Mba 510

Running head: MANAGING RESEARCH DESIGN

Research and Decision Making

MBA 510 Ð'- Managerial Decision Making

Research and Decision Making

Coffee has two markets: the cash market and the futures market. The cash market is the market today, how much one pays for coffee today and receive it today. The futures market is used to help determine the price for future deliveries. CoffeeTime is a chain of coffee bars that is popular in North America and Europe (University Of Phoenix, 2007). It procures and roasts some of the world's finest coffee beans and sells a variety of blended coffee beverages and snacks. Recent trends in global coffee business indicate that South Asia is an emerging market for coffees with a "special flavor" and coffee bars. The management team of CoffeeTime has decided to research the possibility of entering this market and three pivotal questions must be answered. Which city or cities should CoffeeTime enter? Who is the target segment? What is the expected revenue per outlet? Answering these questions will require both primary/experimental and secondary research prior to entering this new market.

Industry analyst suggested as early as 2003 that Asian markets like "Japan, traditionally a tea-consuming nation and home of the green tea that is fast proliferating in tea markets across the West, might not naturally be considered a coffee-loving nation. But coffee is not only more popular in both volume and value terms, overall tea sales are continuing to lose ground to coffee" Starbucks has played a key role in shaping coffee demand through both on-trade and indirectly off-trade channels also. The company's new coffee concept and espresso culture has been effectively capturing Japanese consumers' imagination since the late 1990s: Japan is the company's first and best performing overseas market outside North America (Lee, 2003)."

Surely, if an industry leader, like Starbucks, has entered this market there definitely exists a demand for the product. CoffeeTime will have to determine the demand is sufficient for their business to thrive as well. This paper will provide support for whether or not CoffeeTime should enter this market now.

In trying to determine where to locate its outlets in India, CoffeeTime had to analyze considerable data. Given this data, what does CoffeeTime know about the various locations in India? Total Access Research provided CoffeeTime with an initial perspective on the population of the consuming class in each identified city. The secondary research performed was based on information assembled from studies previously performed by government agencies such as the Census Bureau, chamber of commerce, or other organizations. The provided data was classified into four information areas which are demographics, leisure and lifestyles, infrastructure and competition. With this information CoffeeTime gains detail knowledge of the consumer's class density, lifestyles, leisure spending patterns, and spending power. The provided data also represents the distribution of population in these cities by age, income groups, and demographics. With the information provided CoffeeTime has a greater knowledge of the potential consuming class.

What doesn't CoffeeTime know that it might learn from further research? The data collected so far is useful information however, it may not be accurate. For example, the secondary research may have provided CoffeeTime with how much consumer paid for coffee last year but not how much consumer are willing to pay for coffee that CoffeeTime produces. Total Access research doesn't provide data on the consumer demands, industry trends, market growth and pricing for the proposed service. These areas are essential needs to successful decision making. In the simulation CoffeeTime prepares for primary research by tailoring the research to the company's particular needs. In customizing surveys, questionnaires, interviews and possibly other research methods CoffeeTime will be able to expand its awareness and gather a more well-rounded view of its target market.

The data available to CoffeeTime was not originally produced by the company. CoffeeTime purchased the information from Total Access, a company who compiled the research. One may call the validity and reliability of the research into question because CoffeeTime did not conduct the research itself, thus being unaware of the parameters and statistics used or the way the data was acquired. A possible way of resolving the issue with the way the data was acquired would be to have a discussion with Total Access to determine its research methods and to identify any areas of concern.

Is very important to find out from Total Access how many the amount of the sample was. Another good idea will be for CoffeeTime to have an internal research and compare the information that they obtain with the information that Total Access obtained.

As the Manager for Business Development a method for further data may be required before deciding where to locate CoffeeTime outlets in India. A Feasibility Study is an excellent tool in gather additional information after any initial research. A feasibility study is an analysis of the viability of an idea. The feasibility study focuses on helping answer the essential question of "should we proceed with the proposed project idea? (Neal, 2007)" All activities of the study are directed toward helping answer this question.

A feasibility study is usually conducted after producers have discussed a series of business ideas or scenarios. The feasibility study helps to frame specific business alternatives so they can be studied in-depth. During this process the number of business alternatives under consideration is usually quickly reduced. During the feasibility process you may investigate a variety of ways of organizing the business and positioning your product in the marketplace. Is like an exploratory voyage and CoffeeTime may take several paths before they reach their destination. Just because the initial analysis is negative does not mean that the proposal does not have value. CoffeeTime may want be organized in a different fashion, or there can be market conditions that need to change for the idea to be practical. Sometimes limitations or flaws in the proposal can be corrected.

To obtain a random sample an organization simply labels all the sampling units in the population as 1, 2Ð'... N. Then pick at random from this list a set of n numbers. This sampling is generally done without replacement. CoffeeTime can obtain a random sample by identifying the population of all coffee drinkers.

In addition,