Business Characteristics | My Assignment Tutor

MO’ Job Aid: Business Risk AssessmentBusiness CharacteristicsIndustryPage 1Low Risk Moderate Risk Moderately High Risk High RiskSales and profits not affected by the business cycle; no substitutes available or likelySales and profits mildly affected by expansion and recession; limited substitutes available or high switching costsSales and profits moderately affected by expansion and recession; a number of substitutes available or moderate switching costsHighly cyclical or countercyclical; many substitutes easily accessible; no switching costsStrategy for competitive advantageThe firm’s overall The strategy is The firm has no Key competitors ‘strategy if reasonably clear clear competitive have similar successfully and affordable and strategy; strategy and are executed will management is able management is not better able to favorably set it apart to carry it out, but it focused and may be execute, due to from key is not proven that spending in areas superior competitors; the the strategy will not critical to the management firm has the consistently defeat firm’s success; expertise and management expertise and financial capacity to carry out the strategy the competition competitors are more focused financial capacityGeneral characteristics and goalsSizeMaturity DiversificationOne of the largest in terms of sales, assets, profits, and market share Average size Small in terms of sales, assets, profits and market share One of the smallest in terms of sales, assets, profits, and market share Mature firm— Maturing firm— Emerging firm— Emerging firm—growing at some shakeout of growing at rapid, not growing at explosive reasonable rate weaker competition explosive, rate rate Or declining firm—sales and assets declining over a number of years Company sells many Company sells Company has Company sells products; products several product limited number of single product line have multiple uses lines; products have products or lines or multiple product in many different limited flexibility of with limited lines to a single industries; no use but are sold to flexibility of use; one customer product line diverse customers; product or product accounts for 10% or one product or line accounts for more of company product line more than 30% of sales or profits accounts for 20- sales or profits 30% of sales or profitsJob Aids 145

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