Table of Contents
The recent economic downturn has resulted to severe consequences to the operation of various businesses. Many businesses have either collapsed or reduced their operations due to the effects of the economic downturn. This has reduced the demand of different products in the market hence affected the level of trade. The furniture industry has also been severely affected by the economic downturn as many businesses have closed their operation hence reduced the demand for office furniture. The reduction in the demand of office furniture in the industry has reduced the profitability of companies involved in selling of office furniture. It is therefore advisable for companies involved in the production of office furniture to consider diversification programs so as to enhance their chances of survival in the market.
The most appropriate diversification program for firms involved in selling office furniture is to invest in home furniture market. This report gives detail diversification program that can help Facelift Ltd. to survive from the effects of economic downturn. Since the company core business of selling office furniture has been affected by the economic downturn, it is prudent for the company to diversify into other businesses that will enhance its revenues hence ensure that it remains productive and profitable. The report provides a diversification program that involves selling home furniture by the company in the UK market. In the report, various methods are proposed for gathering market information as well as the justification of using the proposed methods of data collection. The report also develops an appropriate questionnaire that can be used by Facelift Ltd in the market research.
Entering a new market requires organization to conduct appropriate market research so as to be able to determine market conditions such as the taste and preference of customers, market availability, pricing strategy to be used and competitors. The identification of the market factors are important in the development of a marketing strategy that accompany should adopt in the new market so as to become competitive. Various methods can be used to collect data during the market research. Facelift Ltd. can use a variety of data collection methods in its market research to ensure that the data collected is accurate and reliable. The data collection plan will involve both the use of primary and secondary data collection method.
The primary data collection method is a methodology that involves the collection of data from original sources. Many methods can be used to collect data from primary sources. For Facelift Ltd, the primary data collection methods that should be used include observations and surveys. Observation and surveys as the primary data collection method will ensure that the data collected is from the original sources hence increases the reliability and validity of the research.
Observation involves the collection of data from the primary sources through observing individuals, their actions and situations. This data collection method is one of the easiest and cheapest method hence it will enable the company to incur low cost in the market research. Facelift Ltd can use observation to collect data from various sources such as customers, suppliers and the market. During observation, various activities should be monitored in the UK home furniture market such as the rate at which home furniture is being traded at the market, the design of the home furniture that the manufacturers are making, the prices charged, raw materials used, location of the stores and the taste and preference of customers. The information obtained from observation can be used by the company to plan and design its products, the production output, determine the prices of the home furniture and the location of its stores. Observation can also be made directly from various homes and home furniture stores and markets.
Survey is also another important data collection method that Facelift Ltd. Should adopts in its marketing research. Surveys will enable the company to obtain descriptive information that is needed by Facelift Ltd in its market intelligence. Survey method of data collection is accomplished through asking of specific questions to identified groups in the market. This can include asking questions to consumers, suppliers and various distributors. Facelift Ltd can use survey to obtain information from various homeowners and retailers of home furniture in the UK market. The company can administer survey in two forms that include the use of survey questionnaires and interviews. The questionnaires can be effective in collecting information from various home owners in UK. The company can select a sample of homestead and distributes the questionnaires to them. The selected homestead should reflect the entire population of the country by considering various locations and ethnic groups within the country. This will make the response received to be accurate and reliable in reflecting the home furniture market in the country.
Secondary data collection involves the collection of data by individuals other than the user. Secondary data can be obtained from various publications such as books, journals newspapers and organizational records. Facelift Ltd. can use various secondary sources of data to obtain information regarding the home furniture market. Among the secondary sources of data that Facelift Ltd should use include various publication of home furniture industry, publication on market information, economic publication and real estate publication.
Publication from the home furniture industry can be used to analyze the home furniture market and trends. This can help the company to determine the products that best satisfy the customer’s needs, the prevailing market prices and the factors that affects the industry. Publication of the home furniture market information can be used to analyze various factors that affect the industry so as to enable the company to develop appropriate strategies that can enhance its performance. Economic publication can also be used to analyze factors such as the demand for home furniture, opportunities, threats and the purchasing power of customers. Real estate publications can be used to determine the current trend in home furniture used by majority of the homeowners. It can provide useful insight on the types of furniture that is preferred by majority of home owners hence enable the company to develop appropriate home furniture that will meet the demand and needs of the customers.
The survey methodology involves the process of collecting and analyzing data during the market research. The survey methodology for Facelift Ltd. should be conducted in steps. The first step in the survey methodology will involve sampling where different participants of the study will be determined. The collection of participants for the study will consider various aspects such income group of the participants, age, occupation and sex. This is to ensure that different aspects of the population are reflected in the study. Regional balance will also be considered when selected the study sample to ensure that cultural differences are reflected in the sample.
After the identification of the sample for the study, survey questionnaires will be distributed to the respective participants. The questionnaire will be composed of simple question that can be understood by different people from various backgrounds. This will ensure that the responses received are accurate. In case where the geographical distance is large, the questionnaires will be emailed to the participants. Interviews will also be conducted to some selected participants in the study. This will help in the provision of more insight regarding the market of home furniture in UK. The interview sessions will be recorded for analysis purposes.
After the collection of the data from various participants, a comprehensive data analysis will be conducted using both qualitative and quantitative research method. The use of quantitative and qualitative research methods is to enable the findings of the market research to be accurate and reliable. The results of the findings will then be presented to the company as well as recommendation regarding the diversification program.
The question included in the question should be able to attract responses that are detailed in the provision of market information. It should enable the company to come up with appropriate marketing strategy that will enable it to gain competitive advantage in the market. The following are the proposed questions for the survey questionnaire.
- Please specify your gender (Male, Female)
- Please identify your age group (18-29, 30-45, 45-60, 60 and above)
- Please specify your occupation——————-
- Dou you own a home or rent a house( Own home, Rent House)
- What type of furniture do you have in your home or house ———————–
- How often do you buy home furniture———————————
- What features do you consider when buying home furniture
- What are the features that you are currently lacking in your home furniture and would like to be incorporated in the future design—————–
- What is your most important home furniture—————–
- Is there any improvement that you would like to be include in your furniture (Yes, NO)
- If yes what are the improvements————————————-
- What are the challenges that you face in purchasing the furniture—————————–
- What is your favourite company that manufactures best home furniture———————
Facelift Ltd can use a number of techniques to make useful conclusion regarding the market research conducted. Some of the techniques that the company can use to make conclusion and major decision include the use of quartiles, percentiles and correlation coefficient.
Quartile is an important tool for analyzing data obtained in a market research. The analysis of data using quartile can involve division of the observation into four intervals that are based on the values obtained from the research. Each quartiles set is composed of the 25 percent of the observation. The arrangement of the data should be in ascending order starting from the smallest to the largest. The first quartile falls below 25 percent of all the data collected, second quartile falls between 25.1 percent and 50 percent of the observation made and the third quartiles falls between 50.1 and 75 percent while the fourth quartiles falls between 75.1 percent and 100 percent of the observation made. The appropriate conclusion can be drawn based on the second quartile which normally reflects the median. This can provide the best estimates of the observations. For example, Facelift can apply the use of quartiles to make decision on the appropriate price of its home furniture products.
Percentiles are values that divide a given data set into one hundred equal parts. Each part of the data set is therefore represented by 1 percent of the total data set. Facelift Ltd can use the concept of percentile to analyze its data set and draw appropriate conclusions based on the highest or lowest percentage. For example, when making decision regarding the type of home furniture to manufacture it can consider the home furniture which is selected by high percentage of the study sample. Hence the decision making regarding the products to be manufactured by the company should be made based on the observation with the highest percentage.
Correlation coefficient measures the degrees to which two or more variables are related. This measure can be applied by the Facelift Ltd to determine the relationship between various factors in the market. For example, the company can use correlation coefficient to determine the relationship between price and number of competitors. The correlation coefficient can either be negative or positive. The company can draw various conclusions depending on the correlation coefficient of being either negative or positive.
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