*** ACCA P3 December 2017 Exam was.. Instant Poll and comments ***

Part (a) 24 Marks
Part(b) 12 Marks
Part (c) 10 Marks

4 marks for presentation

Just wondering how could the Farming company a cash cow? I know it’s has the highest Market Share, but both the market size as well as the gross profit margin is declining significantly over the years, how can the company be a cash cow when the market size as well as the gross profit margin is dropping so much over the years?? it should be a dog rather than a cash cow

Hi!^^

Well i have been using bpp as my study material, but i haven’t seen such a cash cow company like Swiftdale Farm, with over 66% drop in GPM (i know it’s irrelevant) and the deterioration of market size over the years (as i remember cash cow should be in a slow market growth rate or slight decreasing right?) the only thing that correct about Swfitdale farm being cash cow is that it is the market leader.

But never mind, we still get marks for calculation and elaboration right?

@streetgold said:
For the Question 2, I pretty sure about my answer was correct.

The corporate parent NCBT was a electronic merge with another technology co
-the first co (Swiftdale Farm) is a cash cow with high market share and low market growth. it was also a allien biz under ashridge ( low feel , low benefit).

-the second co ( insurance) is a problem child/ question mark because he not holding the highest market share ( another competitors hold higher than it) and he has high market growth ) it was a value trap under ashridge ( low feel but high benefit)

– the 3rd co (Pait technology) which had semilar biz nature with parent is definitely a star with highest market share and market growth among the 3. Under ashridge it definitely is a heartland biz ( high feel and high benefit).

This is my analysis for questions 2. I just suprise that costing was appear in question 1 which is the only chapter that I skip, but overall this paper was ok and quite easy to attempt!!!!

Wish all of u can pass.

I Think Pait was actually low benefit because it was mentioned that it is doing well and has very experienced management, so limited opportunities to add value for ncbt. Therefore I chose ballast business.
For insurance business feel must be in line with potential benefit. Secondly i think that ashridge is used at the time of acquisition and CBB before and just after acquisition was very successful and needed no assistance. I chose alien business.

Perhaps I wrote wrong, but I choose allien for farm is becos, the cp main biz nature is technology which are never linked to Swiftdale farm ( agriculture), so it had low feel. Besides the cp no longer wanted to spend any investment, so it had low benefit.

Steer only relative market share and market growth should be consider only other thing cetrus paribus

Can someone plz tell me in q2 abt the bcg question why were there 18 marks as in for just calculting and identifying the relevant answer i.e dog cash cow etc for that u get 18 marks??

@acca6578 said:
6 marks for calculation and elabroation of each company by using bcg and ash model, identify the correct segment will grant you 0.5 or 1 mark i guess

6 mark for calcultions? Thats nice

@acca6578 said:
6 marks for calculation and elabroation of each company by using bcg and ash model, identify the correct segment will grant you 0.5 or 1 mark i guess

seems not realistic to have 6 mrks for calculation.its too much.

@anastassiya777 the farm couldn’t be a question mark. it was acquired in 1994 and performed very well from then. it had a high market share and the market growth was negative. It also was generating alot of cash inflow. That can only be a cashcow.

@vervemj said:
Hi- can you recall what you.wrote for strategy moving forward for these ? I wasnt sure what to say but said to get rid of the dog lol and perhaps the star to reduce price a little and try to take a bigger market share, kill off comp?

for dogs i wrote harvest whatever profits possible and improve cashflows by reducing the investment.

For all of those saying Farm was cash cow? What was the gross margin and turnover in year 2016? anyone remember? I tell u

Turnvoer: 90
Gross margin: 4

4.4% GP, how this company can be profitable? You guess by yourself.

@tayyabom said:
For all of those saying Farm was cash cow? What was the gross margin and turnover in year 2016? anyone remember? I tell u

Turnvoer: 90
Gross margin: 4

4.4% GP, how this company can be profitable? You guess by yourself.

Boston box model uses only two dimensions – MARKET SHARE and market growth rate.
it doesn’t consider the effect of cost, hence Gross Margin wont be affecting the result of BCG.