Goals of Market Research3
Industry Demand Analysis4
Market Share Projections6
Larry Brownlow is investigating the feasibility of owning and operating a Coors distributorship in the Kent and Sussex counties of Delaware. It was necessary to outsource his research to Manson and Associates. The first decision to be made was which primary and secondary data was valuable to his research. With the acquired data, his second objective was to decide if the target market could support another beer distributor.
After analyzing the data, Larry found that there was a significant consumer and retailer interest in the Coors’ product. Larry projects the market share to be higher in Southern Delaware than Coors’ average of 8.8%. The beer taxes paid by wholesalers in the target market area has increased 6.3%. This directly relates to the expansion of the market, an increase in gallons sold.
Based on South Delaware Coors, Inc. optimistic and pessimistic proforma income statements, this is a viable and profitable business opportunity.
South Delaware Coors, Inc. is the entrepreneurial brainchild of Larry Brownlow, an expectant graduate of a MBA program. Brownlow has always believed “the best opportunities and rewards come from smaller self-owned businesses” such as the Coors distributorship. Larry has $500,000 from a family trust and wants to invest the money in a good business that will provide for his family as well as remove him from the day-to- day torture of a corporate giant. Coors Inc. has found there is a need for a distributor in the Kent and Sussex county areas of Delaware. The company has decided to open the business opportunity to everybody through an application process. After all applicants are reviewed, Coors will select its new business associate. Due to time constraints, Larry has hired Manson and Associates, to prepare a research proposal. He will use this information to determine the feasibility of a Coors distributorship in the two county regions of South Delaware.
South Delaware Coors, Inc.’s mission is to become the number one Coors beer distributor in South Delaware capturing a market share of 12% or more within the first three years while continuing the tradition and values of its parent company.
Goals of Market Research
Larry realizes the need for good primary and secondary market research. Primary research is data that has been collected for a specific business problem. Secondary research is data that is collected for another purpose but can be helpful in other areas. Larry knows it is important to have some good secondary research data as a benchmark to compare to the more specific primary research data. After meeting with Manson and Associates, Larry was presented with nine different research studies at a cost of $18549.50. He could not afford all of the proposed studies with his limited budget of $15,000, so he reviewed each one to determine if they would be helpful. In the end, Larry purchased the following studies for the price of $13,000.
Table CEstimates of Coors' Market Share for 1990-1995, $2,000 Table EBeer Taxes Paid by Wholesalers in the Market Area, 1988 and 1989, $200
Table GConsumer Study, $6,000
Table HRetailer Study, $4,800
The first step...