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Showing posts with the label Pricing stratagies

Headwinds & Tailwinds in Finance Explained | [Video + Real-Life Examples]

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Real-Life Examples of Headwinds & Tailwinds in Finance 1. Tech Layoffs – A Headwind for Consumer Spending In early 2023, major tech companies like Google, Meta, and Amazon laid off thousands of employees. This created a headwind for the economy — especially consumer spending. 💭 Why? Fewer jobs = less income = lower spending on gadgets, travel, and entertainment. 📊 Impact: Retailers like Target and Best Buy saw lower sales forecasts. Even small businesses suffered due to shrinking customer budgets. 🔹 2. Falling Crude Oil Prices – A Tailwind for Airlines When global crude oil prices dropped in 2020 during the pandemic, it became a tailwind for airlines. 💭 Why? Fuel is one of the largest costs for airlines. Cheaper oil = lower expenses = higher margins. ✈️ Impact: Even though passenger numbers were down, lower costs helped some airlines survive the storm. 🔹 3. High Interest Rates – A Headwind for Home Buyers In 2023–24, central banks raised interest rates globally to fight ...
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How to estimate Business profits?

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        World of Finance by M.Vijaya Sai Every Business entrepreneur would like to estimate his/her business profits from time to time and work hard to achieve those targets. Here we will learn to use a powerful tool that estimates Business profits. How a business's profits change as the sales volumes change as well as break even points. Although the  purpose of every business may be different but the success of the business is measured in terms of Profitability. The business analyst must  accesses:                            "What is the Break even point?"                              "What should be the Sales turnover for the period?"                            "How to cut down on co...
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Transfer Pricing

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        World of Finance by M.Vijaya Sai Introduction: When Investment Centers have been established, these would be considered as autonomous units. They would be free to purchase their raw materials direct from the market or from their own departments. In case of the latter, there are many advantages like (i) it would be cheaper to buy from own departments, (ii) there would be more quality assurance and reliability. Also, it would be beneficial to the selling department because (i) there would no packing and external transportation costs, and (ii) there would be no bad debt. Why Transfer Pricing? Chief Executive of a big company cannot monitor and control operations of each and every sub-unit. So the sub-units are turned into Investment Centers and necessary authority is delegated to their managers.But in a decentralization, there are difficulties in evaluating the performance of the managers. Further, there is a problem of coor...
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