Notesale: Turn your study into money

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Unit 39

Assignment 3

a) Outline how an increase in government spending on schools and colleges IT equipment
and support packages might affect PC World
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Introduction
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They pay people
benefits for their services such as EMA, by employing staff for positions such as teachers, and by
rewarding businesses with contracts for the sales they make with them like providing and delivering
IT equipment and electronics
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3
million visitors per month
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PC World is a strong and worthy business and has progressed enough
with government sales to earn any government contract to supply the IT equipment they need
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Then I will explain
the short and long run reactions PC World would make to this rise in spending
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) When a business such as the NHS has a rise in government spending, when they want to
spend £30 million to place large orders for IT equipment and support packages, the effects
made upon companies such as PC World will involve their sales, revenues and profits
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They do
this by researching which company has the best quota
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g
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5 million
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

When PC World accept, they will attempt to fulfil the request by using their staff to help
deliver the equipment, along with an invoice of what is bought and the amount due from the
customer to pay for the delivered goods
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When facing an order like this, PC World’s sales would clearly increase because of the income they
receive, as well as their revenue also rising greatly due to the size of the placement
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b
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With both of these depending on different deadlines for delivery, the
company can either give small or large reactions
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Short run
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Since the
short run can mean up to a year, they would end up with smaller reactions than those of the long
run:
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Since the NHS needs to choose a business, to win them over to receive the order, PC World could
offer a complimentary discount to them if they were chosen
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In order to perform this request while also handling ordinary customers, PC World would need
to take on more staff to perform the delivery, but would also sign them a temporary contract
since they are only needed for NHS’ order and would leave the business once the order is
complete
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Their suppliers would have higher sales too because they would have increased orders from PC
World to provide the equipment they need for the NHS
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Because PC World has to handle their regular customers as well as the NHS, they should set up a
special business team who can liaise with this customer
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They would make agreements on delivery and installation dates and
converse whether PC World can continue making arrangements with other business customers
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Afterwards, the temporary staff and special team would be let go, the business would have
already earned enough money with their receiving income and amount made with their usual
customers, to make up for the discount they had offered at the start as well as the amount of income
paid to their suppliers
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ii
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There are also a number of different ways for PC World to react to the NHS order with in the long
term
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If they give a good enough performance, the business should try to settle
with more contracts with the NHS in the future, perhaps over a few years
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A better deal would be to become their ‘preferred contractor’, so
that if the NHS had any problems with their IT equipment, they could rely on PC World to help
sort them out
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These may be worth much more than the actual computers they are delivering
because if they win the consultation, maintenance and support package contracts with HSFC,
they will attract many more orders from other business customers and gain the opportunity for
very high income
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These staff
would stay with the company longer and can even assist with future orders if their performance
is satisfactory
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Only this
team should follow these contracts, otherwise too much time will be spent and will keep the
company from serving other customer
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This is a big deal with the NHS, and PC World will depend a lot on their suppliers
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Friendly relationships
such as this can also have their suppliers giving the business a discount, making it even easier to
gain more gear and save income
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If this happens, they should set up a special public sector marketing
department which specialises on making deals with administration companies such as council

offices, police, schools/colleges, the Army, the DWP, etc, in order to beat competition and win
over contracts
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Extensive business like this can lead to PC World
purchasing more with their profits and using more of their staff, but can give them the
opportunity to increase the size of their companies, leaving multiple PC World’s to have separate
contracts, widening their franchise, sales, location and profits
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The money from these would increase their gross profit and can help them
afford to form larger warehouses for bigger business
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Because it is the government which
increases spending for other businesses, PC World make indirect sales with them
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Conclusion
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Also, if everything is successful
when achieving the order then higher income is made, it can lead to forming contracts with
businesses and strengthen the position of the company
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The deals they make with schools and colleges will be a good example for other agencies
to be interested, making PC World a worthy company

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