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The Quality Furniture Company (Lloyds)

In: Business and Management

Submitted By Jahangirzada
Words 841
Pages 4
Name of the business: The Quality Furniture Company (Lloyds)
Nature of the Business: Manufacturer of home furniture

Marketing Analysis:
Quality furniture manufactured a limited line of high quality furniture to strong market. The demand for company’s products is mostly seasonal. In summer Quality furniture experience downtown in sales and a slight upturn in winter. Sales growth rate were -20.1% and 0.6% for the years 1991 and 1992 respectively. In that period customers switched to high priced and quality furniture and it influenced negatively to sales of company as it had retailers with low-priced furniture lines.
Customers buy their product because the sell high quality furniture. Quality Furniture tried to support their customers in order to keep rational distribution of its products. They have very clear strategic plan, which is to make national advertisement and allocate their products through stores that are located in particular marketing area.
This market has great potential to grow faster. I think they can increase their sales if managers of Quality Furniture will do broad market analysis in order to meet needs of customers and sell actually what is demandable in market.

Operational Analysis:
The Quality Furniture Company manufactures furniture itself and distributes it to department store. Consequently it has merchandise inventory which means inventory probably one of the largest costs of its business.
I would say company’s asset intensity is not moderate in a first quarter. In 1990 TAT was 2.2 that decreased to 1.6 in 1991. It is because company sales performance in 1991 became poorer and reason of inefficient handling of inventory. Inventory days increased from 103 days to 130. The bad performance of inventory days is reason of decrease in sales, which means inventory accumulates. Collection period increases from 47 days to 67 days, because…...

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