Woolies Is a Large Consumer Goods Company That Has Been

question 53

Essay

Woolies is a large consumer goods company that has been experiencing a decline in sales over the last three quarters.At the next monthly operations cycle,the management will take some major steps to restrict the drop in sales and regain some of its lost market share.The marketing manager believes that the low sales from some of its products has been neutralizing the effects of its quick-selling goods and that these low-selling products must be deleted from its product mix.What are the options available to the management of Woolies with regard to its products that are faring badly in the market?

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Definitions:

Unrealized Loss

A loss that occurs on paper when the current market value of an investment is lower than its cost but has not been actualized through a sale.

Available-For-Sale Securities

Financial assets held by a firm that can be sold in the financial markets, not classified as held-to-maturity or trading securities.

Stockholders' Equity

The residual interest in the assets of a corporation after deducting its liabilities.

Trading Securities

Financial assets that a firm holds primarily for the purpose of selling them in the short term to profit from price fluctuations.