the behavior being measured. Cognitive behavior is behavior that is based on rational, conscious decision-making. Such factors as price, functionality or durability are typically cognitive. Non-cognitive behavior is behavior that is based on less tangible or even less conscious factors such as status, aspiration, insecurity, perceived taste, etc.One might argue that the selection of a life insurance policy, a computer or a water heater are all cognitive decisions and that the selection of a bee r, a skin cream or a pair of pants are all non-cognitive. One might also argue that all decisions made by humans are non-cognitive. However, trade-off techniques that employ direct questions (self-explicated and hybrid) all assume that the behavior being modeled is cognitive, because at least some of the product features are being rated in a way that requires both awareness and honesty from the respondent.That is, the respondent must be aware of the degree to which a product feature affects his or her purchase decision and also be willing to admit to that degree of affect. Additionally, any data collection methods that rely on verbal or written descriptions of product features all assume that the behavior being modeled is cognitive, because the process of understanding a verbal or written description is itself a cognitive behavior. Non-cognitive trade-off models should be based on an indirect trade-off technique (conjoint or discrete choice) and data collection that relies on experi ence rather than language to communicate the product choices.For example, if you are modeling the pant selection process, show respondents a variety of pants that they can see and touch. A consumer may respond to the phrase â€Å"light blue pants† very differently than he or she would to a particular pair of light blue pants. The Four Main Types of Trade-Off Conjoint Conjoint analysis is the original trade-off approach and uses linear models. There is metric conjoint, where respondents monadic ally rate various product configurations, and non-metric conjoint, where respondents rank a set of product configurations.There are also full-profile conjoint, partial-profile conjoint and pair wise conjoint. Full-profile conjoint uses all product features in every product configuration. Partial profile conjoint uses a smaller subset of available product features in the product configurations. Pair wise conjoint requires the respondent to rate their preference for one product over anoth er in a paired comparison. We will only discuss conjoint methods in general in this paper. Conjoint models are simply regression models which are constructed for each individual respondent.Typically, each respondent rates or ranks 20 to 30 product configurations. Each product configuration contains different levels of the product attributes being tested. If the product levels are varied appropriately (the role of experimental design), a regression model can be estimated for each individual, using the product ratings as cases. The coefficients from the model are the utilities or utils. A conjoint approach should be used if a limited number of attributes needs to be tested and utilities need to be estimated for individual respondents, e. g. conjoint-based segmentation. Discrete Choice Discrete choice differs from conjoint in that respondents are shown a set of products from which they pick the one they most want to buy or none if they are not interested in any of the choices shown (ra ther than rate or rank choices). Respondents are shown several sets of choices sequentially. For each choice set, they are asked to pick one or none. This is in contrast to most forms of conjoint where respondents are not allowed to choose none of the product options (MACRO incorporates no-buy choices into its conjoint models).The discrete choice procedure has the advantage of being more like the actual purchase decision process than does any of the data collection methods used in most Conjoint studies. . Also, in conjoint methods, the mathematical models constructed to simulate market behavior are based on linear regression models. In discrete choice, the basis is the multinomial logit model4, which is non-linear. Another analytical difference is that, in conjoint procedures, the utility weights are estimated for each respondent individually. These weights can often provide the basis for a very powerful customer segmentation.Most commercially available forms of discrete choice do n ot allow this option, although this may be rapidly changing. Further, because discrete choice models are generally estimated at the aggregate level, there exists the possibility that respondents will have strong but opposite preferences to one another. These preferences will effectively cancel each other out when the model is constructed at the aggregate level, yielding the incorrect conclusion that respondents had no strong preference. This is sometimes referred to as the heterogeneity problem.There are two basic forms of discrete choice: classic and exploding data5. Classic discrete choice involves showing a respondent a series of sets of products (as described above). In exploding data discrete choice, respondents are asked to rank order a set of products based on purchase interest (similar to non-metric conjoint). This rank-ordered data set can be transformed into a format suitable for logic model estimation. Exploding data discrete choice has the advantage of more efficient dat a collection over classic discrete choice. The exploding data approach creates many times ore data points (or cases) than the classic approach with the same interview length. Discrete choice should be used if the primary objective of the study is to estimate market share or price sensitivity, a limited number of attributes need to be tested and the sample population is known to be homogeneous with respect to all product attributes. Self-Explicated Conjoint and discrete choice both determines respondent’s utilities indirectly. Self-explicated determines respondents' utilities directly. With self-explicated scales, respondents are asked directly how important all levels of all attributes are to their purchase interest.Despite its conceptual simplicity, self-explicated models have been shown to be comparable to conjoint models. Self-explicated conjoint analysis requires respondents to reveal their utilities directly. Accordingly, standard questionnaire methods can be used to col lect the information. The technique involves the following steps: i. Respondent are informed about all the attributes and their levels, and the respondents are then asked to identify attribute levels that are totally unacceptable to them ii.From among the acceptable levels of the attributes, respondents are asked to indicate which are the most preferred and least preferred levels of each attribute iii. Using the respondents' most important attribute as an anchor, elicit importance ratings for the other attributes (on a 0 – 100 scale) iv. For each attribute, rate the desirability of the different acceptable levels with the attribute v. Utilities for acceptable attribute levels are obtained by multiplying the importance rating and the desirability ratings.The utilities are then entered into a choice simulator program, and choice information similar to other conjoint programs can be obtained. Self-explicated approaches are useful when there are a large number of attributes and t he decision process being modeled is cognitive. Hybrid Hybrid models are models that use a combination of the above techniques. The most famous hybrid model is ACA, Adaptive Conjoint Analysis. Adaptive Conjoint Analysis, in this procedure, a computer program prompts the interviewer with questions. The procedure is as follows:Respondents are first walked through a battery of feature-importance ratings and rankings; second, through a series of pair wise trade-offs of different product configurations. The product configurations shown to any one respondent may not include all of the attributes being tested. The configurations to be paired are based on the answers to the importance questions and rankings asked in the beginning of the interview. Items that are considered of little importance show up in the comparisons less often. Items that are considered of greater importance show up in the comparisons more often.For each pair of products being tested, the respondent is to indicate which product they prefer and the degree to which they prefer it. The software continues prompting with pair wise comparisons of product configurations until enough data has been collected to estimate conjoint utilities for each level of each feature. Since the procedure is adaptive, only a fraction of the total number of possible product combinations is tested. ACA is an approach that is appropriate for building preference models of cognitive behavior with large numbers of attributes.It may not be as useful when price sensitivity, non-cognitive purchase decisions or interaction terms are to be modeled. Cake Method and Logit-Cake Method Other hybrid models include the Cake Method ©8 and the Logit-Cake Method ©9. Both of these models have been developed by MACRO Consulting and were designed to overcome weaknesses in other models. Cake Method The Cake Method © is a unique, proprietary approach to conjoint analysis which offers several advantages over other conjoint methods: A large n umber of product features (50 or more) can be included in the model First rder interactions can be estimated at both the disaggregate and aggregate levels There is complete control over the experimental design, in a full-profile format Since product combinations are specified, via traditional experimental design, before the interview takes place, physical exhibits can be easily incorporated into the interview The approach involves a specific data collection procedure as well as a unique analytic protocol. The basic outline of the approach is to: i.Collect self-explicated scales on most of the product attributes tested ii. Conduct a full-profile conjoint exercise with a limited number of product attributes, some of which are common to the self-explication exercise iii. Estimate conjoint utilities for each respondent iv. Bridge self-explicated scales to utility weights The Cake Method should be used when there are a large number of attributes, utilities need to be estimated for indivi duals, interaction terms need to be measured and the purchase decision is at least partially cognitive.Logit-Cake Method The Logit-Cake Method is a unique, proprietary approach to choice-based trade-off analysis which offers several advantages over other conjoint methods: i. A large number of product features (50 or more) can be included in the model ii. The heterogeneity problem long associated with aggregate logit models is avoided iii. The traditional advantages of logit models over conjoint models are maintained iv. First order interactions can be estimated v.There is complete control over the experimental design, in a full-profile format Since product combinations are specified, via traditional experimental design, before the interview takes place, physical exhibits can be easily incorporated into the interview, The approach involves a specific data collection procedure as well as a unique analytic protocol. The basic outline of the approach is to: i. Collect self-explicated sc ales on all product attributes tested ii. Conduct a full-profile choice-based exercise with a subset of product attributes iii. Segment the sample based on self-explicated scales iv.Estimate logit models for each respondent cluster v. Bridge self-explicated scales to logit-based utility weights The Logit-Cake Method © should be used when there are a large number of attributes, market share and price need to be estimated, interaction terms need to be measured and the purchase decision is at least partially cognitive. MACRO Model One other model will be discussed in this paper. It does not fall into any of the four main types of trade-off models. In fact, it is not strictly speaking a trade-off model because it does not estimate utilities for any product attributes.The MACRO Model was developed by MACRO Consulting to address a specific research methods need that frequently occurs in new product development and packaging. The MACRO Model is a unique approach to new product screening which offers several advantages over other methods: i. A large number of concepts or packages (50 or more) can be screened at one time ii. Price sensitivity can be calculated for every new product concept screened iii. Price/volume can be individually optimized for every product concept tested iv.New product concepts can be screened and/or completely rank ordered on consumer appeal, market share, unit volume, gross dollar volume or gross profits. The approach involves a specific data collection procedure as well as a unique analytic protocol. The basic outline of the approach is to Sort a stack of new product concepts cards (all new product concepts, each at three price points) into two piles: would definitely buy and would not buy. Note: Stack would contain several existing products as reference have them rank order the would buy pile on a continuum from most want to buy to least want to buy.If the number of items to be sorted is too large for one sorting exercise, the task can be broken down into several smaller exercises, with two or three items common across sorting tasks. After the data are collected for all respondents for the various sorting exercises, a bridging technique can be used to incorporate the data from the separate exercises into one rank ordering of all of the items used in the study. Once the data are combined into one rank order data set for each respondent, the MACRO Model © (a first choice share of preference model) can be constructed.The MACRO Model © should be used when the product is too complex to decompose into attributes, e. g. , packaging graphics, when a large number of highly different products are to be included, e. g. , new product screening, when price sensitivity needs to be measured and when products will be screened based on their revenue potential. Conclusion There are a variety of approaches to trade-off analysis, each with its advantages and disadvantages. Which trade off procedure is best is dependent on the issues and constraints of each marketing problem.The marketing problem should be discussed with a researcher who is knowledgeable in all appropriate methodologies before a research approach is selected. Thus trade-off are necessary. The aspects of trade-off analysis are i. Within One logistics Elements, Trade-off that occurs within a single element ii. Between logistics Element, Trade-off that are possible by considering the impact of one on the other iii. Interface between companies functions, these trade-off are brought about through impact on production. iv. Between the Company & other organizations, These trade-off benefit all concerned organizations.Forms of logistics management. Centralized logistics management Centralized logistics management provides that managers that also head other divisions of the company head the logistics operations. This type of management helps avoid internal problems by having a central manager that ultimately decides how logistics and operations are coor dinated. Decentralized logistics management Decentralized logistics management is based on the fact that a company needs to have a division that helps control the local-adaptation needs. Dealing with different cultures requires input from the local branch.The managers that deal with the cultural differences on a daily basis normally know what works and what don’t. Outsourcing Outsourcing is the final option for logistics management. When this happens, transportation firms concentrate on logistics, and the company can concentrate on it's production. There are many cost savings using this type of program, however that lack of control can negatively effect many companies. International logistics requires many different options and requirements to be met in order for a company to operate internationally.It's like a big puzzle that must be put together, in order for all the goals to be met. As described above, there are many options to consider, and sometimes what appears to be an option really isn't. It is not difficult to hit a road block, and you must start over with a new plan. Once the logistics plan is in place, you must constantly look for improvements in order to maximize profits and goals. Source for trade off analysis An edited version of this article was published in the February, 1998 issue of Quirk’s Marketing Research Review. i. P.Richard McCullough, MACROModel ©-A Price Sensitivity and Volumetric Approach to New Product Concept Screening, Mountain View, CA, 1995. A MACRO white paper ii. Pierre Francois, Douglas L. MacLachlan and Anja Jacobs, Bridging Designs for Conjoint Analysis: The Issue of Attribute Importance, Leuven, Belgium, 1991-2. An unpublished paper iii. R. Duncan Luce, Individual Choice Behavior: A Theoretical Analysis, New York: John Wiley, 1959 Richard R. Batsell and Abba M. Krieger, Least-Squares Parameter Estimation For Luce-Based Choice Models, June, 1979. iv. Randall G.Chapman and Richard Staelin, Exploiting Rank Ord ered Choice Set Data Within the Stochastic Utility Model, Journal of Marketing Research, August, 1982. v. V. Srinivasan, A Conjunctive-Compensatory Approach To The Self-Explication of Multiattributed Preferences, Decision Sciences, 1988, vol. 19. vi. ACA is a product of Sawtooth Software, Inc. , Sequim, WA. Sawtooth Software offers a broad range of trade-off software products. vii. P. Richard McCullough, The Cake Method ©-A Proprietary Hybrid Conjoint Approach to Trade-off, Mountain View, CA, 1997. A MACRO white paper. viii. P.Richard McCullough, The Logit-Cake Method ©-A Proprietary Hybrid Choice-Based Approach to Trade-off, Mountain View, CA, 1997. A MACRO white paper. Questions for self-analyzation: Q1 What is the relation between Marketing and Logistics? Quote a Suitable example to prove the relationship. Q2 What are the subsystems of Logistics Management? Expain the importance of about each system with respect to the importance in business? Q3 What do you understand by Trad e-Off Analysis. Explain the various techniques used to do the same. Also explain the importance of trade-off analysis. CHAPTER-3International Logistics Introduction For the international firm, customer locations and sourcing opportunities are widely dispersed. The firm can attain a strategically advantageous position only if it is able to successfully manage complex networks, consisting of its vendors, suppliers, other third parties, and its customers. Logistics costs comprise between 10% and 30% of the total landed costs of an international order. Thus, international logistics is a competitive tool. Effective international logistics and supply-chain management can produce higher earnings and greater corporate efficiency.Definition