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Summary Business BDM Answer
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Summary study book Business Management for the IB Diploma Coursebook of Peter Stimpson, Alex Smith (Chapter 3) - ISBN: 9781107464377 (Business BDM Answer)
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BDM(d) Explain two problems, other than liquidity, for BDM, of rapid sales growth.
While rapid sales growth can be seen as an advantage in terms of maximizing profit, it can also be
seen as a problem. This is firstly because if BDM is unable to keep up with the rapid sales growth, it
could dissatisfy consumers, ultimately damaging the reputation or image of the company and likely be
less favoured by the consumers. BDM's inability to keep up may due to the insufficient workforce or
resources, which hinders them from producing more goods to keep up with the demand.
Another problem BDM could experience due to the rapid sales growth would be the decrease in its
products' quality. This is because if the company were to keep up with the continuously increasing
demand, BDM will have to produce more products quicker. This could lead BDM into prioritizing with
fulfilling the demand without paying attention to the quality of the products they are selling. When this
happens, the reputation of the company will certainly worsen and might cause BDM to lose customers
in the long run.
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