Analysis of Samsung UK - Essay Example

Contents Task 3 Task 2……………………………………………………………………………6 Task 3……………………………………………………………………………8 Task 4……………………………………………………………………………10 Task 5……………………………………………………………………………12 Task 6……………………………………………………………………………12 References…………………………………………………………………….15 1.0 Task 1 Samsung UK is an electronic company based in the United Kingdom. Samsung is a leading manufacturer of electronics ranging from home appliances, television sets to mobile phones. The company has authorized suppliers across the United Kingdom. The management is considering opportunities in the tablet market. The new product targets tablet users in United Kingdom. In order to achieve this goal, the company plans to conduct market research for a successful launch of the product in the UK market. The study will be carried out in the South East market. The research plan will discuss the details of research. The management focuses on the application of various research methods. Research companies shall interview tablet users in the South East market. The researcher will also use both structured and unstructured interviews to obtain information on the product. Interviews will provide both qualitative and quantitative methods. The researcher should minimize chances of nonrespondence by approaching the subjects appropriately. Flexibility will be integrated in the interview process in order to maximize information obtained (McKee, 2014, 1). Similarly, researchers will use questionnaires. Mailed questionnaires will be randomly sent to tablet users on a random basis. The researcher should consider the cost of sending feedback from the respondents (Elvis, 2010, 56). Prepaid stamps should be used to cushion the respondents on the mailing costs. Moreover, the researcher may obtain primary data on the market trends. A market analysis will provide quantitative and qualitative data. Researchers can request electronics’ suppliers to furnish them with sales records on tablets. Alternatively, researchers can use secondary data from electronic databases. Sales records will provide detailed information on consumer demand of tablets. Data on consumer preferences will be obtained. The company encourages researchers to apply any other research methods provided they avail adequate data. The objective of the proposed research is to obtain as much data from customers as possible. Particularly, qualitative data providing information on consumer taste and preference is of great importance. The researcher should obtain data on the prevailing market price of the various tablets available in the market. The information obtained will enable the management come up with a price that will maximize revenue for the company. Consumer demand pattern should also be obtained as it will help the company predict expected demand with a high degree of certainty. The researcher should conduct a survey instead of a census of the population. The sample chosen should be representative of all tablet users. It should provide information that portrays the situation on the ground. Probability method of sampling can be used. This method of sampling will reduce chances of utilizing a non-representative sample. Sampling will provide sufficient information within a reasonable amount of time. Additionally, this methodology will save on costs and minimizes probability of errors due to the small size of the sample (Government, 2014, 1). Interviews conducted will provide primary data. Questionnaires will also be applied to collect information from the customers. Secondary data, on the other hand, will be obtained from consumer databases. Additionally, researchers will obtain secondary data by assessing sales records from suppliers of tablets. Researchers can access electronic consumer databases through the internet and collect detailed information regarding prices and consumer demand of tablets. The researchers will perform statistical procedures on quantitative data (Rabinowitz, 2014, 1). They will use statistical operations to calculate the mean, frequency, standard deviation, mode, and the median. These statistical procedures will be used on both primary and secondary data. Time ought to be considered by the researchers. The research process will last two months. The first month will be used to obtain quantitative and qualitative data from tablet consumers. One month will provide sufficient time for consumers to answer questionnaires and send them back to the researching company. The researcher will have one month to analyze data and come up with various relationship between price and quantity demanded. Additionally, the time will be sufficient to present the data collected and submit it to the marketing department of Samsung UK. Researchers must ensure that the study is conducted efficiently within the budget allocated. The following is a sample questionnaire to be presented to the board. QUESTIONNAIRE FOR CUSTOMERS Questionnaire Number: ………………. Date: ………………………………. Dear Respondent, We are a research company based in South Eastern region of the United Kingdom. Our client is a leading electronics manufacturer. The information contained here is confidential and based solely on commercial purposes. Respondents are thus kindly requested to complete and give any additional information they deem necessary. (Please tick once and fill where necessary) 1) Tablet purchased ……………………………………………………………. 2) What are the features of the tablet bought…………………………….. 3) What is the price paid for the purchased? ……………………………… 4) Based on your experience what are the key advantages of using that brand of tablet? 5) Are there any aspects of the tablet you think should be improved? If any specify the feature 2.0 Task 2 Amount spent Midpoint, Xi Number of orders (Frequency, F) Cumulative frequency FX (Xi-Mean)2 Mean= 50.80 0-10 5 5 5 75 2097.64 10-20 15 7 12 105 1281.64 20-30 25 10 22 250 665.64 30-40 35 12 34 420 249.64 40-50 45 14 48 630 33.64 50-60 55 15 63 825 17.64 60-70 65 14 77 910 201.64 70-80 75 13 90 975 585.64 80-90 85 6 96 510 1169.64 90-100 95 4 100 380 1953.64 N=100 ∑FX=5080 ∑=8301.4 i) Mean= FX÷n= 5080÷100=50.80 The mode is the amount spent that has the highest frequency (Math, 2013, 1). The highest frequency is 15 and is associated with an expenditure of 55. 55 is the mode. The median is the figure that occurs in the midpoint (Math, 2013, 1).The cumulative frequency is 100; hence the midpoint is 50. Median = 45+2/15× 55= 52.33 According to the figures, obtained the best price range is 50-60 because it has the highest frequency and thus can generate the highest revenue for the business. ii) Standard deviation is obtained by calculating the square root of variance (Fun, 2010, 1) The variance is the average of the squared differences of the mean and the midpoints. Variance = (Xi-Mean)2 = 8301.4 =83.014 N 100 Standard deviation = √83.014 = 9.1112 Range is obtained by getting the difference between the lowest and highest value (BBC, 2014, 1). Therefore, Range = 95-5= 90 iii) Lower quartile or 25th percentile = 25% of Cumulative frequency(N) = 25% × 100= 25 The value that has a cumulative frequency of 25 is the lower quartile. Therefore, Lower quartile = 25+ 3/12× 35 = 33.75 75th percentile =75%× 100= 75 The value that has a cumulative frequency of 75 is the upper quartile. Therefore, Upper quartile= 55+ 12/14× 65= 67.75 iv) The interquartile range is the difference between the upper and lower quartiles (How, 2012, 1). Therefore, Difference between upper and lower quartiles = 75-25= 50 interquartile range= 45+2/15× 55= 52.33 3.0 Task 3 i) A sales, costs and profit bar graph is shown below. ii) Sales and profit line graph showing the trend is shown below. Profit is dependent on the value of sales. Therefore, sales are the independent variable while profit is the dependent variable. Sales=x while profit =y The general equation is y=a+bx. Using a scientific calculator a= -88.6043 and b= 0.7251. The regression equation is; y=-88.6043+ 0.7251x The projected sales and profit for the next five years is shown in the table below; Year Sales ‘000’ Profit 2011 320 143.43 2012 340 157.93 2013 350 165.18 2015 365 176.06 2016 374 182.58 4.0 Task 4 Formal business report Forecasting is a tool used by the management to reduce uncertainty in future operations. Forecasting uses present and past data and also trend analysis. The outcome of the forecasting process is future values. For instance, using historical and present information on sales, the management can predict future sales (Dictionary, 2008, 1). Forecasting provides future estimates that help the organization plan for the future. Predicting helps the business satisfy its customers by providing a forecast of future demand. It helps the company use its experience to improve its operations and plan for the future. Regular forecasting helps companies stay focused on the future. It helps the company predict future output and effectively plan for future resource requirements which reduce future costs. Additionally, forecasting provides a rough estimate on inventory levels that in turn reduces inventory costs. Forecasting helps companies cope with competition and stay competitive in the long run (Scheid, 2011, 1). Lastly, future estimates obtained by forecasting are used to apply for funding from lending institutions. There exists a relationship between sales, costs, and profits. A direct association exists between sales and costs. The increase in output is accompanied by an increase in variable costs. Therefore, a positive relationship between costs and sales exists. Profits are non-decreasing in prices and non-increasing in costs (Peterson, 2013, 32). This means that an increase in prices that certainly increases sales positively relates to profits. On the other hand, an increase in costs leads to a drop in profits. 5.0 Task 5 The project duration is 81 days The critical path of the project is the route that uses the shortest time to complete the project. A-B-I-K-L is the critical path of the project. 6.0 Task 6 i) NPV is the difference between present value of cash inflow and present value of cash outflow (Eliud, 2008, 150) Project Alpha Present value of cash inflow (PVCIF)= [35000×(1+0.10)-1]+[80000×(1+0.10)-2] +[90000× (1+0.10)-3]+[75000×(1+0.10)-4]+[20000×(1+0.10)-5] = 229196.652 Present value of cash outflow (PVCOF)=200000 NPV= PVCIF-PVCOF NPV= 229196.652-200000= 29196.652 Project Beta PVCIF= [218000×(1+0.10)-1]+ [10000×(1+0.10)-2]+[10000×(1+0.10)-3]+[4000×(1+0.10)-4] +[3000×(1+0.10)-5]= 218554.247 PVCOF= 200000 NPV= 218554.247-200000= 18554.247 IRR Project Alpha Using try and error method, take the rates 14% and 16% Assuming a cost of capital of 14%; NPV14 =204815.7988-200000= 4815.7988 Assuming a cost of capital of 16%; NPV16= 198228.7292-200000=-1771.27 IRR-14 = 16-IRR 4815.7988 1771.27 1771.27 IRRR-24797.78= 77052.78-4815.7988 IRR 6587.0688R= 101850.56 IRR=15.46% Project Beta Using 14% and 20% NPV14= 209598.8877-200000=9598.89 NPV20 = 197532.7932- 200000= -2467.21 IRR-14 = 20-IRR 9598.89 2467.21 191977.8-9598.89 IRR= 2467.21 IRR-34540.94 12066.1 IRR= 226518.74 IRR= 18.77% ii) According to NPV analysis, the board should invest in project Alpha because it has a higher NPV. On the other hand, IRR suggests that the management should invest in project Beta because it has a higher internal rate of return. Reference BBC., 2014. Averages and Range. [Online] Available at: http://www.bbc.co.uk/skillswise/factsheet/ma38aver-l1-f-range [Accessed 14 December 2014] Dictionary, B., 2008.Forecasting. [Online] Available at: http://www.businessdictionary.com/definition/forecasting.html [Accessed 14 December 2014] Eliud, W. G., 2008. Financial Management. Nairobi: Longhorn Publishers. Elvis, S. T., 2010. Research Methods. Nairobi: Kenyatta University. Fun, Math., 2010. Standard Deviation and Variance. [Online] Available at: http://www.mathsisfun.com/data/standard-deviation.html [Accessed 14 December 2014] Government, Q., 2014. Survey Methods. [Online] Available at: http://www.qgso.qld.gov.au/about-statistics/survey-methods/ [Accessed 14 December 2014] How, S., 2012. Interquartile Range in Statistics. [Online] Available at: http://www.statisticshowto.com/interquartile-range/ [Accessed 14 December 2014] Math, P., 2013. Mean, Median, Mode, and Range. [Online] Available at: http://www.purplemath.com/modules/meanmode.htm [Accessed 14 December 2014] McKee, S., 2014. How to develop a Market Research Plan.[Online] Available at: http://www.surveygizmo.com/survey-blog/how-to-develop-a-market-research-plan/ [Accessed 14 December 2014] Peterson, F. D., 2013. Microeconomics theory. Texas: Longman Publishers. Rabinowitz, P ., 2014. Collecting and Analyzing Data. [Online] Available at: http://ctb.ku.edu/en/table-of-contents/evaluate/evaluate-community-interventions/collect-analyze-data/main [Accessed 14 December 2014] Scheid, J., 2011. 10 Advantages of Business forecasting. [Online] Available at: http://www.brighthub.com/office/entrepreneurs/articles/109618.aspx [Accessed 14 December 2014] Read More