How can the right business software from RedCappi greatly enhance the value of your software product?? To appreciate this fully, it would be best to begin with an analysis of your company?s business plan and how it can benefit from a first-rate marketing program.? This analysis would begin with a look at the elements that are critical to the plan itself.? It is important to look at every element of the plan from the standpoint of how well it contributes to the franchise value of the enterprise, as reflected in the ability to attract capital or financing:
- Top Line.? This is the revenue line; the company wants to maximize sales.? At the same time, it wants to control the selling and other costs associated with these sales.? A good marketing program can help with both of these goals, by boosting sales at a reasonable cost.
- Margin.? Depending on the nature of the product or service, there are costs associated with producing it.? Unless these are controlled, the firm risks falling into the proverbial trap of ?losing money on each sale but making it up in volume.?? When investors are involved, they tend to punish a management that cannot maintain and even expand margins.
- Free Cash Flow.? One of the key tests for many investors is so-called EBITDA, a non-GAAP measure that begins with after-tax earnings and then adds back interest, depreciation, and amortization.? However, for a company whose business model inherently involves a lot of capital goods, the utility of excluding these items would be quite limited and could even be misleading.
- Volatility.? Investors prize a company that produces growth in each period, hopefully at an increasing rate, and the penalize deviations from this path, because such deviations call into question the predictability of earnings.? At the same time, excessive focus on short-term numbers can lead a firm to make decisions based on short-term results at the expense of the long-term prospects of the company.
- Networking.? Prof. Chen has coined the term Business Model 2.0 to take account of the importance within a 21st century business model of the ability of technology and the so-called ?networking effect? to boost the franchise value of a company.
In conclusion, a marketing plan should be crafted in a manner that takes into consideration all of the elements of a business plan, in order to ensure that marketing is doing its part, by making use of the opportunities presented by the evolving internet environment, to enhance the value for the benefit of all of the stakeholders, including customers, employees, and investors.
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