Business Opportunities in the Leisure Goods and Activities Industry - Coursework Example

? Business Opportunities in the Leisure Goods and Activities Industry and Section # of INTRODUCTION The leisure goods and activities industry is the industry with the most potential to expand. No matter what the economists say and what the politicians prove, this industry has been on its boom ever since the technology improved. Leisure goods and activities include: sporting arenas, amusement parks, theatres, hotels, tourism industry, venues for musical groups or lectures and gaming place. One can also add spas, gyms or the places where the sporting activities can be held such as golf clubs or boating to the industry. Even in the leisure industry, there are two types of recreation: firstly, when an individual participates in a physical activity such as playing football, cricket, hockey, tennis, squash, playing some music through piano, flute etc., doing some sort of gardening or acting. The other type of recreation is where the individual is not physically involved. Rather, it is the mental activity such as watching television, playing games on computer, listening to music, attending concerts, or going to a restaurant. The first type of recreation is very rewarding and motivating. On the other hand, the latter makes people feel good and relaxed. Huge amounts of income are being spent on activities such as eating, drinking, and watching movies in cinema. FACTORS AFFECTING LEISURE INDUSTRY Leisure goods and activities industry is no doubt expanding but, these sectors are greatly influences by the recessionary pressures. The most common factor that affects this sector is the disposable income. Although, everyone pays attention to this sector but the expenditure is highest in those regions where consumers have plenty of time and money. For example, the UK boating industry acts as an area of strength for the UK manufacturing sector. The leisure boating sector is becoming around ?2 billion turnover industry. The industry which makes the greatest turnover and also generates job opportunities is the strength of a country. The growth of this industry has also increased the tourism activity in UK. Tourism activity is interrelated with other businesses, government and also the local residents. Tourism industry attracts a lot of labor and generates high income. Therefore, spending in the tourism industry benefits the economy on the whole. It also buys goods and services from others businesses and pays out salaries to the employees. This further buying of goods and services is known as the secondary sales and creates a secondary economic effect. It creates additional income and job opportunities in those sectors which provide to the tourism industry. The tourism industry would generate business for the beverage industry, the snack industry, construction industry and the government also. In UK, the imports of sporting goods, musical instruments and toys were ?6.6 billion in 2005 where as the exports were ?803 million. TRENDS IN LEISURE INDUSTRY Sports goods form a large proportion of the leisure goods industry. Sports are a major part of the entertainment culture. It is not linked to one industry, rather, a range of different industries are involved. Throughout the world, sports form a major part of the sales and purchases of a country. Taking an example of New Zealand, the gross output of sports sector increased by 2.5% per annum from 1996 to 1999, and it became the largest contributor of the sports clothing manufacturer. Real value added was up by 0.4% p.a. of the physical leisure industry. Nominal household expenditure increased by 16.6% p.a. over the period of 1996-1999 in the coaching services and clubs sector (Goodchild et al. 2000). There is an increasing trend of leisure and entertainment as the technology has improved. Even though the leisure goods industry has been increasing but in 2011, the toys industry of the U.S. market has declined. The major manufacturers of the toys are the Chinese industry where inflation has hit very strongly. This inflation has caused the cost to rise very rapidly in the American market which they cannot pass on to the consumer. Due to the increase in prices and less demand from the consumers, the shipments and orders are cancelled and toy purchase has reduced. This decrease in demand resulted in the reduced toy space offered by the retailers and major stores which in turn, ate up the manufacturers’ sales. The major reason for the decrease in the demand of stuffed toys is the online availability of the games and toys with special effects. The Bratz is a very good example of this. They are the ideal dolls with attractive figure and hair. These dolls also represent the latest fashion and provide opportunities to the users to dress them and design them according to their wishes and put makeup on them. This game makes the user involve their full imagination and give a personal touch to decide how they want their doll to appear. There is no time limit and no objection of any kind, giving free hand to the youngsters to express their imagination and play. Bratz fashion designer is an online game with no cost and no in security of getting hurt or spoiled. The technological evolution is a major cause of the decline of certain industries but also the cause of the boom of certain sectors. They toys sector is on decline due to the growing inflation and the advent of online games. SCOPE OF LEISURE INDUSTRY Leisure is also home based and involve one time purchases of certain goods like radios, videos, computers, games, TV sets, Hi-Fi sets and books. These are not costly as one time purchase is made and the user gets benefit for a long period of time. With evolving technology, the demand of newer and better items drives the older one out of the market. Therefore, to remain in the market, constant research is required for the manufacturers. Technological development has reduced the need of man power and increased the time available for leisure. The change in culture is a major factor along with the increase in personal transport of the boom in the leisure industry. The amusement parks and resorts such as Disneyland Resort or typical resort like Sandals. They work earn money by fulfilling the needs of a person on vacation. The Disneyland resort not only has rides but it also have shopping jaunts, dining options and attractive packages to visit other parks for further enjoyment. More options and verities are offered to in order to generate more money. In addition to this satisfying the needs of guests of all age is important. Leisure goods and activities sector includes a wide range of goods and services. There are many business opportunities in the sports goods industry as the media has induced the craze for sports. The tourism industry requires the government to take action and provide all the opportunities to develop and if provided the right way, it has the maximum chances of generating revenues. The natural beauty of the places if developed to attract the tourists provided that all the chances are given to the people to be entertained and be satisfied, would result in becoming the largest income generating source. Musical instruments, games and call phone industry have chances of business development whereas; the toy industry is on decline. The best industry to target is the tourism industry and the restaurant industry. The trend of dining out has increased as the culture of society has changed. People want to spend more time with each other and enjoy and so, they prefer going to hotels and clubs. The best service provider restaurant captures the maximum customer. Sometimes, income is an issue but mostly, the consumer looks for the best services rather than the cost. The consumer now a days Is willing to pay more to get better services and benefits. All the service industries have this opportunity to expand their businesses. CONCLUSION In order to target the right market and to capture the maximum benefit out of the industry, the manufacturer or service provider needs to keep in view 7M’s which include management, maintenance, multiculturalism, motivation, money, model, and marketing. Looking for business opportunities in the industry, the managers need to have through research and calculations on these 7M’s. Provision, transport and location are the basic factors that determine access to a product or service. Government plays an important role in the development of the leisure goods and activities industry. Increasingly affordable air travel also helps in attracting more consumers from across the world. The manufacturers and service providers of this industry need to monitor the cost, the demand of the consumer, the trend of the market, the technological developments and the culture of the society to benefit from their products and services. For example, if there is no culture of going to clubs in a particular area, then opening a restaurant would never be beneficial. Therefore, the maximum benefit can be acquired when the 7M’s are applied skillfully. There are always business opportunities in the leisure goods and activities industry but it is important to target the right market and to look for the right model to be used. All across the world, this industry is on its boom but one can never forget the technological development and the increase in labor cost which makes certain opportunities a miss. Proper market analysis as well as the demand analysis helps to identify the point of development and the opportunity available in the sector. BIBLIOGRAPHY Mark Goodchild, Frances Harris, Ganesh Nana and Sarah Russell (2000). The Growing Business of Sport and Leisure: The Impact of the Physical Leisure Industry in New Zealand. Available at http://www.sparc.org.nz/Documents/faq/The_Growing_Business_of_Sport_and_Leisure.pdf Read More