Long term profit maximization for Bartlett Milling Co
Bartlett Milling Co is among the wheat producing companies in the USA. Bartlett Milling Co operates in a free market as there exists various whet producing companies and so the lack of monopoly. Bartlett Milling Co experiences perfect and free competition. A free market is characterized by the policy that profit maximization is increasing the difference between revenue and production cost. Suppose Bartlett Milling Co can ensure it minimizes its production cost and maximize its revenue then the company is maximizing its profits. In other words, profit maximization is achieved suppose a Bartlett Milling Co’s revenue is greater than its production cost.
In the free market structure, Bartlett Milling Co can achieve product maximization in the long run by decreasing production cost or increasing the market price of its products. However, since there is perfect competition in the USA as it is a free market, Bartlett Milling Co would lose its market share suppose it increases its prices and so this is not a better strategy. The company, Bartlett Milling Co, has to reduce its production cost. One method Bartlett Milling Co can use in reducing its production cost is through having direct access to the market where middle men are minimized. The other way of profit maximization is through increased sales and this can be achieved by increasing its product distribution and enhancing marketing both in the USA and abroad. The increased distribution will lead to increased sales. Increased marketing will ensure customers are aware of the product and the advantages customers get from the product compared to competitors. This is a long term strategy.