First Cars PLC Plan
It is clearly showing that for the p rapports it is going in the correct direction.With the market expected to grow in terms of market volume, mutinously year on year reaching its final point 1 increase above the baa SE year in 2014 and showing the same trend however with a greater increase for the market v alee, expecting to grow by around 300% over the period shown.
This data clearly backs up the e idea of the proposal as it is suggesting that they are entering a market that is showing the at it should be thriving in the forthcoming years and therefore suggesting that they should g o into the new market earlier rather than later because as the car club market increases like the data suggested so will the competition that is in the market, therefore making it ha deer for them to enter the market the later they wait.
Secondly if they do decide to go ahead with the proposal, the data suggests the at the company is likely to become more professional in the way it operates as they move into a prestigious office in London this will come with a more decentralized organizational struck true.What this means for the company is the fact that the decision making process is spread out to include the more junior managers in the hierarchy, making the decisions made close r to the customer and therefore should hopefully mean that the end service is going to be close to what those who are going to consume it want.
It is also a good way of training junior man eager into how the decision making process works and allows them to be making decisions in the company from very early on, therefore increasing the responsibility they have in the such cues, this will also improve the motivation that they have for their job and decrease the decide Soon making time.
Further to this it will have a massive positive effect on the staff turnover of the business as shown in Appendix C from Human Resources, this table shows that labor turnover is restarted to fall to 5% from 30%, this could be due to the new structure Of the e business, allowing everyone a part in the fundamental decision making process that face sees them every day or the fact that with better working conditions such as a large office in Lo Indo and a higher salary they are bound to be happier in their work.
Further to this the 10 w labor turnover will hopefully reduce the training costs that they are pumping into the e new strategy.
As they have a huge budget for training you assume that this will mean that e employees should feel more motivated as they see the effort the company is putting in to et them highly trained in their job, this should mean that the high cost of training will very m such be a one off cost to the business as this alongside the low labor turnover means that the y should be in a position where they aren’t training new recruits regularly, only if the case arise sees that they have to expand or when they decide they are doing well enough in the market to d o so.
Further to the arguments above the AIR of the investment into the car club p rapports is forecasted to be 15. 6%, this figure passes the expectation of the Directors’ who o said they anted it to be at 12%, this means that they are going to achieve the original investment of E Million quicker that what is expected however there could always be the chant CE for error in the forecasted figures. Other arguments for the proposal would be the fact the at the cost of traveling is predicted to increase by 20% over the next 4 years as price of peter 01, car tax and insurance is growing more and more over time.
Also as said in the date an Inc erase in the emphasis of reducing our carbon footprint has led to people questioning thee r decision to own a car, and this will be further contemplated as car clubs become ever more pop alular, therefore paving the way for car clubs to come into the market. Finally the car club Indus story has a proven track record and therefore instead Of it being a risky option for the co many what it in fact is doing is differentiating testifiers a market that they are beginning to I SSE market share in.
Arguments against: My first argument against would be the fact that they are already running a s successful car rental business and as with any business why would you change something if it is still bringing in a decent revenue, their USPS Of being a no thrills business that is always undo recruiting its imitators is always going to appeal to the tourist that is looking for a simple e car hire for their time in the country.
However the case study does then go onto say that they a re losing market share in a competitive market, therefore they need to change something. Ho waver maybe the idea of moving into a market that is not as widely well known could be devastate dating especially as First Cars PL has no previous experience of the car club market, this could lead to a large amount of unwanted start up costs as they haven’t really got someone d riving the project that IS likely to know exactly what is happening.
Further to this the car club market is already occupied by a lone large company owning 60% of the market share m meaning that it is a monopoly as a result of this they are going to have to do something dramatic calla different to have any affect on the market they are moving into as without a strong USPS t here is no way they will fare well against an already well established successful company that dominates the market market share.
Secondly the previous question tells us that the website is likely to take 1 0 we seeks longer than what the critical path analysis says in Appendix B, because they don’t think the t they can design and test the website in under 15 weeks this means that Amy has made a massive mistake and misjudged by 1 0 weeks, this will have a detrimental effect on the whole process and will put it back to last 27 weeks as opposed to the 23 weeks previously sees admitted, this also changes the critical path from BEG to CHI].
As a result of this First Cars P LLC could experience a number of serious cash flow problems as instead of the comma nines website getting up and running and the first orders coming in, will still be in the pro diction process causing a further cost to the business creating no revenue.