LG sales plunge
The international electronic conglomerate, LG electronics, brought down the targets of its phone in a bid to increase sales. The company has been consistently registering loss and reduction in sales in the past couple of quarters. In order to compensate the fall of profits by increase in volume, the company slashed rates worldwide. The company has said that it is difficult to say how long it will take for the company to bring sales back to normal and show a positive figure in their quarterly results. The reduction is cost is likely to have a positive effect on the company since the competition in the smart phone market is high and low costs can act as a crowd puller.
Sales targets reduced
Park Jong-Seonk, the head of the handset division of LG, said that the overall performance of the company has improved owing to the alterations in targets. He added that it is difficult to exactly predict the turnaround of the company since the market is highly competitive. Further, the scenario in the market is also on a steady change, with regular fluctuations in sales figures. While iphone and Android based phones rule the market as of now, with the decline of RIM Blackberry, sales will probably pick up in the coning quarters.
Samsung overtakes LG
Compatriot Samsung has done better than LG in terms of sale of smart phones. In a bid to counter its falling sales, LG has compromised on profits and produced a line of cheaper phones. LG is the third largest producer of phone sets in the world. Its range of low cost devices are expected to put the company back on its feet. The demand for low cost phones has increased drastically in the recent years.
Cut down in LG handsets
When compared to the estimated 30 million handsets in the beginning of 2011, LG is now targeting a sale of 24 million handsets. On the whole, the sales targets have been slashed from 150 million to 114 million worldwide. Sales seem to be picking up since the company sold more than 50 million phones in the first half of 2010. 10 million of them were smart phones. While the smart phone division of the company struggles, the low cost range has still got a good following.
A fifth quarterly loss for LG
Despite the reduction in sales target and promotion of low cost phones, LG is expected to register another quarter of loss. While the sales are picking up, the company seems to be brooding on reorganizing and rethinking about its smart phone market.