Law of diminishing marginal utility.
As I have a 3 years experience in berger paints india ltd. So i will try to releate law of diminishing marginal utility with experience of berger paints.
Why there is a limited amount of workforce in particular sales territory?
As berger paints was there in bhutan, with bhutan Darjelling and sikkim was in same territory. I was there a single sales officier to take care of my clients from tip to bottom i.e account reconciliation, client visit of dealer and distributor, talking with promoters. So company didnot put much employee in that territory, may the output of the company may improve but the cost of living of a individual in hilly reasons is high, company has to able all the cost.
Secondly a paint company dealer does business with may products like marble, cement, rod, sanitary fitting etc.
So the dealer and the distributor has to deal with all the company person for scheme, offers, cn (credit note) dn (debit note) etc. If berger paints put for example more 5 sales officer in that terrain. The respective officers have to visit to the counters frequently, the client may take it as a monotonous activity after a time being, the client will response but after sometime, when the client will fullfill the business target of paints he will start giving less importance to the company and the company person, because the visit will increase with less productivity because the size of the particular market doesnt require 5 sales officer after that also if company put the officer the above problems will take place because without any effective work if the sales person sits and visit the shop then the dealer will also not response and company will also not have health business from particular counter, because i think of law of diminishing balance.
Economics when applied to real life sounds beautiful. this blog is for those students who are discovering the different facets of economics applications and want to share their discoveries.
Thursday, August 16, 2018
Law of diminishing marginal utility in berger paints
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