Methods to determine Promotional Budget
What are the methods to determine Promotional Budget? Explain in brief.
Expert
Methods to Determine Promotional Budget:
• Affordable Budget: setting the promotional budget at the level the management can afford. Often used by small businesses, the starting point is after allocation of capital outlays and operating expenses from the revenue the remaining is allocated for advertisement. However the method completely ignores the effect of promotion on sales and may lead to over or under promotional spending.
• Percentage of Sales Method: is setting the promotion budget at a certain percentage of current or forecasted sales or as a percentage of sales price. Simple to calculate, it helps the management to link relationships between promotion spending, selling price and profit per unit. However it wrongly views sales as the cause of promotion rather than the result. Yearly budget variations causes problem with this method as the method does not provide basis selecting the percentage use.
• Competitive-Parity Method: is setting the promotional budget as per the competitor’s outlay. This method helps in preventing the promotional wars as each firm tries to have equal share of the market. But this justification has not been helpful for explaining the competitor’s spending.
• Objective and Task Method: involves developing the promotion budget by defining the promotional objectives, determining the tasks that would help in achieving these objectives, estimating the costs of performing these tasks. The sum of the above costs is the proposed promotion budget. However it is a difficult method to use.
Describe some primary advantages while a corporation has operations in countries other than its home country? Explain risks? Foreign operations may decrease a company's labour or material costs, and may raise its sales. Risks comprise possible
Are there any legal factors which could restrict a corporation in its attempt to pay cash dividends to common stockholders? Describe. A firm may be legally limited as to the dividends it can pay through existing bond indentures or loan agreemen
Normal 0 false false
Staff Benefits: It is an object of expenditure symbolizing the state costs of contributions for employee’s retirement, health benefits, OASDI, and non-industrial disability leave advantages.
Policy Adjustments: The changes to existing law or Administration policies. Such adjustments need action by the Governor and/or Legislature and change the workload budget.
Following equations denote market for widgets Demand: P = 10 - Q Supply: P = Q - 4 Here P mentions the price in dollars per unit and Q mention the quantity in thousands of units. A
1. How would you fund the tranche Z of the example in the securitization manual? 2. What reinvestment rate from the excess spread will guarantee that there will be sufficient money to pay0ff creditors of tranche Z? 3. When tranche Z creditors will get
Detail of Appropriations and Adjustments: A budget display, for each association, that replicates appropriations and adjustments by fund source for each of the character of expenditure, (that is, State Operations, Local Assistance, and Capital Outlay)
Out-of-State Travel (OST) blanket: The request by a state agency for Governor’s Office approval of the proposed out-of-state trips to be taken by that agency’s personnel throughout the fiscal year.
Why do we focus on cash flows rather than profits while evaluating proposed capital budgeting projects? We targeted on cash flows instead of profits while evaluating proposed capital budgeting projects since it is cash flow that changes the valu
18,76,764
1945403 Asked
3,689
Active Tutors
1456948
Questions Answered
Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!