Adjust the transfer pricing rate and logistics priority. This activity was also aiming at reducing the overall cost. Because of the big loss in late phase 1, a large number of loss carry forward was left, which means no tax would be needed to pay if the pretax profit was lower than this number. Thus, Orange adjusted the transfer pricing rate to meet the loss carry forward so that could avoid tax payment, yet without increasing the selling price. On the logistics aspect, Orange followed a principle of “Produce locally and sell locally”. Orange satisfied the local market where the specific product line located preferentially, in order to minimize the transportation cost and tariffs.
Briefly summary of strategy
our company followed a price-leading strategy during the whole competition, and combining with differentiation as well if necessary. Although Orange made a big loss at the middle of the competition because of some decision-making errors, the positive thing is the strategy was adjusted in time and took the market share again. Low price was the leading principle through the whole progress, and other strategies and adjustment, such as differentiation strategy (more additional feature on new productions) logistics adjustment, were to help to achieve the low price strategy successfully.
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...payment had been paid to the shareholders therefore it is predictable that our final shareholder return would be relatively low.
Despite the company focuses was on a differentiation strategy, low price leading strategy is evident during the eight rounds. Company has implemented different kind of strategies interchangeably in terms of it is products, productivity, marketing and logistics decision making. Company has experienced considerable financial lost for around six rounds. However, company made some profit in the course of latest rounds specifically round 7th and round 8th respectively, a tremendous investments on research and development as well as rising new equity shares were of course enabled company to withstand the fierce competition within it universe groups, particularly, when there was a price war competition applied.
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