Marketing Capstone Assignment

Marketing Capstone Assignment Words: 4708

My wife and I have developed a marketing plan for the opening of a new antique store in our neighborhood. There are three reasons we believe this will be a profitable opportunity. First, we both love antiques, and have learned a great deal about authenticating, pricing and conserving the value of these pieces. Next, we have business experience from our venture in consulting work. And thirdly, one of the major antique stores in our area has ceased operations.

Develop a marketing plan for business We have completed our project in the city of Ashland, Kentucky. If our marketing research is favorable we will opt for a storefront building in the old downtown section of South Ashland. The reasons of the importance of this project were to allow us to have a formal plan to follow which will enhance our ability to make a profit from the antiques that we love to be around. But, also it is important to be able to serve our community and market with authentic antiques at reasonable prices.

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Another reason for our project was to secure a plan to attract other individuals in the community to sell their antiques at our store on a consignment basis. This will permit us to have a much greater offering while investing less in inventory. Our project was to design a workable marketing plan for the purpose of achieving maximum profit from our venture. We hope to be able to grow this business into a source of substantial income to supplement our retirement income.

There were several things to consider; competition from existing antique store being the most important. We live in a small metropolitan area, in three adjoining states. We identified twenty stores in this area who sell antiques. Although antiques are a niche market, we believe that retail stores in general have certain criteria to be successful. These include traffic, pleasant layout, visibility and available parking. Project Goals and Objectives The goals and of our project were as follows: 1. Develop a mission statement for our business. 2.

Work with area groups like “Mainstreet Committee” to obtain information about local business environment. 3. Conduct traffic research for the purpose of determining the best location for our business. To be successful, we must obtain a lease on a suitable property with good pedestrian traffic, parking and pleasant surroundings. 4. Gain sales data on other antique stores in our area. 5. Develop a line of specialties within the general antiques products. 6. Develop an action plan of strategies and tactics to be implemented. Rationale/Needs Assessment

The need for the project was twofold. First, there was a need to determine the feasibility of another antique store in our community. Second, we needed to develop a marketing plan which will guide us through the necessary steps toward a successful operation. Our rationale for completing the project is to be able to achieve the goals stated above. If our antique store is to prosper, it is necessary to have a formal marketing plan to follow. We knew that our chances of failure are much greater without following a formal plan. Timeline

Description of Goal/Objective/MeasureStartCompletePersonnel Start project develop and finalize goals and objectives. The measure is a list of goals/objectives. 9/2/20079/9/2007 Project Manager, Ernest Madden and Antique Appraiser, Beverly Madden Determine resources needed to complete the project. 9/9/20079/30/2007Project Manager, Ernest Madden and Antique Appraiser, Beverly Madden Obtain a copy of the latest business study conducted by “Operation Mainstreet”9/12/20079/15/2007Project Manager, Ernest Madden Develop a mission statement for our business. 0/2/200710/9/2007Project Manager, Ernest Madden and Antique Appraiser, Beverly Madden Contact Ashland Mainstreet Committee to solicit information and assistance in opening our business10/8/200710/28/2007Project Manager, Ernest Madden Perform a traffic study on the blocks where we would like to locate the store10/15/200710/16/2007Project Manager, Ernest Madden Research the market for the feasibility of another antique store in Ashland, Kentucky10/21/200712/12/2007Project Manager, Ernest Madden and Antique Appraiser, Beverly Madden Develop our line of specialization within the broader heading of antiques. 1/7/200712/15/2007Project Manager, Ernest Madden and Antique Appraiser, Beverly Madden Develop an action plan of strategies and tactics to be implemented. Finalize the marketing plan. 11/16/200712/31/2007Project Manager, Ernest Madden and Antique Appraiser, Beverly Madden Section B: Project Plan: Project Steps. The project had regular meetings with the team members. These meetings were used to evaluate the progress of the project. At these meetings we evaluated the project. We also discussed how to proceed in order to plan our upcoming activities.

The first step was to develop a mission state for our business. This was critical because we needed to define exactly what business we were to be in. Next, we would find sources of information concerning the local economy and market. It was determined that we could use the internet and local business leaders to assist us in gaining the necessary information. For our next step we would conduct a traffic study to determine which blocks in our target area had the most favorable traffic patterns. After this, we researched the other antique dealers in our area to get an idea of their sales numbers.

The next step was to research the market for the feasibility of another antique store in Ashland. Next, we developed a line of specialty antiques in which to concentrate. This was necessary because we knew that we could on be reasonably knowledgeable of a few select lines of antiques. Finally, we developed an action plan to be implemented. This plan included the strategies and tactics we would implement to launch our plan. Resources Required The materials and supplies needed were of several types. First, we needed space where we could meet. We would also need an office with a phone, computer and general office supplies.

These included a printer/copier, paper and etc. I also needed transportation to be able to move around from one place to another. We have only two team members: my wife and me. There were no special computers or software to be purchased. I used an existing computer with Microsoft Office. Estimated Budget/Costs The estimated budget for the cost of the project was $100. 00 and 100 hours. The This included: Office supplies$22. 00 Cell Phone Minutes`$36. 00 Auto Expense$72. 00 Project Manager, Ernest Madden73 ? hours Antique Appraiser, Beverly Madden21 hours Project Roles and Responsibilities

Members of the project team consist of the following: my wife Beverly, and me. ???Responsibilities of each team member were as follows; ???My duties were to act as project manager. In this role I would perform most of the leg work to develop the marketing plan. ???Beverly was assigned to handle mail correspondence and assist me in the research of information. Evaluation Process The project was evaluated at each meeting by the team members. At these meetings members discussed as to whether the project was on track. We evaluated the success of the project and agreed to continue in the direction we were headed.

One thing that was very beneficial was to discuss whether we were thorough enough with the individual steps along the way. At each meeting, we would discuss our earlier activities and determine if there were further developments in those areas. The actual marketing plan was the completion of this project. Chapter II: Project Completion and Journal Section A: Journal Date: September 2, 2007 Attendees: Beverly Madden and Ernest Madden This was our first official meeting. We met in the office of Bevern, Inc. at Ashland, Kentucky. At this meeting, we decided to begin the formal process of developing a marketing plan for our new venture.

We also decided to keep written records of these meetings. Our next decision was that I would act as project manager. We discussed how to record our activities, including expenses. We settled on keeping simple, but thorough notes. We also scheduled our next meeting date. Date September 9, 2007 Attendees: Beverly Madden and Ernest Madden At this meeting we focused on the resources we would need to complete our project. Our needs were simple: office space, computer with internet service, office supplies, phone and our automobile. We agreed to continue using the office facilities of Bevern, Inc, which we already own.

We decided to keep a record of the costs we incurred, and to repay Bevern, Inc, for actual expenses to it for the purpose of completing this project. All costs would be actual expenses except automobile usage. For our auto use, we would calculate by using the standard federal mileage rate. Other resources were our time. It was decided to make notations of time spent in the notes we were writing. Date September 16, 2007 Attendees: Beverly Madden and Ernest Madden At this meeting, we discussed the value of information about the local market and economy.

We decided to gain additional information of the local business environment and discuss that information at our next meeting two weeks from today. Date: September 30, 2007 Attendees: Beverly Madden and Ernest Madden At this meeting, we discussed our mission statement. We knew that this sounded academic, but we were advised that we should take this step now. The purpose was to understand the business we were to be in, and to be more likely to streamline our activities toward that end. Although we didn’t actually write our mission statement at that time, we began considering its details.

We agreed to both work on the mission statement until our next meeting. Date: October 6, 2007 Attendees: Beverly Madden and Ernest Madden We discussed contacting Ashland Mainstreet Committee to solicit information and assistance in opening our business. Date: October 13, 2007 Attendees: Beverly Madden and Ernest Madden At this meeting we discussed the time and methods needed to conduct a traffic study on the blocks we were interested in opening our store. It was decided that Ernest Madden would do the traffic study and report back next meeting. Date: October 20, 2007 Attendees: Beverly Madden and Ernest Madden

Ernest Madden gave the results of the traffic study. We discussed researching the local market to determine feasibility for another antique store in Ashland. Date: November 4, 2007 Attendees: Beverly Madden and Ernest Madden We discussed specializing in four lines of antiques. We decided we would specialize in glass, jewelry, music and war related antiques. Date: November 11, 2007 Attendees: Beverly Madden and Ernest Madden We discussed developing an action plan of strategies and tactics to be implemented and finalizing the marketing plan. Date: November 30, 2007 Attendees: Beverly Madden and Ernest Madden

It was agreed that the marketing plan was complete, and that we should move to the actual implementation stage. Section B: Completed Project The original project is complete. Although there may be modifications to the plan, it will be implemented as designed. The First item completed was the mission statement. (See Appendix A for this mission statement). We will keep this mission statement in mind to help us understand what our business really is. Next, we worked with the “Ashland Mainstreet Committee” to become more knowledgeable about the local business environment.

This is extremely important because, “if you don’t know where you are, you don’t know where you’re going”. Through this group we learned about the population, income and employment in our market area. The next step was to conduct a traffic study on the blocks where we would like to locate our store. At our previous first choice, we learned that traffic was often backed up due to cars waiting to make left turns. This made the scanty curbside parking slots harder to get into. Also, we learned that our third choice had ample parking and smooth traffic flow. And, this location was loser to a neighborhood with an older demographic???likes antiques better than the younger folks. By using a free internet service, Manta. com, we were able to gain useful information about the sales of the other antique stores in our area. Although we realize that this information may not be precise, we believe that it gives a good picture of our soon-to-be competitors. This is especially so in pointing to the leaders in sales and market share. Our next task was to determine the sub-groups of antiques we would specialize in handling. If we did not make this determination up-front, we ran the risk of being a “hodge-podge” shop.

We want to avoid that! We decided to specialize in antique glass, jewelry, musical and war related pieces. Although we probably won’t be able to stick strictly to these niches, we can focus our energy in this direction. Most importantly, we were able to develop a very workable action plan. This was crucial; without such a plan we would probably flounder in our attempts to start our store with momentum. Because of the above accomplishments, we believe that we can hit the ground running. This is very reassuring to us because this endeavor will entail the investment of precious time and money???both are a premium to us.

Section C: Project Evaluation We met some really nice people while conducting this project. One was Larry Jones, Chairman of the Ashland Mainstreet Committee. After looking at our plans he had kind words for us. He said, “More entrepreneurs should do this type of preparation before jumping headlong into business ventures”. Also, John Christie, a member of that committee and a real estate giant in this area, said that our preplanning was a step that many of his retail tenants should take notice of. Our final approval will come in the form of many happy antique buyers.

Chapter III: Competencies and the Project The following competencies were evident throughout this project: ???BK01 003730 Identify orientations that organizations have towards the marketplace. This competency is rightly in the first position. In marketing, the market orientation is the beginning of understanding the predicament of a seller of nearly any item. We must seek to know the needs of our customer and strive to fill those needs. Although in my project we already knew the class of items we would be selling, the marketing research helped us to identify the local demand for our specialties of antiques. BKO1 003731 Identify elements in the marketing mix. The four P’s, place, product, price and promotion figured heavily in this project. As already mentioned, we concluded that glass, jewelry, music and war related items would be in greater demand in our area. Also, we learned that the first impressions concerning business locations are not always as meaningful they at first appear. Our action plan was very detailed concerning price and promotion. All four elements are important, and no marketing plan would be complete without their consideration. ???BK01 003738 Identify trends in the marketing microenvironments.

Many factors are out of the direct control of businesses. Economic factors are cyclical and always present. They have direct effect upon the buying decisions of consumers. My appendix will show that economic data are a consideration in marketing decisions. But, there are also other factors that also play their own roles in the marketing function. For example, Cultural changes, new technology, disasters and political changes all have the tendency to affect marketing environments. These factors were present in this project: the study of economic and demographic data. BK01 003744 Identify competition from a market point of view. In marketing competition has a correlation with demand. Competition is briskest when supply is low and demand is high. Competition for a scarce product doesn’t affect the price like it does for products that are readily available. Also, competitors have unique abilities; a firm must use its abilities to the fullest extent. In our project, Beverly is a skilled antique appraiser; she will use this skill to identify products that are valuable and saleable. ???BKA1 00038212 Identify issues that impact the design of a sales force.

Although in my project, we had only two sales personnel, the same issues impact the design of small and large sales forces. First is product knowledge; you must know your product. Next is, know your customer. Although this is a little harder, we must strive to know the needs and desires of customers. Our antique store will not do well selling antique jewelry to a buyer only interested in Victorian farm implements. Also, some skills in communication, empathy and the sales process make for easier selling. ???TABL 001084 Identify and discuss types of legal liability that all businesses face.

Businesses face many types of legal liabilities: sexual harassment, discrimination, privacy, and security. All of these can lead to large cash settlements, huge legal costs and forced prevention or correction. Sexual harassment is a condition in which an employee has or believes they have been forced to perform or allow sexual acts by a co-worker or supervisor. Even talk which led to no action can be adjudged as sexual harassment. Discrimination can be on the grounds of gender, race, age, and religion or health condition. Discrimination occurs when someone has been singled out to receive unfavorable action.

Invasion of privacy occurs when an employer attempts to gain unnecessary information on an employee. Employers can be held liable for letting employees get injured, robbed or insulted at the workplace. At Oldtowne Antiques Mall, we would be held liable if any of these conditions occurred. It would be our responsibility to train our employees how to avoid committing these acts. If our employees did commit any of these acts, we would be legally liable. ???TABL 001087 Demonstrate understanding of the role of government regulation in business and commerce.

In the abovementioned liabilities, it was government who regulated adjudged and enforced the judgments. Also, the government regulates businesses in the following: hiring practices, minimum wage, workers compensation, overtime, handicapped facilities and worker safety. These are both state and federal regulations. At our business, I would be prohibited from discriminatory hiring practices. I would be forced to comply with minimum wage laws and overtime regulations. I would be required to provide facilities for the handicapped and OSHA would regulate workplace safety. Additionally, the EPA could regulate any omissions I have.

All this could be done without regard to cost to the business. ???TABT 001090 Identify various business structures and the advantages/disadvantages of each structure including sole proprietorships, partnerships, limited liability companies, corporations and franchises. The simplest form of business is a sole proprietorship. This structure has the least regulation, no fees and can be used without registration. The disadvantages are that all revenue is counted as personal income, there are no devises for perpetuity, and there is no shelter from liabilities. Partnerships can be simple or complex.

General partnerships are formed agreements which are filed as public records. The cost of creating partnerships is small, and regulation is minimal. The disadvantages are: all partners are liable for debts or misdeeds of any member???as pertaining to acts performed in the function of the partnership, a partner can stand to lose more than his original investment and there are no provisions for perpetuity. Limited Liability Companies are simple and cheap to form, there is scant government regulation and costs and can shelter personal assets from liability associated with the company.

The disadvantages are: it must be dissolved and reformed if partners leave or are added and there is no perpetuity. Corporations can be small or large, public or private for profit or not for profit. There is even a type S corporation. The advantages are: shareholders are limited to the amount of their investment if losses occur, income is divided between personal and corporate and corporations have perpetuity. The downsides are: income can be taxed twice; regulation can be enormous???especially for publicly traded corporations and required stockholder’s meetings and reporting can be very costly.

Franchises are contracts between franchisees and franchisors. The advantages are: for a relatively small cost a person can operate a nationally known business, the can have access to business procedures and marketing practices that a small business could not afford to develop and the returns can be greater than from a similar but non-franchised business. The disadvantages are: large upfront payment for the franchise can be charged royalties and other fees, contractual obligation to specific performances. If our antique store was a franchise, I would have higher upfront costs and less flexibility in management. TABT 001103 Describe the difference between consumer and business or industrial buying. Consumer buying is the largest segment of spending in the U. S. economy. It includes foods, clothing, fuels, entertainment, transportation, electronics and many other categories. It can be planned or impulse buying. It also covers healthcare and other things that were not necessarily chosen by the buyer. About the only thing that an individual spends income for which is not consumer buying is taxes. Businesses and industrial buying includes many of the same items???but in much larger quantities.

I will start with raw materials like coal, iron ore and liquefied sulfur. These items are used in the manufacture of other finished items. Then there are steel mills and components, railroads and wide-bodied jets that businesses purchase. These items are used to make products or profits for shareholders. One of the main differences between consumer and industrial buying is the process. An individual may plan for large purchases like houses and cars, but will also make impulse buys. This could include gadgets, books or magazines and a new outfit.

Businesses usually have formal buying procedures and even purchasing departments and managers. They plan their purchases, sometimes soliciting bids for lowest prices and use written purchase orders and other control procedures. In my antique store, I would plan major purchases like fixtures and inventory. I would issue purchase orders for all official purchasing. And, I would have procedures in place to control and account for all purchases. BKA1 003799 Select appropriate options for motivating intermediaries. When it comes to motivating intermediaries, these options seem most appropriate.

First is using reward power. Reward power can be very successfully used to motivate intermediaries. Economic or financial reward is the primary incentive with this method. If the channel member believes that the manufacturer can and will reward desirable performance, it may strive to achieve communicated goals and directions. The advantages of the reward method can be immediate and long-lasting. For example, a manufacturer may offer additional lines, territories or profits. This, of course, would be in consideration for following company objectives.

However, the main disadvantage would be that the channel partner would expect such favors for any change the company chose to impose. Legitimate power is somewhat different to the others listed above. It comes about when a legal or contractual situation is developed between the principal and the partners. It leads the channel member to understand tasks and procedures to be undertaken. that the company shall make certain demands, and that they must comply. For example, insurance companies have very detailed contracts with individual agencies which prescribe activities, tasks and procedures to be undertaken.

The advantages of such arrangements are many. Large companies can maintain policies and directives at the local level. Also because of the exclusivity inherit in these situations; channel members can be confident of continued corporate favor???as long as they are compliant. The disadvantages are few but important. Mainly, changes or modifications can be difficult because of legally binding agreements. This problem extends to both consigners. Expert power relates to the understanding that on channel member has special knowledge or expertise that is crucial in ongoing operations. The motivation ccurs if the partner believes that they must comply with overall objectives of the corporation in order to receive this expertise. An example might be like KFC’s secret recipe. Although other powers are present in these situations, franchisees understand that they cannot abandon the partnership agreement and still have access to this special knowledge. The advantages of this arrangement benefit both parties. The corporation can maintain control of its channel partners, while the partners can benefit from knowledge it may never independently attain. The disadvantages are that that corporate spying or other methods may divulge such secrets.

And, once secrets are widely known, there is a loss of superiority in the field of expertise. This could directly affect the viability of both parties. In our store there would be nor intermediaries between us and the final customer. ???BKA1 003797 Distinguish between direct and indirect channels of distribution. A direct channel of distribution is when the manufacturer sales directly to the end user. Indirect channel refers to having channel intermediaries. The reasons for choosing one or the other are varied. It may be best to go direct if you can not find suitable intermediaries.

This could be the case with a start up company. Or, it could be the case for a new product that requires extensively educating the buyers about its use. If the product is well-known and requires no special training, it will work best going through intermediaries. In my case, I would need extensive training on the point-of-sale software. This would be a case where a direct distribution channel would work best. ???BKA1 003779 Identify the roles of services as a component of a product. Many products have a service component. For example, any product that has a manufacturer’s warranty fits this definition.

Other services could be delivery, setup, follow-up service calls and ongoing customer support through a website. A good example would be a new car. If it were not for the warranty, few new cars would be sold at today’s price. This service is considered by both the manufacturer and buyer as a part of the overall product/service package. In my store, authentication would be a service component of the product. If authentification was not sold along with antiques, people would just be buying old junk. ???BKA1 003819 Identify tools for motivating a sales force. Many would assume that money was the only tool for motivating a sales force.

I will list some others here: awards, promotions, privileges, praise and a sense of a job well done. Commissions, bonuses, premiums and other money-based rewards have been used to motivate a sales force for many years. While they do work, other inducements are also helpful in motivating sales personnel. Awards like salesman of the years motivate others to achieve that award next year. Observing the top sales people promoted into management positions also inspire the sales force. But, even a “good job Joe” from the CEO can really set a fire of achievement under employees.

In my store, I use commissions, bonuses and kudos; kudos are cheaper. ???TABT 001173 Identify and explain the benefits and risk of global outsourcing. Global outsourcing is the practice of shopping the whole world looking for sourced of component parts in the manufacturing process. Because of globalization, such products can be sourced at a fraction of their domestic cost. But, there are risks as well as benefits. The benefits, aside of cost, could be quality because of specialization, adequate supply because of concentration of resources and uniformity because the products are used in all countries.

Some of the risks are: political change could alter the trade relations between the two countries; fluctuation is actual costs because of movement in the global currency exchange rates. Also because of the long distance shipping fuel costs can affect the real delivered price. Another factor is wars and other international relations. ???BKA1 003811 Recognize situations that call for a promotion strategy that emphasizes direct marketing. Direct marketing strategy is useful where intermediaries are unavailable.

Also, if fully qualified intermediaries are not available, it may be best to use direct marketing until intermediaries can be trained. Another situation where direct marketing is called for is in cases where sales for unique or custom-made products require a sales person with technical knowledge not widely available. A good example of this would be pharmaceutical sales. In this situation, a drug rep has highly specific knowledge about only a few drugs. In my store, specific knowledge of the different types of antique would be a situation where direct marketing would be called for.

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