Measuring the Opportunity Cost of Late Access to the Market of Products
Keywords:
opportunity cost, late introduction, early introduction, product market, IraqAbstract
The purpose of this study is to measure the opportunity cost of late access to the market. This opportunity cost is measured by the percentage of sales or revenue loss from to 2018-2022 of an Iraqi textile companies. This opportunity cost gives more attention to an important factor in the decision process regarding market access, which is time to market. The study focused on one product of the companies that is cotton clothing as data were collected for the period 2018-2022 to calculate the percentage of sales or revenue loss due to the late introduction of this product to the market. This study adopts a model developed by Prasad (1997) with a market window of 30 days or one month, which was used by these companies. The results show that the opportunity cost increased during the period of the study because of late introduction of the products indicating that the firms will lose the market share for their competitors. The main implication of this study is that managers should make a decision to use the idle energy and introduce a product faster to maintain its market share and reduce the level of competition.
Downloads
References
Abidalreda, N. Y., and Jawad, S.A. (2019). Using Some of Quality Techniques in Supply Chain Management to Improve the Production Processes. International Journal of Supply Chain Management, 8(4), 772-787. https://doi.org/10.59160/ijscm.v8i4.3491.
Afonso, P., Nunes, M., nio Paisana, A., and Braga, A. (2008). The influence of time-to-market and target costing in the new product development success. International Journal of Production Economics, 115, 559–568. doi:10.1016/j.ijpe.2008.07.003
Ahmadi, T., Hesaraki, A.F., Mahmoodi, A. and Marandi A. (2025). Managing customer waiting times in an inventory system using Conditional Value-at-Risk measure. Annals of Operations Research 344, 1–45 (2025). https://doi.org/10.1007/s10479-024-06221-z
Alexopoulou, S., Balios, D., and Kounadeas, T. ( 2024). Essential Factors When Designing a Cost Accounting System in Greek Manufacturing Entities. Journal of Risk and Financial Management,17(8):366. https://doi.org/10.3390/jrfm17080366
Aljanabi, A. K., and Nouri, M.A. (2020). Responsible Accounting and Its Role in Achieving Competitive Advantage. International Journal of Innovation, Creativity and Change, 10(11), 577-611. https://dhsjournal.id/index.php/SBAMR/article/download/24/12/#:~:text=Responsibility%20accounting%20is%20identified%20as,levels%20of%20the%20organizational%20structure.
ALobaidi, S.H.D.J., and ALghabban, T.H.S.M. (2022). The Effect of Applying The Six-Sigma Approach On The Costs Of Activities of The General Company For Textile and Leather Industries. Journal of Positive School Psychology, 6(5), 3971-3990. https://journalppw.com/index.php/jpsp/article/view/6961
Al-Shboul, M. A. (2017). Infrastructure framework and manufacturing supply chain agility: the role of delivery dependability and time to market. Supply Chain Management: An International Journal, 22 (2), 172-185, https:// doi.org/10.1108/SCM-09-2016-0335
Avdullahi, A., and Fejza, V. (2015). The Role of Competitive Strategies on Developing a Strong Competitive Advantages. Research Journal of Economics, Business and ICT ,10(2), 1-5. https://ojs.journals.cz/index.php/RJEBI/article/view/710
Belay, A.M., Kekäle, T., and Helo, P. (2011). Time-to-market and concurrent engineering in product development processes. International Journal of Innovation and Learning, 10(1), 60-84. Time-to-market and concurrent engineering in product development processes
Bhuiyan, N. (2011). A framework for successful new product development. Journal of Industrial Engineering and Management, 4(4), 746-770, https://doi.org/10.3926/jiem.334
Blackman, I.D., Holland, C.H.P., and Westcott, T. (2013). Motorola’s global financial supply chain strategy. Supply Chain Management: An International Journal, 18(2), 132–147. DOI 10.1108/13598541311318782.
Bylykbashi, S., Roehrich, G., and Assala, K. (2021). How to Measure Competitive Intensity? European Journal of Economics, Law and Social Sciences, 5(1), 22-42. chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/https://brest-bs.com/wp-content/uploads/2022/01/BYLYKBASHI.S_How-to-measure-competition-intensity-EJELS.pdf
Carvalho, H., Naghshineh, B., Govindan, K., and Cruz-Machado, V. (2022). The resilience of on-time delivery to capacity and material shortages: An empirical investigation in the automotive supply chain. Computers and Industrial Engineering,171, 108375. https://doi.org/10.1016/j.cie.2022.108375
Correia, R.J., Dias, J.G., and Teixeira, M.S. (2021). Dynamic capabilities and competitive advantages as mediator variables between market orientation and business performance. Journal of Strategy and Management, 14(2), 187-206. https://doi.org/10.1108/JSMA-12-2019-0223
Deherab, M.S., and Yaquoop, F.A. ( 2020). Management accounting techniques in product development and achievement customer requirements by adopting the technique of Quality Function Deployment Applied Research in Baghdad Company for Soft Drinks. Journal of Accounting and Financial Studies, 15(51), 36-58. https://repository.uobaghdad.edu.iq/articles/jpgiafs-908
Do, T.H., Le, H.M., Luong, D.T.T., and Tran, Q.T. (2020). Relationship between the Management Accounting Information Usage, Market Orientation and Performance: Evidence from Vietnamese Tourism Firms. Journal of Asian Finance, Economics and Business 7(10), 707–716 doi:10.13106/jafeb.2020.vol7.no10.707
Dominguez, R., and Cannella, S. (2020). Insights on multi-agent systems applications for supply chain management. Sustainability, 12 (5), Article No. 1935, doi: 10.3390/su12051935.
Du, Z., Fan, Z-P. and Chen, Z. (2023). Implications of on-time delivery service with compensation for an online food delivery platform and a restaurant. International Journal of Production Economics, 262, 108896https://doi.org/10.1016/j.ijpe.2023.108896
Dündar, A.O., and Öztürk, R. (2020). The Effect of On-Time Delivery On Customer Satisfaction And Loyalty In Channel Integration. Business and Management Studies: An International Journal, 8(3), 2675-2693, doi: http://dx.doi.org/10.15295/bmij.v8i3.1520
Elyazid, S. (2016). Performance Measurement: Quality, Cost, and Time Is New System: So Called Strategic Cost Management .Research Journal of Finance and Accounting, 7(17), 1-11. chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/https://core.ac.uk/download/pdf/234631808.pdf
Faris, H.M., and Maan, H.Y. (2020). Evaluation of Green Supply Chain Management Practices Under Uncertainty Environment: Case Study in The Company for Batteries Industry. 3rd International Conference on Sustainable Engineering Techniques (ICSET 2020. IOP Conf. Series: Materials Science and Engineering IOP Conf. Series: Materials Science and Engineering. IOP Publishing doi:10.1088/1757-899X/881/1/012085. http://dx.doi.org/10.1080/00207540802642245
Gallino, S., Karacaoglu, N., and Moreno, A. (2022). Need for Speed: The Impact of In- Process Delays on Customer Behavior in Online Retail. Operations Research, 71(3), 876-894. https://doi.org/10.1287/opre.2022.2262
Guzik, A. (2023). Overview of new product development strategies and models. Catallaxy, 8(1), 21–34. https://doi.org/10.24136/cxy.2023.002.
Hadi, R., and Farhod, S.F. (2018). The role of TD-ABC approach in decreasing of cost per unit Applied study in the General Company of Hydraulic Industries Plastic Factory. Journal of Accounting and Financial Studies,13(45), 96-107. https://doi.org/10.34093/jafs.v13i45.316
Haghpour, B., Sahabeh, E., and Halvari, H. (2022). Opportunity cost in consumer behavior: Definitions, operationalizations, and ambiguities. International Journal of Consumer Studies, 46, 1942–1959. DOI: 10.1111/ijcs.12842
Hamali, S., Nurfanka, A.G.R., Firdausi, A.M., and Setiawati, M.S. (2020). Evaluation of the delayed fiber optical installation project on pre-sales division at PT XYZ. IOP Conf. Series: Earth and Environmental Science IOP Conf. Series: Earth and Environmental Science 452 (2020) 012081 IOP Publishing IOP Publishing doi:10.1088/1755-1315/452/1/012081 doi:10.1088/1755-1315/452/1/012081 1 1
Hashai, N. and Markovich, S. (2017). Market Entry by High Technology Startups: The Effect of Competition Level and Startup Innovativeness. Strategy Science, 2(3):141-160. https://doi.org/10.1287/ stsc.2017.0033
Hélène, D.B., Norontsoa, A., Helgina, S., Chiara, C., Noro, R., and Bezaka, R. (2016). Improving access to market information: a driver of change in marketing strategies for small producers? Paper prepared for presentation at the 149th EAAE Seminar ‘Structural change in agri-food chains: new relations between farm sector, food industry and retail sector’ Rennes, France, October 27-28. chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/https://agritrop.cirad.fr/584174/1/David-Benz%20et%20al%20_Improving%20access%20to%20market%20information_EAAE%2016%2009%202016.pdf
Hendricksn, K., and Singhal, V.R. (2008). The Effect of Product Introduction Delays on Operating Performance. Management Science, 54(5), 878-892. DOI: 10.1287/mnsc.1070.0805
Hilmersson, M., Schweizer, R., and Chetty, S. (2022). The Relationship Between Timing, Speed, and Performance in Foreign Market Network Entry. Management International Review, 62,325–349 https://doi.org/10.1007/s11575-022-00470-5
Hlatshwayo, S.I., Ojo, T.O., Modi, A.T., Mabhaudhi, T., Slotow, R., and Ngidi M.S.C. (2022). The Determinants of Market Participation and Its Effect on Food Security of the Rural Smallholder Farmers in Limpopo and Mpumalanga Provinces, South Africa. Agriculture, 12(7), 1072. https://doi.org/10.3390/agriculture12071072
Islam, T., Meade, N., and Sood, A. (2022). Timing Market Entry: The Mediation Effect of Market Potential. Journal of International Marketing, 30(1), 40-54. DOI: 10.1177/1069031X211068072
Ji, X. and Abdoli, S. (2023). Challenges and Opportunities in Product Life Cycle Management in the Context of Industry 4.0. Procedia CIRP, 119, 29–34. https://doi.org/10.1016/j.procir.2023.04.002
Johanson, J., and Johanson, M. (2021). Speed and synchronization in foreign market network entry: A note on the revisited Uppsala model. Journal of International Business Studies, 52: 1628–1645 https://doi.org/10.1057/s41267-021-00407-4
Kanagal, N.B. (2015). Innovation and product innovation in marketing strategy. Journal of Management and Marketing Research,18, 1-25. chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/https://www.aabri.com/manuscripts/152209.pdf
Karim, M.A., Samaranayake, P., Smith, A.J.R., and Halgamuge, S.K. (2010). An on-time delivery improvement model for manufacturing organisations. International Journal of Production Research, 48(8), 2373-2394. https://doi.org/10.1080/00207540802642245
Keel, G., Savage, C., Rafiq, M., and Mazzocato, P. (2017). Time-driven activity-based costing in health care: A systematic review of the literature. Health Policy, 121(7), 755–763. doi:10.1016/j.healthpol.2017.04.013
Khudhur, T.S., and Ali, H.S. (2019). Role of Project Managers Skills in Supply Chain Management of Small Project's Marketing. International Journal of Supply Chain Management, 8(1), 488-502. https://www.researchgate.net/publication/332448230_Role_of_Project_Managers_Skills_in_Supply_Chain_Management_of_Small_Project's_Marketing
Knudsen, M.P. von Zedtwitz, M. Griffin, A and Barczak, G. (2023). Best practices in new product development and innovation: Results from PDMA's 2021 global survey. Journal of Product Innovation Management, 40:257–275. DOI: 10.1111/jpim.12663
Lameijer, B. A., Boer, H., Antony, J., and Does, R. J. M. M. (2021). Continuous improvement implementation models: a reconciliation and holistic metamodel. Production Planning & Control, 34(11), 1062–1081. https://doi.org/10.1080/09537287.2021.1974114
Magingxa, L.L., Zerihun, G.A., and D van Schalkwyk, H. (2009). Factors influencing access to produce markets for smallholder irrigators in South Africa. Development Southern Africa, 26(1), 47-58, DOI: 10.1080/03768350802640081
Martel, J. (2018). Quality, price, and time-on-market. Economics Letters, 171, 97-101. https://doi.org/10.1016/j.econlet.2018.07.025
Maseer, R.W., Zghair, N.G., and Flayyih, H.H. Relationship Between Cost Reduction and Reevaluating Customers' Desires: The Mediating Role of Sustainable Development. International Journal of Economics and Finance Studies 2022; 14 (04), 330-344. doi:10.34111/ijefs. 20220116
Moher, A., Batsakis, G., and Stone, Z. (2018). Explaining the effect of rapid internationalization on horizontal foreign divestment in the retail sector: An extended Penrosean perspective. Journal of International Business Studies, 49, 779–808. https://doi.org/10.1057/s41267-017-0138-0
Nohýnková, B. (2022). Calculation of the Lost Profit in Business Damage Cases. European Financial and Accounting Journal; 1, 25-44. https://doi.org/10.18267/j.efaj.266
Pascucci, F., Savelli, E. and Gistri, G. (2023). How digital technologies reshape marketing: evidence from a qualitative investigation. Italian Journal of Marketing, 1, 27-58, https://doi.org/10.1007/s43039-023-00063-6
Persson, E., and Tinghög, G. (2020). Opportunity cost neglect in public policy. Journal of Economic Behavior and Organization, 170, 301-312. https://doi.org/10.1016/j.jebo.2019.12.012
Prasad, B. (1997). Analysis of pricing strategies for new product introduction. Pricing Strategy and Practice 1997; 5(4), 132-141. https://doi.org/10.1108/09684909710184626
Prasad, B. (1998) A method for measuring total value towards designing. The TQM Magazine, 10(4), 258-275. https://doi.org/10.1108/09544789810222621
Puente, C.A.S.C., Gamarra, J.P.L.W., and Flores, R.M.V. (2023). Application of the Abc Methodology to Reduce the Delay of Sales Orders in A Company Warehouse in Barranca City. Proceedings of the 4th South American Conference on Industrial Engineering and Operations Management Conference, Lima, Peru, May 9-11, 2023 © IEOM Society International. chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/https://cris.ulima.edu.pe/files/43762608/Proceeding_Peru_77.pdf
Ravula, P. (2023). Impact of delivery performance on online review ratings: the role of temporal distance of ratings. Journal of Marketing Analytics 2023; 11,149–159 https://doi.org/10.1057/s41270-022-00168-5
Rycroft, R.W. (2006). Time and technological innovation: implications for public policy, Technology in Society, 28(30),281–301. https://doi.org/10.1016/j.techsoc.2006.06.001
Salmen, A. (2021). New Product Launch Success: A Literature Review. Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, 69(1), 151–176. https://doi.org/10.11118/actaun.2021.008
Shannak, R.O., and AL-Masri, A. (2012). The Relationship between TTM (Time To Market) Tool and Evaluating the Performance of Products’ Launching Process: A Case Study of Orange Jordan. European Scientific Journal, 8 (17), 114-135. https://www.researchgate.net/publication/257922749_The_Relationship_between_TTM_Time_To_Market_Tool_and_Evaluating_the_Performance_of_Products'_Launching_Process_A_Case_Study_of_Orange_Jordan
Shi, Z., Li, Y., and Lu, C. A study on optimization of delayed production mode of iron and steel enterprises based on data mining. PLoS ONE, 18(1), e0278750. https://doi.org/10.1371/ journal.pone.0278750
Suherly, H., Affif, F., Arief, H., and Guterres, A.D. (2016). Marketing Performance as the Impact of Marketing Mix Strategy (7P) with Determination of Market Attraction and Company’s Resources: Survey on Performance of Tourism Industry in Timor Leste. International Journal of Economics, Commerce and Management, IV (9), 569-587. chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/https://ijecm.co.uk/wp-content/uploads/2016/09/4937.pdf
Vallejo‑Torres, L. (2023). The Broader Opportunity Costs in the Broader Cost‑Effectiveness Analysis Framework. Applied Health Economics and Health Policy 21:373–384 https://doi.org/10.1007/s40258-023-00801-z
Yamin, M., and Kurt, Y. (2018). Revisiting the Uppsala internationalization model: social network theory and overcoming the liability of outsidership. International Marketing Review, 35(1), 2–17. https:// doi:10.1108/IMR-11-2014-0345
Yang, J. (2023). Research on After-sales Problems in the Express Delivery Industry. F. Cao et al. (eds.) Proceedings of the 2023 5th International Conference on Economic Management and Cultural Industry (ICEMCI 2023) Advances in Economics, Business and Management Research 276, https://doi.org/10.2991/978-94-6463-368-9_84
Zhan, L., Shu, H., Zhou, X., and Lin, X. (2022). A Quality Decision Model Considering the Delay Effects in a Dual-Channel Supply Chain. Sustainability, 14(10), 6240. https://doi.org/10.3390/su14106240
Zhao, M., and Ghasvari, M. (2021). Product design-time optimization using a hybrid meta-heuristic algorithm. Computers & Industrial Engineering, 155, 107177. doi:10.1016/j.cie.2021.107177
