Revitalizing CFC Technologies: Strategies for Competitive Edge

CFC Technologies can reclaim its position in the market by adopting new business strategies. The company must introduce innovations in their operations to stabilize financial conditions. Analysis of cost and sales data indicates a need for improvement due to declining profits and rising operational costs. Understanding customer psychology is crucial for boosting sales and reducing expenses. Implementing competitive strategies will help CFC Technologies outpace its competitors. Additionally, expanding through e-commerce can significantly increase the customer base, catering to tech-savvy consumers who prefer online shopping for convenience and information access.

Report on CFC technologies

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Table of Contents
Introduction...........................................................................................................................................2
Company performance evaluation.........................................................................................................2
Revenue.............................................................................................................................................3
Cost.......................................................................................................................................................4
Profit......................................................................................................................................................4
Activity drivers......................................................................................................................................5
Second part............................................................................................................................................5
Competitive strategy to improve financial condition.........................................................................5
Competitive strategies.......................................................................................................................6
SWOT.................................................................................................................................................6
Conclusion.............................................................................................................................................7
References.............................................................................................................................................8

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Introduction
CFC technology is an international company which was registered with the initial
capital of USD1000k. Company had gathered experience in producing vacuum, consultancy
services, washing and welding technologies with the help of expertise staff. These staff
members are asset of the organisation. In order to maintain its asset organisation provide
several benefits to them, apart from this CFC also focus on providing good quality of
products and services to its customers. This help in establishing good image in eyes of
society.
Over the period everything was going well and high profits were experienced by the
organisation. However, company experienced downfall in its business because of rise in e-
business. Ecommerce was an easy approach for the customers as, they get wide variety of
goods and complete information about technology without even stepping out.
‘‘Higher the risk higher the chances of earning profits’’ every business involve some
risk. Entrepreneur can overcome this element by conducting proper forecasting, identifying
competitors, and sources of raw material and so on.
In this project discussion will be carried on evaluation of company’s performance in
terms of revenue, cost, profit, activity drivers and competitive strategies that will enable the
organisation to improve its financial conditions.
Company performance evaluation
 Revenue
 Cost
 Profit
 Activities drives

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Table 1 Cost and sales in rupees
Revenue
There are two major parts of revenue, cost and profit. Every organisation should earn
sufficient amount of profit in order to survive and expand its business but sometimes due to
uncertainties such as increase of competition companies like CFC have to bear huge loses
(Browne, 2016).
Sales revenue = units sold x sales price
Over the last three years there is fluctuation in sales of goods and services. Initially
it’s increasing but later there is decline in the sales. In 2016 sales of goods and services is
declined by $816 and $8.
There are many reasons behind decline in sale such as, increase in ecommerce
business although, it is beneficial from the customer point of view as, they get wide choice,
better price range and many other benefits but it has adversely affected the business of
CFC(Sandford, 2015).
Reverse trend goes with cost. There are different cost involved in the production of
tablets such as, raw material cost, direct labour cost, consultant salary and direct over heads.

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Increment in the cost can be seen in year 2016. Overall it can said that, there is rise in the sale
which is beneficial for the organisation.
Cost
Cost refers to the amount of money that manufacturer invest in order to produce the
final product (Healy & Palepu, (2012). Mainly there are two different types of cost. One is
fixed cost and other is variable cost. Fixed cost remains the same even with the increase in
production units whereas, variable cost may vary when the production units increase or
decreases. Cost trend of CFC over the past three years is not stabilised as, there is in increase
in cost every year.
Cost of the company had increased because of increase in the production of goods
from 1000 to 1377. Although fixed expenses of the company remained the same but still
there is increase in overall cost because of the increase in variable cost. Variable cost include,
raw material and overhead expenses.
Every organization tries to reduce the overall cost of production, in order to earn
higher profit margin but it is possible only with the help of economics of scale (Zimmerman
& Yahya-Zadeh, (2011) CFC found it difficult to increase its production as, now customers
of their target segment have shifted because of increase in the number of competitors.
As, CFC is a traditionally retail store so, now it’s high time for the organisation to
adopt new selling techniques. Apart from their retail outlets they should try and expand their
business through ecommerce.
Once they expand their business then it will be easy for the company to work on the
basis of economics of scale. This will not only help organisation in earning high profits but
consumers will also be benefited by it. At the end company will able to regain its image in
the market.
Profit
‘‘Higher the risk higher the chances of earning profit’’ (Liebowitz, (2013). Financial
gains experienced by the organisation after paying off all its expenses is called profit. Every
firm wants to earn reasonable amount of profit in order to survive and expand its business

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(Heal & Palepu, (2012). Without earning profit no organisation can survive for the longer
period of time in the market.
Profit is obtain after deducting all the expenses from the selling price. CFC
technology has experienced decrease in profit in year 2015. As, the profit in 2014 was
$64882 but it falls to $467 in year 2015. Company had experienced decline in its profits
because of tremendous increase in cost in year 2015 and reduce in the sales of tablets.
Although there is again increase in the profitability of the organisation in 2016 but
still if, we compare it with the profit earned with the year 2014 its low. This fluctuation is the
results in reduction in customer base of the company.
Activity drivers
Cost incurred by the organisation are effected by many factors. These factors are
commonly called activity drivers (Chea, (2011). These drivers have capacity to change cost
of business operations. Sometime many cost drivers can occur in the single cost. One of the
most common cost driver is labour hours (Auerbach et al, (2013)Whereas, there are many
technical cost drivers such as, contact of customers with the company, how long machine
work, in order to perform the task how many machines are required and so on.
CFC has increased the number of operators from 2014 – 2016 as a result, there is
increase in labour cost but correspondently there is no increment in sales which result in
decline in overall profitability of the organisation (Jordan, (2017). To overcome its situation
many consultants have been appointed and their number has increased from 50 to 74 within
three years. Advice given by the consultant was not good enough as they failed in helping
organisation to get their position back in the market.
Second part
Competitive strategy to improve financial condition
Financial position of CFC Technologies is not good enough so, in order to overcome
this situation it is important for the organisation to adopt some competitive strategies.
Strategies made by the organisation on the basis of long term planning in order to win over

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the rivals are commonly known as competitive strategies (Chevalier-Roignant & Trigeorgis,
(2011).
Every business man tries to maintain appropriate financial condition within the
organisation so, that if any problem occurs it can easily be solved. Apart from this company
have to face many problems if it financial conditions are not sound enough. Some of these
problem are – difficulty in raising funds, availing raw material on credit and so on (Dewey &
Rogers, (2012).
Competitive strategies
Cost leadership – under this strategy companies try to provide its product at low cost
to its target segment. Manufacturing and selling the products on the cheap rates is possible
only after adopting economics of scale (Baroto, Abdullah, & Wan, (2012). This strategy will help
not only in attracting customers but also help organisation to increase its profitability,
correspondently with the increase in sales. Further it will help CFC in improving its financial
condition.
Differentiation – CFC technologies can improve its financial condition by adopting
differentiation strategy. In this strategy initially firm have to invest money in research and
development, but soon organisation is able to recover its cost because customers are willing
to pay high amount if they find that particular companies offer unique services or a product
(Heracleous & Wirtz, (2012).
Although this is bit difficult for small enterprises to adopt this strategies because of
the problem in arranging funds but, it is considered beneficial to larger enterprises. CFC will
be able to improve its financial condition if it adopt this strategy because –
It will help the organisation at retain its customers.
Helps in attracting new segment.
Helps in developing goodwill in the eyes of suppliers, customers and so on.
Customer intimacy – it’s all about identifying target customers, collecting complete
information about customers such as, their likings, disliking’s, opinion and so on (Peppers &
Rogers, (2016) On the basis of the information obtained, organisation should modify its
product as well as services.

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SWOT
It stands for strength, weakness, opportunities and threats. SWOT analysis conducted on CFC
Technology -
 Strength – organisation strength falls in its customer base, financial resources, and
human resources and so on.
 Weakness – company was not able to attain its targets because of lack of information,
inability to understand changing demands of its target group,
 Opportunity – expansion of business with the help of ecommerce, collaboration with
international partners, and diversifying their existing product line are some the
available opportunities available.
 Threats – major threat for CFC are its competitors present in external environment.
These competitors are able to win over CFC because they judged expectations of their
customer group and changes in Market trends.
Each and every department should be given instructions in detail, regarding change in market
trends so, that they can make suitable changes in their respective plans, which further helps
them to win over their competitors. Once the company satisfy its target group after that it’s
easy for them to increase their sales which will overall improve financial condition.
Conclusion
From the above report it can be concluded that, CFC Technologies can attain their
position back by making some changes in their working pattern. Enterprise need to
understand that, they have to introduce new things in their business, if they want stabilised
financial conditions. Apart from this cost and sales table clearly shows that there is a need of
improvement as, there is decline in profits and tremendous increase in cost of the
organisation. Apart from this organisation should understand mentality of their target group
members in order to increase sale and reduce cost. For this CFC should adopt some
competitive strategy, as this will help them to win over competitors.
CFC technologies should try to expand its business through ecommerce. This will
help organisation in increasing its customer base. In the recent era no one have that much of
time too search appropriate technology. Specially the one who don’t have any knowledge
regarding technologies they find themselves more comfortable in online purchasing as, there
they get complete information and wide choice to choose best among all brands.

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References
Auerbach, A. J., Chetty, R., Feldstein, M., & Saez, E. (Eds.). (2013). Handbook of public
economics (Vol. 5). Newnes.
Baroto, M. B., Abdullah, M. M. B., & Wan, H. L. (2012). Hybrid strategy: a new strategy for competitive
advantage. International Journal of Business and Management, 7(20), 120.
Browne, C. H. (2016). The little book of value investing (Vol. 5). John Wiley & Sons.
Chea, A. (2011). Activity-based costing system in the service sector: A strategic approach for
enhancing managerial decision making and competitiveness. International Journal
of Business and Management, 6(11), 3
Chevalier-Roignant, B., & Trigeorgis, L. (2011). Competitive strategy: Options and games.
MIT Press.
Dewey, J., & Rogers, M. L. (2012). The public and its problems: An essay in political inquiry. Penn
State Press.
Healy, P. M., & Palepu, K. G. (2012). Business analysis valuation: Using financial
statements. Cengage Learning.
Healy, P. M., & Palepu, K. G. (2012). Business analysis valuation: Using financial
statements. Cengage Learning.
Heracleous, L., & Wirtz, J. (2012). Strategy and organisation at Singapore Airlines: achieving
sustainable advantage through dual strategy. In Energy, Transport, & the Environment (pp.
479-493). Springer London.
Jordan, J. (2017). Book Review: 40+ New Revenue Sources for Libraries and Non-profits.
Reference & User Services Quarterly, 56(4), 296-296.
Liebowitz, J. (Ed.). (2013). Big data and business analytics. CRC press.
Peppers, D., & Rogers, M. (2016). Managing Customer Experience and Relationships: A
Strategic Framework. John Wiley & Sons.
Sandford, C. T. (2015). Economics of public finance: an economic analysis of government
expenditure and revenue in the United Kingdom. Elsevier.

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Zimmerman, J. L., & Yahya-Zadeh, M. (2011). Accounting for decision making and control.
Issues in Accounting Education, 26(1), 258-259.