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Problems that SC Johnson is facing:
Oil base product
They manufacture insecticides which are oil based products due to increasing oil prices they are facing more cost of goods sold and severe competition in terms of pricing in the market.
Seasonal based products
Their business is seasonal based. In monsoon season when the use of insecticides increases simultaneously. Due to global warming the seasonal factors all around the are changing this is also a big problem for the company
.
Availability of smuggled product
Smuggling of SC JOHNSONs foreign products from the subsidiaries of parent company. This is another big problem for the company that it is facing. The smuggled products are available at retail stores on very cheap prices. This issue decreases the sales of the company because of its original higher prices
.
Bargaining power of suppliers
Bargaining power of local suppliers is much higher that results in an increase in cost of raw material and ultimate effect goes on price of the product which is much important for competition.
Threat of local inferior quality product
Threats of locally manufacture low price inferior quality product, because level of income of middle and lower middle class is low that's why these two classes prefer low priced and cheap products, no matter what the quality of product is. This problem threats the company and company faces problems in giving competing prices.
Insufficientbudgets for advertisement
Fewer budgets for advertisement. Company has no enough budgets for the advertisement of its products that's why product of company has no clear image in the mindset of consumer. And company is facing this problem as a result of low sales.
Decrease in disposable income
Due to decreasing disposable income in Pakistan people are not using luxury products. They are using only necessities. This problem is decreasing the demand for the products of the company. And company is facing the problem of excess stock and low production. In other words, company is facing difficulty in maintaining the economies of scale.
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