Jowie Inc. is one institution that entails providing products and services in the cosmetics industry. Keeping in mind that this is one growing industry, many firms are sprouting up to have a share in the large market of cosmetics products. However, this is no setback to make Jowie Inc. not to make its impact in this competitive market. Nonetheless, various factors will have to be acknowledged prior to launching this firm on a regional basis (Raheem, S. 2013). This discussion aims at analyzing the factors that would influence planning of the establishing of Jowie Inc.
The first factor that would greatly impact on planning the launch of Jowie Inc. would entail the amount of investment and the time it would take to enjoy returns. In essence, the larger the amount of capital invested then it logically follows that it is the higher the returns on investment will be realized but in quite a substantial amount of time which is estimated to be three-four years of existence. This is one factor that would be acknowledged prior to launching Jowie Inc.
Basing an argument on the fact that cosmetics is one growing product market, then it would be vital to understand that the various forms of advertisements that would be incorporated would also be an influencing factor in the planning process. This, in the cosmetics industry, generally describes the level unto which the returns to scale and the actual time that would be incurred in realizing the same. In the planning process therefore, it would be wise to acknowledge this factor comprehensively and allocate adequate resources as this to some extent would threaten the existence of the entity.
One major setback that many institutions face, is to determine which costs suit what type of investment (Raheem, S. 2013).This setback has even propelled the affected institutions to seek for services of financial experts in a bid to helping understand when to invest and on what projects. The area that is greatly affected by the type of decision to incorporate is the capital investment and this threatens the financial stability of any profit making institution.
If too much investments in terms of capital is injected on a short-run related activity, then this move could be described to have resulted from uniformed sources impacting negatively on the institution as a whole. This would be due to the sole reason that after the investment not even a single cent can be recovered as it will have already been paid.
In any institution, opportunity cost is one vital area that theseinstitutions ought to come across whether they like it or not. This type of cost is normally incurred when an enterprise is seeking greener pastures. Nonetheless, this type of business activity is one area that breed confusion with an eventuality of coming up with non-optimal decisions made by many businesses.
One popular scenario that describes this kind of non-optimal decision made from an opportunity cost, was a major “advancement” by mobile-service provider. A mobile service provider has decided to extend its services to mobile-banking sector foregoing the other crucial services it ought to be providing such as working on call tariffs. Consequently, the move proved unsuccessful and huge chunks of investments had been lost. The management on its end decided to continue pursuing that directive which in the long run ended up in the institution being terminated.
Raheem, S. (2013). ENTREPRENUERSHIP EDUCATION. Sustainable Development, 4(2), 9-19.