Question
Question 1. A series of independent company operations are provided below: 1. Bright Box Corporation manufactures corrugated cardboard boxes. It competes and plans to grow
Question 1. A series of independent company operations are provided below:
1. Bright Box Corporation manufactures corrugated cardboard boxes. It competes and plans to grow by selling high-quality boxes at a low price and by delivering them to customers quickly after receiving customers orders. There are many other manufactures who produce similar boxes. Bright Box believes that continuously improving its manufacturing processes to improve productivity and efficiency is critical to implementing its strategy.
2. Smithy Corporation is a small information systems consulting firm that specializes in helping companies implement sales-management software. The market for Smithys products is very competitive. To compete, Smithy must deliver quality service at a low cost. Smithy bills clients in terms of units of work performed, which depends on the size and complexity of the salesmanagement system.
3. Le Petit Escargot is a chain of restaurants specialising in traditional French cuisine. Its aim is to provide customers with a comfortable dining environment while providing the best customer service. Being situated primarily in the suburbs, Le Petit Escargot has proven to be very popular due to its convenient locations.
REQUIRED: A. For each of the above businesses, state whether the business is following a low cost or differentiation strategy and explain why.
B. For each business, identify two pieces of management accounting information that can be provided to assist the company in pursuing its strategy identified in requirement A.
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