Meaning of transaction costs of agrarian enterprises’ economic potential

UNC 339.138:664.61

Number, year
4(81), 2014

Malyuk S.

Activity of any business is always connected with the concept of the product that it produces. In the marketing sense – the product is considered not simply as a result of production, but as the product that is provided with the support of the manufacturer, which is achieved using such marketing tools as competent advertising company, established sales, efficient service, flexible pricing policy and more.

In marketing theory there is no clear distinction between «goods» and «product». Thus, some authors understand by the term «product» «concrete result of material or intellectual production that has qualities that characterize his purpose, and properties for which it was purchased and consumed». Other scientists understand the product as a «complex and vast ambient properties (characteristics, features, benefits and uses) designed to meet the needs of consumers». Thus, the Kotler’s model «5 levels of product» consists of five levels: the level of core values; basic characteristics; expected characteristics; appendix characteristics; potential characteristics. This approach allows identifying the perception of the product demands of consumers, competitors offer and excellent product performance.

Commodity supply Company by Kotler can be represented by the commodity nomenclature, product range, some nomenclatural positions seller. Kotler product portfolio is characterized in terms of its breadth, intensity, depth, harmony and comparability. The concept of range is closely related to the notion of structure and product range (nomenclature) positions. Assortment (nomenclature) position by J. R. Evans, is a specific model, mark or size of products. J. Schwalbach, notes that «the success of the proposal depends on the success of marketing in general; with the usual product that is well received, you can always make a good business. On the contrary, in the case of an unsuccessful proposal, any marketing efforts will not save the company from defeat».

Thus, we can conclude that a good product (goods) is the key to financial success and stability, both in the short and long term. The optimal product portfolio is individual for each company, depending on the markets, demand, production, financial and other resources. The process of determining the range and variety of goods that are produced is an integral part of the product policy of the company.

The article studies the impact of transaction costs on the formation of the economic potential of agrarian enterprises. The structure of the economic potential of agrarian enterprises was discussed. It was noted that with the change of agrarian enterprise’s position, its potential is also transformed. Its structure also became more complicated. (more…)

Assortment strategies in complex marketing system of enterprise.

Number, year
3(79), Vol. 1, 2014
УДК 339.138:664.61

In the face of uncertainty and variability of market conditions, as well as very tough competition between producers, an essential element of economic security of enterprise is to plan the optimal product assortment, which requires manufacturers to make the right strategic decisions and choosing effective product line strategy.

At the present stage of development, there are many marketing options of assortment strategies. Depending on the strategic direction of the enterprise shareware assortment policy they can be grouped into three categories: 1) innovation strategy of the goods; 2) variations in product strategy; 3) the strategy of elimination product.

Update product or innovation in product portfolio is going towards differentiation and diversification. Differentiation is based on improving the attractiveness of the product due to its diversity. Conceptually differentiation is the development of different variants of commodity supply at two levels: between competitors for similar goods and between goods of one manufacturer targeted at different market segments. The strategy of diversification of product range is based on the idea of maximum possible expansion of product lines positions.

Variation (modification) of goods often is to change the external shape of the product, its packaging, and technical and performance properties. Subject variation may be physical and functional properties; aesthetic properties; market attributes of goods; additional services.

Strategy of elimination, i.e., removal of old product from the market, is imposed by the market and the demand for it. For removing the goods from the market, the following strategy of elimination is used

1) harvesting;

2) exhaustion;

3) the concentration of effort;

4) enhancing product lines;

5) exclusion of product lines.

During studying the strategies of enterprise product lines, we have found that in practice it is advisable to use a set of several product policy strategies rather than each separately, as they complement each other. Also, we note that while most used in domestic enterprises are diversification strategy that enable companies to obtain sustainable competitive advantage and reduce risks.

Keywords (more…)