Essays on Market Opportunity, Marketing and Finance Aspects - Global Networks Case Study

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The paper "Market Opportunity, Marketing and Finance Aspects - Global Networks" is an outstanding example of a marketing case study.   Global Networks is a software company to be launched by my friends and myself and our goal is to provide our customers with an “ unfair” competitive advantage by helping them get their products to the market quickly and cost-effectively through custom-built software enabling them to differentiate their products from their competition. Global Networks offering includes (i) IT Solutions (ii) Project Consulting and Services (iii) Software Training. Global Networks offer product development and testing services.   Brief business description Our Business is developing software products domestically, going by the report of NASSCOM, the domestic market is worth $103.6 billion.

The split-up is given below In this total market, our focus is on developing software for Communications and Media (17% i. e. 17.6 billion) and Education sector (14% i. e 14.5 billion). This market size is covered exclusively in the marketing aspect of the plan. (U. S. Bureau of Labor Statistics, 2004-05 Career Guide to Industries and 2004-05 Occupational Outlook Handbook) Our customers We target the following sectors for our business: Textile Companies The problem addressed in this sector is resolving order tracking related delays. Clinical Labs The problem addressed is maintaining digital records, automation software. Education The problem addressed here is creating awareness and the products developed in this area include Touch Screen, Student Log entry system. Other Enterprises In this domain, we create alternates for already established software packages like Tally and customize the software pertaining to the needs of the customer. Industry Analysis Michael Porters Five Force Analysis – IT Industry The threat of New entrants: The Entry barriers include Capital The capital outlay needed for starting up the operation in the IT industry is minimal.

In India, it will cost about $7500 to begin a start-up.

The leasing expenses and taxes are considerably low compared to other industries. The capital includes land and building, infrastructure, employees etc. Labor: In this industry, the retention rate is low when compared to the others because of the demand for the experienced programmers in the industry. Finding and retaining skilled labor is a major issue for a new entrant. Labor is highly expensive in this industry and hiring talented persons and retaining them remains a big challenge. A start-up cannot afford to pay huge sums of money to hire and retain talent in this industry.

This obviously will result in selecting freshers and in turn will affect the quality of the software. Most of the startups fail only because of labor in this field. Tax Structure: IT Industry has to bear huge taxes levied on them by the government for the property, water, electricity etc. Recently, the fringe benefits tax levied by the government is having a huge impact and erodes the profit potential of the IT industry slowly. IT industry is relevantly a new industry and the tax structure that is applicable to other industries will not suit this industry.

The recent rapid growth in exports and the huge revenue potential of the industry have to lead to the introduction of new taxes and the corporate tax is being levied higher than ever before.

Reference

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• Kotler, Philip. Marketing Management, Eastern Economy Edition, Prentice-Hall India Ninth Edition, 2004.

• Charles W.L.Hill, Gareth R.Jones, STRATEGIC MANAGEMENT THEORY, Houghton Mufflin publications.

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• Garry Dessler, Human Resource Management, 2004, 10th edition, Eastern Economy edition.

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• M E Porter, “Competitive Advantage”, 1985

• U.S. Bureau of Labor Statistics, 2004-05 Career Guide to Industries and 2004-05 Occupational Outlook Handbook

• Francis Cherunilam, Business Environment, Himalaya Publishing. Pg. 499-508.

• Bachon Nicholas, Storey John, British Journal of Industrial Relations, Vol. 38, No. 3, September 2000

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