# Applying Probability in Business (Pt.2)

Written by Franklin Osuji Onuwa · 1 min read

PROBABILITY IN FINANCE:

The probability for a company to get a working capital loan. First, the Bank/ Lending company must put the company/ interested borrower through various tests. The company must present its current cash flow and cash flow projections. Also, submit their bank statements for the past full year. The interested party must also go through a series of interviews and meetings with the lenders to prove their technical know-how in the business seeking the loan. The probability of a company getting a loan will depend on how well they ace these metrics they are being measured with and succeed to convince the bank/ lender that they are qualified and responsible enough to take on the loan.

PROBABILITY IN MARKETING:

The probability of a marketing tactic- sales incentives to push sales of a particular product. Sales incentives tend to sensitize customers to encourage them to buy a product, either as a first-time buy or repeat purchase, depending on the period. The probability of a sales incentive to increase sales of a product/ company depends on some key factors. Is the incentive motivating enough to push the customer to purchase such products? Will it cause a major shift in the manner the product being marketed is perceived? What is the quality of the product compared to the competitors?

These factors help the customers make informed decisions that will determine whether the product sales will be marketable or not.

PROBABILITY IN OPERATIONS:

The probability of a working formula to boost workers’ productivity.  For example, some manufacturing/ producing industries run 1 shift or 2 or 3 shifts, depending. The probability of a soap-producing company switching from a 3-shift work mode to a 2-shift or 1-shift will depend on some key factors. Do they have as many customers’ orders to produce as they have in peak periods? What is the current capacity of their work machines to churn out products? Is there a decline in sales? Do they have enough working capital to purchase the required quantity of raw materials that will enable the run consistently in production? If they don’t. the company may decide to switch to 1 shift per day. This will help them curb costs in production and manage scarce resources efficiently.

PROBABILITY IN LOGISTICS:

The probability that introducing transport as an incentive will help boost sales depends on some factors. Will the incentive reduce the landing cost of the product for these wholesale customers? Is the incentive attractive enough for the caliber of customers you have? Is the incentive attractive enough to encourage new customers to patronize you and repeat purchases?

PROBABILITY IN MANAGERIAL DECISIONS:

Probability of my decision to push the company forward. For example, my company must decide how to handle old debts and focus on current suppliers to aid production and maintain a healthy cash flow. My main aim is to continue production and workflow seamlessly without any hindrances. Anything that will hinder workflow should be eliminated. Will I be needing the services of this supplier in the nearest future? The probability of this decision to push my company forward and continue workflow seamlessly depends on how well I execute my plan.

Thank you!

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