Brent Cross: Business Decision Making - Assignment Example

? Business Decision Making Business Decision Making Task I) Brent Cross is part of North London, at the “London Borough of Barnet”. The area is located close to the “A41 Brent Cross foyer, which crosses the A406 North circular way”. The area is home to the Brent Cross shopping center and a population of not less than 2.5 million. Through the market research, the investigators will determine the market. Through evaluating the need for gym services at the Brent Cross area – the study will determine whether the investment will stand well, with regard to the values of the residents, and whether the business will be able to offset any competition. The market research will contact different members of public – as opposed to consulting target audience. The disadvantage of the model is that it is time consuming (Dillon, Madden and Firtle, 1994). First part: Market Research questionnaire First name……………………Middle name……………………..Last name…………………. Age.........Sex………Occupation…………….Contact details……………..Permanent address……………Email address………………... Evaluation of individuals in need of gym services 1. Height………..Weight………… 2. Please describe your lifestyle Sedentary: working from a stationary point all day………………… Moderate. I participate in exercise occasionally…………………. Active. I exercise regularly……………………… 3. How can you describe your eating patterns or habits? Erratic: I eat whatever I come across…………….. Fairly regular: I skip a number of meals…………….. Regular: I ensure to get all meals and in a timely manner………… 4. Do you eat between main meals? 5. Are your meals low calorie…………..moderate calorie…………..or high calorie………. 6. How can you describe your physical fitness / condition Tend to get tired easily – both mentally and physically Fit and Active Other descriptions…………………………………………….. 7. What exercises do you currently participate in? and for what reason To keep my current fit body or figure…….. To cut excess fat……………… To build an athletic and muscular body……… Second part: To evaluate the demand for gym services 8. Have you used gym and fitness facilities before? 9. Have you taken any gym training sessions? 10. What fitness facilities do you use? 11. What fitness facilities do you own? 12. Where do you access fitness facilities? 13. How long have you participated in fitness services? 14. Use the key below for the questions 15. (Rank yourself as excellent, good, average, poor, very poor) Please rate your physical exercise and fitness participation?................... Please rate your capacity in using Gym facilities?................................... Do you think that gym services are important for every person?................................. (Give reasons) Do you have access to a gym center?.............................. How often do you use the services offered at the gym center?.................................... Which of the two fitness training do you prefer? Gym services…………Aerobics……….. Part three (For those that have used gym services in the past) 16. Did you find joining a gym helpful? 17. Are you satisfied with the gym and fitness facilities received? Where would you expect that the services were different? 18. Have you received any gym and fitness services while at Brent Cross? 19. What was the price for the services? Was the price worth the services given? 20. What was your overall satisfaction and what comments can you draw from that? 21. How did you rate the services received, and what reference points do you use for that? 22. How would you expect the gym services to be offered at Brent Cross? Part four: Description of the general Brent Cross population 1. How would you define the fitness levels of the residents of this area? Generally slim and unhealthy………….. (Explain) Generally fit and healthy………… (Explain) Generally fat and obese (unhealthy)…………………... (Explain) 2. Do you think that there is enough potential for a gym center at this area? 3. What causes would you attribute to the fitness levels described in (part four, question one above? 4. What fitness services would you recommend for the general population of this area? Secondary data sources for the Diamond Gym business problem. The information collected from these sources will be used to support the primary data collected using the questionnaire method for the problem. The information to be collected from the different sources includes resident demographics, records of disease patterns, records of fitness patterns, the number of residents within the region and the records of the fitness and the exercise facilities available at the area. This information will also help give insights into the marketing research problem. The advantages expected from using these secondary sources of marketing information include: the information collection can be completed in a short time and at a lower cost, for instance, the costs of distributing questionnaires will not be borne. These sources offer convenience of access, for example, to the sources that are digitized. The sources for this information include the internal and external sources from hospitals, registry offices (population statistics), social surveys and the registers of other fitness centers, whether within the area or around (Dillon, Madden and Firtle, 1994). II) The sample for the study was selected through a 3-phase design with probability, equal sampling at every stage. The first phase was sample selection based on samples drawn from the different areas, where the area was divided into three different areas: the shopping center area, the area to the west and that south of the shopping center, and lastly the area to the north and that to the east of the shopping center. Phase two was the drawing of the sample from the sampled areas from the study areas. The third stage was the selection of representatives from the different sampled areas, on a probability basis, to represent the entire populations in the respective sample areas. For every 2,500 residents, one informant was picked – on a probability basis – to avoid bias in selection. The sampling frame for the study was the population listing of all the residents dwelling at the pre-determined areas (Brown, 2010). The sampling frame took account of persons and not institutions or homesteads, as these were likely to result in faulty representation of the general population. The survey methodology was split into three phases and three groups from the region to avoid the faults resulting from overlapping samples (Sapsford and Jupp, 2006). III) The disadvantages of using the questionnaire tool to collect the primary data include the following: many informants may forget important details; the questions are standardized, thus there is a high probability that different informants will misinterpret the questions; the limited space provided to answer open-ended questions may limit the informants contributions, and the information recorded may also be very hard to process and analyze. Many of the weighty questions may be answered superficially, which will result in inaccurate findings. The advantages include the following: responses are gathered in a standardized manner, thus the information is more objective than that collected through interviews. The method is quicker to collect information, and the method can feature a large sample, which may be hard to do using methods such as interviews (Sapsford & Jupp, 2006). Task 2 Annual expenditure on Furniture (?) Mid point Households Total expenditure MP-Mean (MP-mean)2 0-125 75 5 375 -675 455625 250-500 375 28 10500 -375 140625 500-750 625 32 20000 -125 15625 750-1000 875 20 17500 125 15625 1000-1250 1125 10 11250 375 140625 1250-1500 1375 5 6875 625 390625 4450 1. I) Based on the table, the arithmetic mean from the descriptive statistics is computed by summing the midpoint amounts, then dividing the total by 6. = (75+375+625+875+1125+1375)/ 6 = 741.67 II) Median 75, 375, 625, 875, 1125, 1375 = 625+875/ 2 = 750 III) Mode = 625 (as it has the highest frequency) IV) Standard deviation =390625+140625+15625+15625+140625+455625 = 1158750 1158750/ 5 – 231750 SD= square root of 231750 = 481.40 2. From the results drawn from calculations 1-4, the average local household spends (?) 741.67 each year. This shows that a majority of the households spend amounts in the range of ?741. This amount is not far from the median amount, showing that a majority of the households surveyed spend amounts comparative to the mean amount. From the data, it is clear that the households within the spending range of 500-750 are the most prevalent, as most of the surveyed household spending falls within that class. This shows that the highest level of spending for households falls under the 500-750 class (Brown, 2010). 3. A quartile represents the mid amount between different quarters within a distribution. The lower quartile shows the value difference between the first and the second quarters of the data distribution. The upper quartile marks the value between the third and the fourth quarter from the data distribution. Middle quarter is referred as the median. Percentiles are values that split the sample into 100 groups of equal numbers. For example, 30% of the data values fall below the 30 percentile mark. The coefficient of variation indicates the dispersion of a set of data as a proportion of the mean of the data. This is the ratio of the SD to the mean and is shown as a percentage (Brown, 2010).   Task 3 1. I) Scatter Diagram showing the Sales volumes and respective profits for years 2000-2011 From the scatter diagram, it is evident that the sales volumes of Jango PLC have been increasing and decreasing alternately from one year to the other. For example, sales increased from 600 – 840 – 420 from 2000 to 2001, then 2002 and the respective profits are 200, 300, and 150. This shows that the business of Jango PLC is seasonal on a yearly basis: sales volumes and realized profits increase after a rise in previous values (Barabba, 1991). Trend line showing the direction of profits between 2000 and 2012 Following the profit levels trend depicted through the trend line on the sales volumes of Jango PLC between 2000 and 2011, it is clear that an increase in profits is succeeded by a decrease in profits in the coming year. Therefore, this clearly shows that the profit levels of 2012 will be lower than those of 2011, which registered an increase from 165-485 from 2010. This is the case as the profit values of the business depict a seasonal yearly profit-making trend (Barabba, 1991). PowerPoint and Excel will be used as the presentation media to the board of directors at the meeting. The writer chooses the two because PowerPoint is easy to use and very powerful presentation software: it is a component of the MS suite. PowerPoint will be useful in creating presentations for the different audiences and the various presentation needs (Barabba, 1991). 2. Formal business report to the CEO October 24, 2012 The CEO Jango PLC Dear Sir, The above report was drawn as requested on October 2, 2012, showing the findings drawn from the sales and profit-making trends of Jango PLC. The report offers an evaluation of current and future causes of sales and profit declines for the company. The findings depicted that the sales volumes of the company alternate from one year to another by increasing and decreasing, which results from the seasonal nature of the company’s business and which fluctuates or increases after one year. The reason for the constant decline can also be attributed to the reinvestment of profits in the purchase of company assets, which is not reflected in the sales or the profit levels of the company. The company has been purchasing new assets after every high-sales season, which could result in the reduction of sales in the next year, as personnel are still under training on using these machines and facilities, and the training expenses and the time spent also impact the sales and the profit levels of the company. I look forward to a discussion over the recommendations of this report with you and will be grateful to explain to the employees, methods that could be used to reduce the alternating trend. Sales Manager, Jango PLC. Task 4 (I) The business organizations need to capture information for the following purposes: planning, controlling, performance measurement, recording transactions and decision making. In order to realize these areas, quality information is required. There are different types of information: strategic, operational and tactical information. In an MIS (Management Information System) the deployment of new IT forms part of operational decisions, which fall under operational information used to ensure that enumerated tasks are run effectively at the company. This involves all managers as the function is highly quantitative and tasking. The system that can aid decision-making at the different levels could be an MIS, which incorporates technology, people and information to offer information on managing the construction process effectively. For instance, the MIS could be programmed to offer reminders about the steps succeeded or preceded by an earlier construction phase. For example, upon the completion of Stage F, the MIS will offer reminders for checking the states of A, B, C, D, and E (House, 1983). II). Network diagram highlighting the activities that are critical to the project Discuss the III) The earliest start time being November 1st, Phase A (Jan 19, 2013) (BCD and E) start on Jan 20, 2013 and are completed on March 31st 2013. This will be preceded by (F, G, H, and J) completed on June 24, 2013, which are preceded by (K and L), which will be completed in July on 19, 2012. The earliest finish time is June 24, 2013 (Arnold, 2007). IV) The minimum duration for the project is eight months. B) I) Accounting rate of return = average profits/Average investment X 100% = Gym option (80,000+ 100,000+ 110,000 + 140,000 + 150,000) = 580,000 Golf option (90,000 + 110,000+ 150,000+ 110,000+ 50,000) = 540,000 Option 1 (Gym option) Years Cash flow 10% Factor Present value of cash flows 5-Jan 580,000 580,000 Now 500,000 3.79 500,000 80,000 Accounting rate of return = average profits/Average investment X 100% = 80,000/500,000 X 100% = 16% Option 2 (Golf club option) Years Cash flow 10% Factor Present value of cash flows 5-Jan 540,000 540,000 Now 500,000 3.79 500,000 40,000 40,000/500,000 X 100% = 8% II). Payback period = cost of project/ Annual cash inflow III) Net present value for Gym option is -80,000 And Golf club option is -40,000 Following the immediate nature of adopting the golf club option and the less financial burden resulting from it, as compared to taking the project of constructing the gym, the management should take the option of the Golf Club, as it will be cheaper and can be accomplished faster (Arnold, 2007). References Arnold, G., 2007. Essentials of corporate financial management. London: Pearson Education, Ltd. Barabba, V.P., 1991. Through a glass less darkly. Journal of the American Statistical Association, 86 (413), pp. 1–8. Brown, S., 2010. Where the wild brands are: some thoughts on anthropomorphic marketing. The Marketing Review, 10 (3), pp. 203–224. Dillon, W., Madden, T. and Firtle, N., 1994. Marketing research in a research environment. London: Irwin. House, W., 1983. Decision support systems – a data-based, model-oriented user developed discipline. New York, NY: Petrocelli Books. Sapsford, R. and Jupp, V., 2006. Data collection and analysis. London: Sage Publishers. Read More