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Q. Financial Management in Marketing Department?
The marketing department of a firm is concerned with the ultimate activity of the firm Le. the selling of goods and services to the customers. The marketing department is entrusted with the responsibility of framing marketing, selling, advertisement and other related policies to achieve the sales target. It is also required to frame credit and collection policies to maintain and increase the market share, creating a brand name, to acquire a competitive edge, etc. Different policy decisions all of which have financial implications are to be taken. The finance manager has to play an active role in interaction with the marketing department in the process of these decisions.
For example, the marketing department should not arbitrarily relax the credit terms (just in order to increase the sales figure) as it may affect the liquidity position of the firm. The financial implications of the proposed advertisement policy, price-war maneuvers, liberalization of credit policy, etc., must be critically analyzed before these are adopted and implemented.
Thus, financial management is closely linked with different functional areas of management. Since financial management is involved in overall planning and control of funds of the entire firm, it is related to each and every segment of operations of the firms. That is why it is generally said that finance department has more important place than others. However, it must be noted that it is only the concerted efforts of all the departments that help achieving the objectives of the organizations.
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