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the strategy of cost reduce and price increase would be counter-productive as when we focus in cost reduction it would have detrimental effect in terms of loss of quality, revisit, customer disatisfaction. and customer disatisfaction would hamper long term on sales operations
. My approach for profitability are as follows
improve efficiency and productivity of the service center by training, mapping the flow,
Promote value added services.
Award incentives for additional repair ( technicans, floor supervisors, and service advisors)
Award incentives for zero repeat repair for the team( lesser chances for revisit, )
Dear Rabee
first your question is not clear for profitability analysis if you mean whatt is the important from the way of production size is reducing the cost becuse price increase is based on elastic of demand if the product have no relation between demand and price increase the compare here it will be based on % of increase let us say the price was100 KD and become110 KD and cost is90 KD which will not reduce and we sold1000 pic so the important will be the sales increase becuse we will sell the same quantity the GYM will increase by1000 KD but if the sales Quantity is400 the GM will reduce by2000 KD.from other way if we reduce the cost by5 KD and so the there is will not be any change on demand the GM will increase by5000 KD.finaly it is demand on product elastic or inelastic.
but normal the price increase it will more important
