The CEO of a computer hardware company notices that its sales are concentrated at the beginning...

The CEO of a computer hardware company notices that its sales are concentrated at the beginning of each quarter and at the end of each quarter, with few sales in the middle. Sales at the beginning of the quarter and at the end of the quarter have much lower prices, about 10% lower than earlier sales. Why?

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Expert Solution

Sales of hardware company are concentrated in the beginning and in the end of the quarter but a few sales in the middle. Prices in the beginning and in the end of the quarter is 10% lower than earlier sales. The reason of this is that hardware company wants to increase its sales so its sales force cut the prices by 10% or more to increase the sales. Moreover the aim of the sales force is to maximise the sales and revenue. By cutting the prices the sales of the hardwares will be increased because people like to purchase products at lower prices because they can save the amount which is offered by the company in the form of discount or less. The sales force has to be very alert in this by doing right marketing to the right people with new techniques. They have to keep their words. They have to compete with their rivals so they have to lower their prices so that consumers prefer their products but they have to maintain the quality of the product.

So hardware company reduces its prices by 10% in the beginning and in the end of the quarter to increase its sales.

Rahul Sunny answered 2 years ago

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