• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

City speed - There are 2 options that are currently available to you, the Board of Directors, the first is to purchase more vehicles in addition to the current fleet and the other is to expand to a new location from which to run the company.

Extracts from this document...

Introduction

CitySpeed Brief Introduction There are 2 options that are currently available to you, the Board of Directors, the first is to purchase more vehicles in addition to the current fleet and the other is to expand to a new location from which to run the company. New Vehicles Advantages The advantages of purchasing 15 low-floor easy-access buses are that it leads to a growth in the size of the current operating fleet. As can be seen from the benchmarking data although the current fleet size is bigger than our rivals, Destina, the average age of the fleet is double theirs. The introduction of new buses to the fleet will allow the customers to travel in more luxurious surroundings and so will increase the overall pleasure of the journey which is likely to lead to more people wanting to use our company's buses on a regular basis. The fact that these new low-floor easy-access buses operate as a fifth of Destina's fleet shows that they are a forward thinking company who are looking towards maintaining a greater market share by improving the level of customer satisfaction. ...read more.

Middle

The answer is probably not, as the majority of the fleet will still be rapidly ageing thus unreliable and uncomfortable so unsatisfactory for the customer. Is it also possible that these new buses will lower maintenance costs? Again probably not as the rest of the fleet will still be ageing with repairs growing increasingly more expensive so this problem is unlikely to be solved with such ease. The new vehicles also carry a high initial outlay and with gearing still at 40% wouldn't this present a problem in obtaining the necessary funds to purchase these new vehicles. The payback on this investment is also longer which could present a problem in a time of economic instability. The vehicles' expected life of 15 years is only half that of the new depot investment so more money will be needed sooner to pay for more improvements. New Depot Advantages As the company's position in our current market begins to weaken due to the increasing growth of our main rival, Destina, in the market place the possibility of moving our company to a new out of town purpose-built location would seem like a good option as it presents the opportunity to bring about a start to a whole new era for the company. ...read more.

Conclusion

that we was unable to repair with the new maintenance facilities we would be unable to replace due to having no reserves and also having a high gearing ratio it is unlikely banks would allow us to borrow from them. The fleet would still be considered out of date from a customers point of view compared to the relative youthfulness of the Destina fleet so passenger journey figures may decrease yet again as customers look for a much more appealing method of public transport to get them out of their cars which in this case would no doubt resort in them using Destina's new low-level easy-access so more convenient to travel on buses. Summary In summary I believe for our company to succeed in consolidating our position in the market place I believe that the most suitable option would be to invest in the new vehicles as this is the side of our company that the customer sees and feels so this is the aspect that we will be judged upon, and it is after all the customers that we are aiming to please to ensure they will keep using our buses. ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our GCSE Economy & Economics section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related GCSE Economy & Economics essays

  1. Toyota Motor Company Limited

    It sold 18,000 vehicles in fiscal 2002. Toyota plans to continue bolstering its manufacturing base in North America with a view to achieving production capacity of 1.45 million vehicles during 2003. As part of these efforts, it is currently constructing a plant in Alabama to supply V8 engines for the

  2. Case Study: The Home Depot

    In this study we will answer several questions with subjects ranging from strengths, weaknesses, opportunities and threats of Home Depot till the corporate culture and corporate strategies. The answers on these questions together will answer the overall question, which can be read in the next chapter.

  1. Evaluate the impact of Nike's outsourcing strategy and factory location on the host nation

    Another possible way Nike's multinational operations could have a positive impact on the Host countries is by providing education and training. Nike has helped increase education and training of employees by providing opportunities for contract workers to receive a higher education.

  2. Bellway Plc is a holding company with subsidiaries; its main subsidiary company is Bellway ...

    These policies have decreased reserves by �2,160,000 in 2004. These policies have overall improved the return on equity ratio and will affect the profitability of the company. Problems of Comparison The financial statements and ratio analysis of the companies do not accurately portray their performance in the industry.

  1. The current and future prospects of Virgin

    Aspects that affect competitive rivalry include industry growth, fixed costs, brand identity, and barriers to exit. The airline industry is intensely competitive. Industry growth is moderate, and carriers are struggling to take away share from each other. Barriers to exit are substantial in the airline industry.

  2. Investment Appraisal

    the resources are - the level of risk - personnel and human relations areas - the economy - the company image

  1. Liberalization: where it has lead us and where it is headed

    Another borrowing condition is "open" and "transparent" bidding for infrastructure projects. On the surface, these terms do not seem at all objectionable. But in the implementation, it can turn out that these are just more code words favoring the MNCs.

  2. The Famous Grouse - company profile and exports

    The sales of alcoholic drinks may have heavier restrictions in other countries and levels of sales may be limited to a certain extent by this. In France, for example, there are restrictions on the advertising of alcohol in sports venues, on the field or at the ground.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work