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The Analysis of Samsung Economy

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Since 1938 to the present day, Samsung is one of the major electronics companies worldwide in the IT sector (Samsung, 2013). Beginning in Korea, it is now spreading internationally. Samsung specialized in digital devices, including laptops, televisions, microwaves and fridges, electronics, semi-conductive equipment and network connectivity (Samsung, 2013).

Samsung, which is more than a century old, revealed a decrease over the sale of its smartphones to maximize their profit because the other goods show a decreasing deal, such as home appliances and LCD TV. Since 2013, the earnings from Samsung have reduced production. Despite being the biggest company in the world in the production of smartphones, it can no longer deny the pressures it keeps receiving from the market.

Samsung’s devices also showed a considerable decrease in income and demand for their smartphones in this year’s second quarter. As you can see below, the salary for Samsung fell from 2013, and in the second quarter of this year was the worst.

How to increase demand for Samsung smartphone

Samsung should take on many things, like offering a competitive price on the global market, to regain its declining request. While the number of smartphone customers continues to increase, the company finds it increasingly difficult for its heavy-end technologies to tap into new markets. Suggests that the company must minimize its prices to sell these gadgets. Nevertheless, profit margins tend to be rising.

MARKET

Samsung offers a range of products that are characterized by high quality and receptivity to customer requirements and preferences. Compared to its competitors, this advantage places the company in the lead. Samsung took the industry by surprise and was able to gather the highest level of market share with the launch of innovative and unique goods. In contrast with the company’s success competitors, the following table summarises Samsung’s global market share.

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UTILITY

Consumer behaviour reflects the usefulness of certain commercial services and products. Due to their transitive, full and constant preferences, they have a profound depiction of utility. Each consumer hopes to be happy with the buy and more excellent efficiency for the goods or services obtained by a customer. This aspect makes executives aware of the competitiveness because consumers carefully evaluate the brand and purchase the product, which provides more usefulness. When talking about utility, three different types of services, form, time and location, should be referred to the efficiency. In turn, suppliers will seek to supply and continuously improve the goods, as the overall quality of the product is increasing. (‘Investopedia’)

MARGINAL UTILITY DIMINISHING

See an example of a customer purchasing a Samsung computer or a mobile phone. In this case, a buyer sees the goods they bought of particular functionality. When a customer wants to buy an alternative product after the first transaction, the perceived benefit declines, which is less than the presumed usefulness after the first purchase, the argument that purchasing any drug of the same kind does not satisfy any additional factor will clarify that. The service decreased to zero (0) or even below (0 >) if the individual purchases the 3rd goods. Let’s see another case of an insurance company having four screens. The company will not have to purchase additional monitors if four display is required. Thus, the customer’s marginal usefulness is near zero, and the company will not discover any use for a new screen.

Microeconomic principles are related to the rule of decreased marginal value and the law of production. So the manager should reduce the prices of the product so that customers can get utility out of buying them to maintain always high sales. Managers should, therefore, recognize why customers receive additional service. The German economist Mr. H. Gossen invented the Principle of the Marginal Value, which explains a significant phenomenon in human behaviour. Alfred Marshal reaffirmed that law with the following words:’ Whenever there is an increase in a person’s stock, the additional benefit decreased. (Economy’)

SUPPLY ELASTICITY PRICE

Price elasticity is the degree to which the amount of commodity produced reacts to price movements – increases or decreases in the price of the product. The further elastic the quality, the more sensitive are price changes for manufacturers and retailers (Moffatt, Mike). For Samsung firms, there is little negotiating capability for manufacturers because Samsung manufactures both TVs and mobile phones. Samsung has been one of five TV producers and one of the top global three smartphone producers. Samsung Electro-Mechanics, Samsung SDI, Samsung Coring Precision Materials and Samsung SDS are part of Samsung, which produces Screen and cell phone elements. Because it does not have to rely on specific providers, Samsung can thus adjust its production activities and boost the delivery of TVs and cell phones where appropriate. In 2010, for instance, Samsung was pressured in the short term to raise Television production from 39 million systems to 50 million orders to meet the increasing demand (Choi, Kyong-Ae). Samsung, however, flourished in growing food production and sale because it did not rely on vendors and therefore was able to meet high demands.

Samsung electronics, therefore, have relatively short production lead times and therefore, consumers and distributors of Samsung You must not wait a long time before the goods are received. The significant stores of Samsung, including Best Buy, Dan’s TV, Systems and Excel Computer Systems, are looking forward to making a large number of orders. Nonetheless, Samsung couldn’t meet such a large electronic equipment request if it wasn’t quick enough to boost output volumes (‘Authorized Samsung Resellers’).

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The Analysis of Samsung Economy. (2022, Jun 09). Edubirdie. Retrieved December 5, 2022, from https://edubirdie.com/examples/the-analysis-of-samsung-economy/
“The Analysis of Samsung Economy.” Edubirdie, 09 Jun. 2022, edubirdie.com/examples/the-analysis-of-samsung-economy/
The Analysis of Samsung Economy. [online]. Available at: <https://edubirdie.com/examples/the-analysis-of-samsung-economy/> [Accessed 5 Dec. 2022].
The Analysis of Samsung Economy [Internet]. Edubirdie. 2022 Jun 09 [cited 2022 Dec 5]. Available from: https://edubirdie.com/examples/the-analysis-of-samsung-economy/
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