Porters 5 Forces

Topics: Decision making, Decision theory, Decision engineering Pages: 8 (3282 words) Published: April 23, 2013
Sonia’s smoothies

1) Nick calculated that of 200 customers who completed the questionnaire at the rock festival, the mean age was 23. The age distribution conformed to a curve of normal distribution with a standard deviation of 5. Calculate the number of customers aged 33 and over who featured in Sonia’s survey

(33-23)÷5 = 2
2% of 200= 4

Answer= 4

2) With reference to the report on the UK smoothie market (appendix 2) analyse two limitations of using secondary sources as the basis of Sonia's decision making.

Secondary research is one that is carried by a third party and not yourself. The information is collected as it may serve propose in the information you need even though it may have been collected for a different research. There are however some limitations of Sonia using this secondary research whilst making a decision on what smoothie flavours to bring out. In this essay I will discuss these and give my opinion on whether Sonia should or shouldn’t solely base the decision on this information. The first limitation of using secondary research is that it may be several years old and may not reflect the current market conditions. If this is the case for Sonia then it would mean that she may be releasing a flavour into a market that no longer exists. This would mean that her sales will not be as high as she would of hoped, it would also mean that her costs will rise as she would be producing smoothies unaware that these are not going to sell. The impact of both of these things happening will result in Sonia losing profit. This one example shows that for Sonia to solely base her decision on secondary research it would not be good for her business as she could lose out on a lot of potential customers. The second limitation of using secondary research is that it may not be accurate and reliable as it may be biased. If this does happen then it would mean that Sonia would be making a decision on information that is not 100% accurate and true. This would be misleading for her as she would be making a decision based upon something which is not going to benefit her at all. This would result in her again losing profits as her costing will rise through producing the goods and sales being low. This again shows us that if Sonia does make a decision solely based on the secondary research it may result in failure of the product she releases. In conclusion I think that Sonia should use secondary research as it gives her a basic idea about what is happening or has happened in the market which will give her a slight idea but it should be used in conjunction with some primary research such as questionnaires so Sonia 100% accurate data and knowledge. If this is done then it would ensure that the decision being made will be the correct one resulting in the success of the product she releases.

3) Discuss why nick might have recommended that Sonia should not base any decisions on the rock festival research.

The rock festival research is a type of primary research. Primary research is one that is collected by yourself. In this essay I am going to discuss the reasons why Nick may have recommended Sonia do not make decisions solely based on the rock festival research, I will then come to a conclusion as to what Sonia should do to ensure the decision being made is the right one. Firstly by carrying out the rock festival research it means only targeting one group of people, therefore other groups such as families and children would be missed out. The consequence of Sonia making her decisions on just the rock festival research could be misleading as she has not taken into consideration groups that may be her major customers. For example families may be her major target audience and if Sonia makes a decision based on a group other than the families she could release a non desirable flavour. If this does happen then it would mean that she could be releasing a flavour that is not in demand which would result in less...
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