Elle Appliances has recently released its "Elite" cooking range. The cooking appliances were advertised extensively with offers for early-bird buyers and assured refunds if the goods were found defective. This resulted in a lot of hype surrounding the goods and high levels of projected demand in the market. However, after its release in the market, the products failed to substantially add to the company's profits. When the venture failed to recover even the minimum projected returns, the marketing manager blamed the production department for the delays in production, while the production manager claimed that he was doing his best to dispatch stock on the predetermined days. Which of the following best explains the failure of this venture by Elle?
A) The company priced the "Elite" cooking range at relatively low rates.
B) The company minimized its operating costs by using efficient production techniques.
C) The company followed a low inventory system.
D) Elle was a reputed company which enjoyed the loyalty of customers.
E) Elle had recently acquired one its major rival firms.

Question

Quizplus · Accepted Answer

The failure of the venture is most likely due to the company following a low inventory system. This means the company did not stock up on excess inventory and instead relied on producing goods as per demand. However, due to delays in production, the goods failed to reach the market on time, leading to missed sales opportunities and customer dissatisfaction. This could have resulted in the failure of the product to add to the company's profits, even with extensive advertising and promised refunds.

Elle Appliances Has Recently Released Its "Elite" Cooking Range