ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

OUTSOURCING AND BUNDLING STRATEGIES: ARMORS FOR SATURATED MARKET

Updated on October 2, 2012

Why companies bother to bundle and outsource? Are these moves necessary?


BUNDLING

Bundling is a necessity when the market you want to penetrate is already saturated and your resources are limited. In order for the company to stay in the market and compete with available resources bundling strategy is one of the answers. Below are few reasons why companies need to bundle?
It is another way to differentiate your product or services.
Offering a bundle product like Microsoft Suite/Office is another way of differentiation. Why it is differentiated? Because you offer a product that is unique or distinct, Microsoft Office offers not only Word but Excel, Powerpoint, Access, Publisher, Share point and the alike. More products bundle into one program.

A disguised for price-premium or mark up.

When one of your products is not sellable and offers a low profit margin then bundling it will help. Bundling it with an item that is hot on the market and set a premium price or mark up for that product. Consumers will never question the price because they will look at it as “A price for two in one”- An enticement for customers to buy your product without any question in mind.

Inventory Cost

As we all know that inventory is costly. It is directly proportional to the volume of your product and the storing time of your products in the warehouse, which means the bigger the volume of your products and the longer were stored in the warehouse, the higher your inventory expenditures. Inventory is inversely symmetrical to the sales of the product. If the sale and demand are low, then inventory is bigger. Bundling the not marketable product with a sellable item could lessen the inventory and at the same time generating sales to the "not hot" item.

OUTSOURCING

Outsourcing can be either good or bad for companies because there are some implications the company needs to endure such as loss of control of management, hidden costs, threat to security and confidentiality and quality problems. Moreover, the company is tied to the financial well-being of another company. So when is the right time the company will outsource? The answer varies. It is dependent on what your company needs most. If you want to focus on core activities and cost reduction, then outsourcing is the best option. The business entity should select the right company's activity that will be outsourced because once the quality of your products, for example, will be hampered, and it could cause loss in sales subsequently outsourcing is not advisable. If it can’t be avoided that the company needs to outsource because of lack of manpower, then outsourcing is a must. The company should hire another party, which will oversee and monitor these third party activities to ensure that the quality of the finished products will reach to its end consumer in good conditions and quality.
Finally, outsourcing is a case to case basis. It is dependent on the company's situation, needs and overall analysis.

Comments

    0 of 8192 characters used
    Post Comment

    • dwarfstar profile imageAUTHOR

      dwarfstar 

      7 years ago from California

      Thanks for the compliment. It's my pleasure to share it with my fellow hubbers. Goodluck and take care.

    • profile image

      Outsourcing Pros and Cons : Thom 

      7 years ago

      Nice strategies - I'm going to apply some of these concepts to my coaching program.

    working

    This website uses cookies

    As a user in the EEA, your approval is needed on a few things. To provide a better website experience, hubpages.com uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

    For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at: https://hubpages.com/privacy-policy#gdpr

    Show Details
    Necessary
    HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
    LoginThis is necessary to sign in to the HubPages Service.
    Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
    AkismetThis is used to detect comment spam. (Privacy Policy)
    HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
    HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
    Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
    CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
    Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the googleapis.com or gstatic.com domains, for performance and efficiency reasons. (Privacy Policy)
    Features
    Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
    Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
    Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
    Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
    Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
    VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
    PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
    Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
    MavenThis supports the Maven widget and search functionality. (Privacy Policy)
    Marketing
    Google AdSenseThis is an ad network. (Privacy Policy)
    Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
    Index ExchangeThis is an ad network. (Privacy Policy)
    SovrnThis is an ad network. (Privacy Policy)
    Facebook AdsThis is an ad network. (Privacy Policy)
    Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
    AppNexusThis is an ad network. (Privacy Policy)
    OpenxThis is an ad network. (Privacy Policy)
    Rubicon ProjectThis is an ad network. (Privacy Policy)
    TripleLiftThis is an ad network. (Privacy Policy)
    Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
    Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
    Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
    Statistics
    Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
    ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
    Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)