Strategic Management and Competitive Advantage Report - Analysis
VerifiedAdded on 2022/09/08

ADVANTAGE
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Assignment B:............................................................................................................................3
1. Introduction............................................................................................................................3
2. Business performance............................................................................................................4
2.1 Observations made inside the target market.....................................................................4
2.1.1 KPMs obtained by the company................................................................................4
2.1.2 Comparison made in actual and forecasted results....................................................6
2.1.3 Trending analysis.......................................................................................................8
2.1.4 Ansoff Matrix..........................................................................................................12
2.1.5 Porter’s Generic Forces...........................................................................................13
2.1.6 Plans for business development...............................................................................15
2.1.7 Strategies for finance...............................................................................................16
2.1.8 Strategies of marketing............................................................................................18
2.1.9 Strategies of operations............................................................................................19
2.1.10 HRM......................................................................................................................19
3. Conclusion............................................................................................................................21
Reference List..........................................................................................................................22
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1. Introduction
The automobile business firm called “Leopard Eco Automobiles” primarily aims to initiate
higher rate of sales for their budget-friendly cars which are also packed with updated and
modernised features. In addition, the company’s customer base has also helped in providing
best price for their incurred services from the company. Leopard automobiles aim to visualise
and obtain advanced rates in the automobile market by effectively focusing on their
environment and financial background. The records collected from the end of each rounds is
going to help in reflecting the company’s value-added services and norms and reflect upon
the primary reason for the increase rate of sales by 100 per cent for the company during four
different rounds.
Rates of
performance
measurement
Values incurred
in round 1 £m
Values
incurred in
Round 2 in £m
Values
incurred in
Round 3 in £m
Values
incurred in
Round 4 in £m
Rate of revenue
balance (Loss)
3000 4427 6248.45 8189.49
Unsold rate of
stocks values
0 0 0 22421 (Leo
Mini products)
Funds obtained
from
shareholders
832.88 1490.25 2245.33 3788.28
Bank rates and
closing balance
569.99 1146.95 1714.88 3276.71
Outstanding
values and loan
balances
271 0 0 0
Table 1: Summarised values of Key performance measures and derivatives
(Source: Self-made)
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cent, increase in the growth and efficiency rate by 50 per cent, and attaining a definite market
share accounting for more than 6 per cent by expanding the business operations to different
parts of the world. They overall key performance measurements and derivatives effectively
indicates that company is effectively looking to gain an advanced rate in the market share by
attaining reflective growth and attaining advanced customer satisfaction levels in the future
financial years.
2. Business performance
2.1 Observations made inside the target market
The derivative and target market initiated by “Leopard Eco automobile” has been reflected
upon the clients and customers who have a limited and strict line of budget who effectively
wants to enjoy a source of premium feature inside their cars. The automobiles that are
manufactured and produced by the company are effectively reflected to be efficient and
inherit a lesser rate of environmental footprint by 0.5 per cent which is considered to be very
efficient and low in comparison to the other cars and companies who are operating inside the
automobile market in the UK. A customer who values the environment and considers being
the changing factors considers the products of Leo automobile to be well versed and efficient
in tackling the negative norms inside the environment. The prices of the products are also
extremely efficient and come with fewer price in comparison to the other sectors operating
inside the similar automobile market in the UK. On the other hand, the company also looks to
increase their rate of market share inside the automobile sector by 1.5 per cent in the current
year and then an additional 3 per cent in the next financial year for the company. In addition,
the company also aims to reflect upon their “economies of scale” by reducing the rates of cost
and their required beneficiary choices that has been paid by the customers during the
accounting period. Due to fewer rate of pricings, and increased rates in initiation strategy and
penetration strategy the company has incurred a major dip in the revenue and profitability
values during the initial stages of the business.
2.1.1 KPMs obtained by the company
The major derivatives of KPMs that the company looks to initiate are as follows:
Increase in efficiency or production rates: The Company looks to achieve this
derivative of increasing their incurred business production by 10 to 15 per cent
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function, the company is going to initiate building upon the raw materials in
diversified and huge numbers after diverging into their rate of sales. This derivation is
also going to help the company in reducing their “incurred cost of material prices”
which is going to increase their overall business operations during the current
financial year (Mulligan, 2019). The employees of the company are also going to be
managed and trained well as they are the major contributing factors of the company.
Due to the necessary investment made in the production and innovation techniques in
the initial phases the company is then expected to incur lesser financial derivatives
and value during the initial financial years.
Growth in sales: The Company expects to keep their sales value stable and looks to
increase their growth in revenue values by 5 per cent in every financial year. The
expected sales growth for the company’s Leo mini products have been reflected or 40
per cent and a total value of 100 per cent in total three financial years. The more rate
of sales and financial growth is designated to incur additional profits for the
company’s investors and stakeholders. The increase in the overall sales value are
going to help in bringing innovation rates and required techniques inside the
international and developing markets.
Growth in markets share: Leopard automobiles aims to increase their rate of market
share by 6 per cent inside the UK’s automobile industry in the three financial years.
The overall rate of sales and valuation is deemed to be high after reflecting upon the
demand of the products and valuations made in the initial financial years.
Net cash position and reaching new markets: The Company in the later stages will
look to initiate their business operations outside UK and during the initial stages the
company has focused on processing their business in domestic circuit. The long-term
stability and financial plans of this company has been expected to incur an additional
rate of growth, increase in the incurred production facilities and expansion in the
foreign and diversified markets. This derivation is effectively going to help the
company to save their additional values based on import duties, insurance, freights,
and overall transportation costs of the products which makes the business firm more
expensive for their clients and customers in the future financial years. In addition,
after progressing with this derivative the company has effectively been efficient to
increase their overall value of net cash and position. The round 1 balance of bank has
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to £3276.71 million.
Feature and product development: The qualified and deliverable product is always
expected from the company and it is going to improve with time. Business plans are
going to be effectively improving only after the company effectively focus on the
business innovation products and rates after conducting a thorough market research.
This is also going to help in making the company’s products more desirable and
qualified for the customers and is going to incur a source of definite competitive edge.
Gross profit margin: The margin of gross profit has incurred very minimal valuation
and the losses have been observed to increase after each round. This is effectively due
to the advanced rate of cost prices and the expenses that are incurred by the company.
On the other hand, it can be reflected that when a company experiences a higher
margin of gross profit margin by reducing their rate of costs or expenses then the
company is effectively regarded as a profitable business firm (CFI, 2022).
Profit after tax: The balances incurred in profit after tax valuation have experienced a
thorough decline and the surge has been valued at 1 per cent after the tax rates. The
profit that has been experienced after tax has been reflected for £332.87 million in
round 1 and after round four the profit has been reflected for £1542.97 million.
2.1.2 Comparison made in actual and forecasted results
Model outlook and name Type of qualified
Promotion
Incurred budget rates
Leo smart product Roadshows, Journal papers,
magazines and online posters
£1.2 million
Leo mini product Newspapers, radio and
Television
£455,000
Table 2: Budget and promotion of products
(Source: Self-made)
As observed from the above table, the relevant methods that have been utilised by the
company are reflected for reaching out to the incurred consumer base. Four P’s of marketing
have effectively been initiated by the company for increasing its overall sales and derivations
for company’s valuable products that are Leo Mini and Leo Smart.
The marketing strategies initiated by the company are reflected to be:
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specified design. The overall products have also been effectively initiated based on
diversified forms and have been effectively shaped based on old and weary products.
The rolled products are going to be manufactured with differentiated a colour which is
going to help in attracting additional customers to the business plan.
Strategy of pricing: The Company’s Leo Mini model is an economical product and
the Smart model is more expensive and costly. Mini model of the company effectively
suits the overall needs of the customers as it is priced low and will meet the
derivations of customers whose income range is moderate and low. The smart model
of the company is going to initiate and comprise additional and latest features which
are designated to be suitable for people who are earning more than the moderate
people in the society.
Channels of distribution: As mentioned above, the distribution channels are going to
be in the UK and are going to be based out on London. In addition, the company will
look to increase their business operations to the international markets after attaining
reflective profits during the initial stages of the business.
Channels of promotion: Newspapers, magazines, TV commercials, social media
handles and test drive displays are reflected to be the company’s major promotional
channels which are effectively going to help the company to attain additional
customers to their existing business plans
The results obtained in round 1, has incurred differentiated values in comparison to the
results obtained in round 4. The company has experienced a rise in loss after the tax balances
in almost every round. This has been due to the increase in business expenses and tax rates
that has been initiated by the company in every year. In addition, the overall estimated values
and production rates has failed to initiate any form of major growth and the production only
increased by 5 per cent after every round. Company’s Leo Mini and Leo Smart products have
sold 60,000 and 70,000 units respectively. After selling the total products the company
experienced £1056.75 million worth of loss in round 1. The reflective and patent issues that
are surrounding are based on increase rate of business cost and expenses incurred by the
company. From round 1 to round 4, the company has also failed to maintain their regulated
balances of profit and has negatively maintained a “depreciated balance of profit”. I feel the
company is required to initiate in discontinuing their mini products as they are not at all
favoured by the customers as observed from the results in the round 4. There has been a
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Therefore, it can be reflected that the Mini products are not at all favoured by the customers
due to the increase in income rates and latest innovations. In my opinion, the company is
required to initiate major business changes and underline the key business and functional
areas for reducing their manufacturing and business costs. This derivation is effectively going
to help the company to be profitable and sustainable in the future financial periods.
2.1.3 Trending analysis
Figure 1: Increase in production for Leo Mini and Smart products
(Source: Self-made)
Production
The rate of production has always been enhanced and as reflected in the above figure 1, the
company has managed to double their rate of production for both Leo mini and smart
products after inheriting consistent labour and workforce. Leo Mini products have been
designated to increase from 60,000 in round 1 to 102322 in round 4. The Leo smart products
on the other hand have also experienced a surge in production rate from 70,100 in round 1 to
107724 in round 4.
Sales
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(Source: Self-made)
The sales have also been increased for the company and have reflected to incur profit
balance. The company’s round 1 sale have been observed for £3100 million and has extended
to £8189.48 million by round 4 ends. In addition, it has helped in reflecting that the sales and
production of the company has incurred profitable balances and has been effective for
targeting the designated and qualified markets inside a financial year.
Gross Profit Margin
Figure 3: Decrease in the margin gross profit rates
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The overall balances as reflected in the above figure, has incurred depreciated derivations
starting from round 1 to round 4 from -£1056.71 to -£3112.33. The increase in loss balances
for the company are due to the increase in production rates and inventory carriages. The Leo
mini items of the company has seen to incur additional stocks during round 4 which means
the company has effectively failed to sell the produced items.
Unsold stocks rate
The unsold stocks have not been observed in round 1 to 3 for the Leo Mini and smart
products. However, there has been a considerable rise in the unsold stocks rate for the
company during the round 4 as the company has failed to sell the designated stocks. The
company has additionally rolled out a new product line called Leo SUV and Leo Star in
round 3 and 4. The multi-channel techniques of marketing have effectively helped the
company to sell their overall stocks and products which has effectively been produced after
the end of each round. During the round 4 stage, the company has also incurred diversified
stocks amounting to 22420 items for Leo mini products. These products went unsold maybe
due to the les preferential choice of the consumers or due to the rise in technological
derivations that are offered by other company’s products in the automobile market in the UK.
Post-profit and tax
Figure 4: Loss after tax for Leo Eco Automobiles
(Source: Self-made)
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of tax for every round. The overall increase in the loss balance for the company has been due
to the rise in issues that the company faced based on the expense rate in every round. The loss
reflected in the round 1 has been amounted for -£332.87 and during the round 4 the losses
were -£1542.97. The rise in loss rates based on the incurred tax balances decrease the overall
count of net profit for a business firm during an accounting period (Bdc.ca, 2020).
Net cash position
Figure 5: Net cash position and balance of the company
(Source: Self-made)
Net cash rates and balances have incurred very few amounts which are reflected to be a major
risk and issue for the company. The overall balances have been accounted for -£569.98
million in round 1 and by the end of round 4 the values exceeds to -£3276.71 million. This
negative valuation of the overall balances in cash rates reflects that company’s cash balances
based on the ledger accounts have incurred definite form of credit balances (AC, 2020). The
negative balance of cash is reflected to be on a higher scale after checking out the initial rates
and valuation during every accounting period.
Market Share
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(Source: Self-created)
Market rate of share has been reflected to be the best possible measures that have been
incurred by the company during every round. The figure indicates that the company has
indicated to incur profitable market share based on smart and mini products in every round.
Market share and valuation for every mini product of the company has experienced a lesser
share in the market during the round 4 amounting for 1.6 alternatively. However, Leo Smart’s
share of market has considerably increased from 1.45 to 1.96 after the end of round 4. Hence,
this helps in indicating that the products of Leo Smart are reflected to be the company’s most
valuable and selling products which is also going to help the company in incurring additional
balances of profit during every financial period.
2.1.4 Ansoff Matrix
Competition rates and strategy
The competition that Leo Eco Automobiles is going to face in the UK is from BorgWarner
system and turbo, Optare and Toyota Manufacturing (Automotive.UK, 2022). However, for
surviving inside this perfect competition the company is required to initiate the process of
diversification based on their incurred business operations. On the other hand, after analysing
the oveall inputs from round 4, it has been indicated that the company has efficiently
diversified by incurring relevant and additional line of products for boosting up its rate of
sales inside the UK’s market. A company is recommended to increase its overall “product
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Hence this derivation is also going to help in adding qualified value-chains for getting a
definite share of growth inside the domestic circuit. In my opinion, for being more
competitive the company can also broaden their overall competency rates and incur advanced
forms of technology into their products which will help them in being updated and roll out
optimised products which are certainly favoured by the customers and clients in the UK.
Furthermore, decentralised and regional activities are also reflected to be the major
development factors that can be initiated by the company for improving and increasing the
incurred rates of response for being more collaborative inside the competitive market in the
UK.
Strategy of development
Leo Eco Automobiles is required to initiate the process of major developments by creating a
qualified internal framework for the company’s managers, employees and suppliers in
accordance with their respective chains of supply (QD, 2014). The company has also been
asked to overall increase the rate and derivations for increased rate of demand and with the
definite help from inspections, by hiring business and data analysts, by leveraging the overall
usage of manufacturing intelligence which is going to effectively help in reducing the rate of
recalls that has been initiated by the company for progressing with the added notions of the
consumer base during every financial period of the company.
2.1.5 Porter’s Generic Forces
The valuation methods of the cost leadership and its strategy have always been a cheaper
determination for the company and has effectively focused on the rate of every income group
that are currently situated inside a given automobile market or competition during an
accounting period. The company has also incurred additional derivatives of operational costs
that this company is required to pay a lower derivative of the operational costs which is going
to help the company in improving their rate of sales and revenue during the future rounds. In
addition, the company is also recommended to derive the costs of labour for achieving the
targeted goals and sales for the company during an accounting period. On the other hand, the
management of the company is also recommended to come up with positive notions and
plans and incur discount prices as a form of definite strategy that this company is required to
incur in their business plans and be unique in terms of the other competitors that are operating
inside the automobile market in the UK (RC, 2020).
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been characterised due to the higher incurrence levels of customer loyalties and additional
features by incurring reflective advanced and powerful associations with other automobile
companies in the UK. Additional features such as inheriting incurring additional line of
service and products to different class and income segment in the UK is also reflected to be
an effective determination that has helped the company in regaining additional customer base
for the company during the financial year. On the other hand, this business firm is also
required to target a young population in the UK who are aged less than 25 to 30 years and for
the people who does not possess an automobile product in their house. Due to the competitive
and lesser pricing of the products the company expects their rate of profits to be increase by
50 per cent in the future financial periods. Furthermore, the appeal of the overall products for
the company is also going to help in building an effective finance for their customer base
which can be very beneficial for purchase of the products with minimum down payment. In
addition, the overall target markets of this business firm will be achieved by undermining the
following points:
Geographic reflections: The automobile products and services of Leo Eco
Automobiles are required to be initiated inside the internal premises of the UK during
the initial business phase. In addition, the company is required to pursue their overall
business operations inside the urban locations due to a higher rate of income level by
the customers who are residing near the urban locations. The overall demands are
going to be additional as the products that are rolled out by the company are going to
be effectively analysed and furnished after making sure of the required establishments
that are currently present inside a global market.
Behavioural derivations: The overall reflective habits of shopping are also going to be
analysed after a perfect and diversified time scale for purchasing their products and
are effectively going to be figured out with the help of company’s valuated products
and services. The business firm is also required to pay additional time and resistance
level for the reflective marketing conditions and reflections.
Demographics rate: Customers who are aged between 25 to 30 years and are lesser
than 30 years are designated to be the company’s prime customers in the UK.
Psychographic derivation: These understanding are later going to be visualised during
this report. In addition, this derivation is also going to help in undermining which are
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additional line of products and derivatives during an accounting period.
2.1.6 Plans for business development
New and qualified markets: Leo Eco Automobiles is effectively recommended to
proceed with regulatory business operations in the internal environment of the UK
during the initial stages. After attaining advanced rate of profits and marginal gross
profit range the company can look to diversify their business operations further to UK
and USA by extending their line of product. In addition, it is also going to help in
increasing their rate of profits in the future financial years.
Penetration strategy: Leo Eco Automobiles can increase their standards for
penetration by analysing and then increasing their rate of market values and range of
offerings to the customers during an accounting period. On the other hand, the
company can also increase their rate of offerings based on promotions and increase
their rate of production for acquiring advanced rate of profits and customer base to its
business plans during the financial year.
Diversification ranges: Leo Eco Automobile’s diversified business plan is reflected to
be a total form of mixed valuation for the new and qualified targets of the business. In
addition, the company is also looking to indulge into diversified business operations
such as incurring additional line of products for each valuation and rounds for
increasing their range of targeted speed and market valuation during an accounting
period. This derivation is subjected to increase the range of overall profits for the
company and incur additional line of profits during an accounting period.
Meeting minutes: The minutes of the meeting range are also designated to be efficient
and the company is not required to initiate any form of additional time for the meeting
procedure. However, during these meetings the company is required to diversify their
norms of business operations and analyses which areas are going to be reflective as
per the cash and sales forecast made for Leo Smart and Mini products. For the overall
functioning of the meeting minutes the company is required to invest more than 120
minutes twice weekly for meetings in order to plan the business requirements.
Additional product lines: The company can increase their overall product lines by
adding two or more additional products to their existing business plans. For example,
it has been noted that during round 1 and 2 the company has effectively invested in
the production range for small and medium cars. However, the company after
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the initial round plan for incurring additional growth in the profits and valuation
range.
2.1.7 Strategies for finance
Figure 7: Repayments made through loan
(Source: Report from round 1)
The above picture reflects that the company’s cash flow and income balances incurred
additional loan balances worth £270 million based on round 1. On the other hand, the
company did not require any additional form of loan balances for any other rounds. This is
because the initial loan that has been initiated by the company has been reflected to be a form
of “Non-Performing loan NPL”. In addition, the company has also effectively failed to meet
the loan repayments and has effectively incurred a source of “long-term liability” for the
company. Based on the required budget notions, the company has also designated to further
increase their initial rate of budget which resulted in additional loss for the company.
Furthermore, the company has laid out inaccurate focus on the rate of expenses which has
also derived additional balances and losses for the company. The overall rate of gross margin
has inculcated minimised values as the rate of gross balance increased to -£3112.33 in round
4 from -£1056.71 in round 1. Hence, this also indicates that the company has been incurring
additional and further financial loss based on the irrelevant models of business.
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(Source: Self calculated)
As reflected in the above figure, the cash that has been incurred by the company reflects to
incur maximised values and the overall net debt of the company still remains to be valued at
£27,00,000. This exceed in balance rate is effectively due to the rate of business expense and
valuation during the round 4.
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Figure 9: Rise in social media handles and users in the UK
Source: (Dixon, 2022)
The business firm is required to effectively capitalise the rate of budgets for complying with
the rate of sales during every rounds, The rise in expenses are accounted for more than 30 per
cent during every financial period which has indicated a gross loss balance for the company.
Hence, the company is effectively required to inculcate their business operations through
online platforms and social media. As reflected in the above figure, it can be analysed that by
preceding the qualified business operations through online mode is going to be a profitable
notion for the company as the users inside the UK’s social media are expected to increase by
68 million by the end of 2026 financial year (Dixon, 2022). Hence, this can be a positive
measure that can be inculcated by the company in order to attain profitable business growth
and revenues.
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Figure 10: Report from production values
(Source: Report from round 4)
Leo eco automobiles are recommended to increase their rate of production based on the SUV
and smart products as per the observations made in round 4. This is due to a lesser range and
valuation for the rates of productivity and market share. In addition, the company is also
recommended to incur and limit their rates of production as there has been an observation
that 22420 of stocks have been incurred for Leo mini products. In addition, the overall
reflection and idea for extending the SUV and smart products is also reflected to be a definite
and positive option for Leo Eco Automobiles which is going to help the company in boosting
their rate of profit revenues in the future financial periods. As per the reflections made in the
section of earnings, the population of the UK has been observed to incur a definite earnings
growth for more than 3.1 per cent (Clark, 2021). Therefore, with the increase in rate of
production the earnings range has been reflected to be an affordable determination for the
target market. After a month, the company is expected to incur a profitable growth by 5 per
cent.
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Figure 11: Cost of wages and expenses
(Source: Report from round 4)
There has been a reflective rise in the notions of wages as it has been increased from £84.18
million in round 1 to £103.95 million in round 4 for the company. The overall costs for
material has also incurred a significant rate of growth by £5025.41 in round 4 from £1553.47
million in round 1.
Figure 12: Costs of training in round 1 and 4
(Source: Round 1 and 4 reports)
Labour and training costs for Leo Eco Automobiles have been increased from “£12 million in
round 1 to £110 million in round 4”. In my opinion, the company is required to limit these
rates of expenses and costs for attaining a higher rate of profits in the future financial periods.
The company is also going to incur additional costs and rates during the next financial years
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the reduction ins strike days by the workers from round for 3 days and to 2 day in round 4 has
been an effective measurement. This reflects that the company has been efficient and
effective in focusing on their qualified rate of jobs and expenses and are also heavily looking
to increase their line of profits and expense in the future financial periods.
3. Conclusion
This report has reflected that Leo Eco Automobiles is incurring major losses across each of
the four rounds due to a higher rate of expense values and net debts incurred. In addition, this
report has concluded that the company is required to limit their expenses and incur additional
product lines to their existing business plans for being profitable in the future financial
periods.
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AC, 2020. https://www.accountingcoach.com/. [Online]
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[Accessed 25 August 2022].
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[Accessed 25 August 2022].
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[Accessed 24 August 2022].
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users-in-the-united-kingdom-uk/#:~:text=As%20of%202022%2C%20there%20are,reach
%2065%20million%20by%202027.
[Accessed 25 August 2022].
Jain., S. & R.K.Garg, 2018. https://citeseerx.ist.psu.edu/. [Online]
Available at: https://citeseerx.ist.psu.edu/viewdoc/download?
doi=10.1.1.630.3823&rep=rep1&type=pdf
[Accessed 25 August 2022].
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Available at: https://www.qualitydigest.com/inside/quality-insider-news/six-tips-help-
automotive-industry-improve-quality-and-reduce-recalls
[Accessed 25 August 2022].
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Available at: https://rockcontent.com/blog/competitive-pricing-strategy-increase-sales/
[Accessed 30 Auugst 2022].
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