Well for what it's worth here they are..... hope you find them useful! To be totally honest I can't even remember what there is here and I can't be bothered to read them all through but I know that I found them useful during B200! :o) You will probably notice that as the course went on I didn't manage to type much up but hopefully what is here will be okay for you all and who knows, one day I may finish typing everything up! lol

Activity 1 - Module 1 (SWOT analysis of "My Corner Shop")

This is a simple technique used by businesses to determine their thoughts on their current circumstances. It details the strengths and weaknesses of the business internally as it stands at present, the opportunities for the business in the future and threats that could be posed by outside influences.

Activity 2 - Module 1 Part 1 (Transformation Model)

Activity 2 - Module 1 Part 2 (Mintzberg's Physiognomy)

Activity 3 - Module 1 (Keywords)

BACK TO TOP

Activity 4 - Module 1

The Influence of Government Policy

A) If the government lowered the rate of (household) income tax:

Government would have less income from household taxes

They would reduce subsidies from firms and

Increase government borrowing and therefore

Increase their interest payments.

Households would have more to put to savings, consumer spending and imported goods

Household wages would increase.

Firms would get more income from increased consumer spending and therefore

Firms would pay more tax and invest in more funding meaning they would pay more interest. 

B) If the government or central bank raised interest rates:

More interest payments for households and firms.

Less interest on savings for households and firms.

Households and firms would have less spending power.

Firms and foreign firms would take less in sales

Banks would have an increase in available funds and a decrease in the demand for them as no-one would borrow with higher interest rates.

Activity 5 - Module 1

BACK TO TOP

Activity 1 - Module 2

Stage 1

• Domestic appliances and televisions - rebounding strongly
• Computers, mobile phones and footwear - selling furiously
• Statistics - retail sales up 3.8% in June from 1 year ago
• Manchester Arndale centre - visitors 10% higher than 1 year ago
• Sheffield Meadowhall centre - 4% growth in average spending
• Statistics - 0.9% quarterly growth
• Varying widely across different sectors
• Electrical goods - 17% growth
• Furniture stores - 4% decline
• Big department stores - mired - hardware and bigger-ticket sales
• Debenhams - like for like sales down 3.6%
• Nominal retails sales - 0.5% increase in 2nd quarter - below average

Stage 2

• Varying widely across different sectors
• Electrical goods up 17% - domestic appliances and televisions - computers, mobile phones, footwear - rebounding and selling strongly
• Furniture stores down 4% - department stores mired - hardware and bigger-ticket sales down - Debenhams like for like sales down 3.6%
• Overall general steady increase
• - Manchester Arndale centre - visitors up 10%
• - Sheffield Meadowhall centre - 4% average spending growth
• - Statistics - retail sales up 3.8% in June from 1 year ago
• - Quarterly growth only 0.9%
• - Nominal retail sales 0.5% increase in 2nd quarter - below average

Stage 3
The demand for consumer goods is varying widely across different sectors. The sales of domestic appliances and televisions has rebounded strongly and the sales of computers, mobile phones and footwear are also strong. These are backed by the official statistics showing electrical goods sales are up by 17%.

Furniture stores, however, have reported a 4% decline and department stores are mired as hardware and bigger-ticket sales are slumping. Debenhams, for example, has reported their like for like sales are down by 3.6%.

Overall there is a general steady increase. The Manchester Arndale centre has shown visitors up by 10% while in Sheffield the Meadowhall centre has achieved a 4% average spending growth. Official statistics show retail sales are up by 3.8% in June from one year ago but the total quarterly growth is only 0.9%. Statistics also agree that the average trend is hardly a boom with only a 0.5% increase in the second quarter which is below average. Although consumers appear to be spending more, the statistics confirm that there is not a spending boom and there are only nominal increases.

Q2 - What factors can you identify in this report that are influencing consumer demand for high street goods? How are they impacting on consumer demand?

Stage 1

• Concern among consumer that there's a recession looming - fall in discretionary spending that dragged down retail sales volumes
• Cuts in interest rates - demand set to increase
• Falling base rates and strength of household balance sheets - improved consumer confidence
• Relaxed monetary policy to stimulate growth
• Counter effects on output of falling export competitiveness
• Impact of lower interest rates only just coming through
• Strength of consumer demand
• Buoyancy of housing market - not fed through to hardware and bigger ticket items
• Competitive high street - falling clothing sector prices
• Immune to the word "sale"
• Keener pricing more than over confident consumers
• Increased volumes reflects stable nominal spending and weaker prices rather than faster nominal spending.

Stage 2

Increases

• Strength in consumer demand - cuts in interest rates - demand set to increase
• Impact of lower interest rates only just coming through
• Falling base rates and strength of household balance sheets - improved consumer confidence
• Relaxed monetary policy to stimulate growth
• Competitive high street - falling clothing sector prices

Decreases

• Concern among consumers about recession looming - fall in discretionary spending that dragged down retail sales volumes
• Counter effects on output of falling export competitiveness
• Consumers becoming immune to the word "sale"
• Buoyancy of housing market - not fed through to hardware and bigger ticket sales

Conclusion

• Keener pricing more than over confident consumers
• Increased volumes reflects stable nominal spending and weaker prices rather than faster nominal spending

Stage 3

There are many social and economic effects on demand for high street goods. The government plays an important part with cuts in interest rates strengthening consumer demand. It looks set to increase although the impact of these are only just showing. The falling base rates and the strength of consumer balance sheets, however, have lead to improved consumer confidence. The government has also relaxed monetary policies in order to stimulate growth. This is shown in the competitiveness of the high street with the clothing sector prices falling.

There is concern amongst consumers though, that a recession is looming which has decreased discretionary spending and dragged down retail sales volumes. There are also the counter effects on output of falling competitiveness of exports. The buoyancy of the housing market has not helped either as it has not fed through to the hardware and bigger-ticket items markets. Consumers are becoming immune to the word "sale" as there are bargains around anyway with the increasing competitiveness of the markets.

It is keener prices rather than over confident consumers that have increased demand volumes of goods. These increased volumes reflect stable nominal spending and weaker prices rather than faster nominal spending. In conclusion there are factors which are swaying consumers both ways but the market is not expanding as rapidly as some figures may suggest and it is rather that competition is increasing and prices destabilising.

BACK TO TOP

Activity 2 - Module 2

(Forgot I hadn't typed up stage 3 but here are stages 1 and 2!)  Q1 - What are the factors that influence consumer demand for training shoes?

Stage 1

• Why buy them - sports, look good, comfort, please child, be like everyone else
• Why not - don't like them, several pairs already, no sports, too expensive, to be different
• Available for everyone
• Essential item in any contemporary wardrobe - unique fashion item
• Primarily marketed as sports shoe
• Manufacturers heritage and culture - Nike "coolest" image
• Advertising slogans - "Just Do It"
• Brand names
• Technologically advanced
• High availability of products on high street
• Most trainers bought for fashion and leisure not sports
• Fashion element - helped fuel growth in market
• Sporting image and shoes technology - driven the fashion trend
• Advertising - use of sports, pop and fashion stars
• Necessary accessory of global fashion trend
• Encompasses men and women of all ages
• Fashion main influence - late 90's taste shifted from trainers to more formal wear - slump!
• Society changes - fitness booms eg aerobics
• Premium pricing - established "exclusivity" of trainers
• Public image - socially responsible

Stage 2
Main factor - image/fashion

• Essential item in any contemporary wardrobe
• Unique fashion item
• Research shows most trainers bought for fashion not sports
• Fashion helped fuel growth in the market - driven by sporting image and technology of shoes
• Backed by shifts in taste statistics of late 90's - shifted to more formal wear - slump

Other factors

• Advertising - sold as sports shoes but promoted as being fashionable by sports stars, pop stars, and fashion designers
• Image created by advertising as "cool" and "trendy"
• High availability on the high street
• Pricing - premium - makes people think they are technologically advanced as promoted as this (terms used) - pay for quality - "exclusivity" created
• Public image of companies - socially responsible
• Social factors - peer pressure, keeping up with everyone else, fitness booms, unique fashion item

Activity 3 - Module 2

Supplier discovered that increase in price by 10% lead to decrease in sales by 20%.

1 - the price elasticity of demand?

Percentage change in demand = (-) 20% = (-) 2
Percentage change in price (+) 10%

2 - is it elastic or inelastic?

Elastic as greater than 1.

3 - would revenue increase or decrease when product's price is raised?

Decrease as price is elastic. Consumers would buy less of the product at a higher price resulting in lower revenues.

Activity 4 - Module 2

Stage 1

• Not to be industry leaders.
• To increase their effect on the environment - joint support for abolition of EU's 6% tariff on aluminium.
• Objective note to be the largest aluminium company but for industrial sense.
• Objective to create company large enough to benefit from economies of scale. - Estimated at minimum of $600m.
• No advantage in being the biggest.
• Freer world trade in aluminium.

Stage 2

• Not to be largest aluminium company as they believe there are no benefits in being the biggest.>
• Not to be industry leaders.
• Objective - main - to benefit from economies of scale estimated to be $600m.
• Increase effect on environment - EU 6% tariff - freer world trade.

Stage 3

Alcan, Pechiney,and Algroup have decided to merge to create a massive company but in order to be the biggest aluminium company as they believer there are no advantages in being the biggest. They did not intend their merger to make them industry leaders. 

Their main stated objective is a financial one. They wish to benefit from the enormous economies of scale available to such a large company which they estimate to be over $600m. Reducing costs in this method would dramatically increase their group profits. There also seems to be an underlying social objective of influencing their business environment. The main area they wish their merger to effect is freer world trade. They aim to influence the European Union to remove the 6% tariff that is currently imposed on aluminium and eventually use their influence to se the removal of all tariffs and restrictions to see a completely free trade market.

Q2 Does the report give us an indication of the 'minimum efficient scale' in the international aluminium industry?
(Minimum efficient scale - size/scale at production at which economies of scale have been used up - total costs still rising but average costs constant.)

Stage 3

The report does not really give an indication of the minimum efficient scale in the international aluminium industry. It does indicate, however, that the newly merged £17.4bn international company will still be benefiting from economies of scale of a minimum of $600m. It also states that there are no advantages in being the biggest. This indicates to me that the largest company in the industry, Alcoa, no longer benefits from economies of scale and has therefore reached the minimum efficient scale although no figures are given for Alcoa. I believe that the newly merged company may benefit from the enormous economies of scale for a while but soon their production costs will become to large for them to gain any significant economies of scale and they too will therefore have reached their minimum efficient scale.

Q3 What does this newly merged group expect its major industry rival to do?
Stage 1

• Attempt to maintain status as industry leader by making big acquisition.
• Subsequent unsolicited offer by Alcoa of $5.6bn for Reynolds Metals.
• Expected them to make an offer.

I believe that the newly merged company expected their main industry rivals to attempt to maintain their leading status by making a big acquisition. This was subsequently acknowledged as Alcoa made an unsolicited offer to Reynolds metals. The merged group APA expected this course of action. 

BACK TO TOP 

Activity 5 - Module 2

Q2 Has Microsoft abused its monopoly position? Would you need more information to make up your mind? If so what would you need?

I do not believe that Microsoft has abused its monopoly position. They have given good products at cheap prices, the results of which have not lead to consumers suffering. As the report stated consumers actually benefited as browsing software for the internet has become freeware.

I think that Microsoft's intention was more than likely to stifle competitors as the e-mail evidence suggests and that they may well have intended to abuse their monopoly position but I do not believe that this is the outcome they received. The takeover of Netscape by America Online (AOL) gives credence to the theory that Microsoft is no longer operating in a monopoly but do in fact have the competition. (The AOL/Netscape deal being a major competitor for Microsoft's internet products such as Internet Explorer.)

To come to a more solid conclusion a few more facts would be necessary. Although it is obvious that Microsoft makes a huge profit it would be necessary to examine the market shares for the products in question for the relative companies. The profit margin that Microsoft makes on Windows would also be beneficial as I believe if they were attempting to abuse their position this would be one method of doing so. As there seem to be no ill-effects of the apparent abuse of power by Microsoft on the consumer however I cannot agree with the prosecutions case. Consumers are well aware of alternative operating systems available and indeed there are many consumers which do not buy Windows. I cannot see how an abuse of power can be found when consumers still have a choice and choose to buy a Microsoft product.

Activity 7 - Module 2

Q1 - Why do the major brands that dominate the training shoe business source their supplies from South East Asia?

• Reduction of labour costs although raw materials are generally imported from elsewhere.
• Enjoy economies of scale and spreading fixed costs.
• Countries have less control over working conditions and pay in SE Asia than US allowing them to be exploited.
• Production adds no value to the shoes so outsourcing elsewhere (where costs are cheaper) adds to profits.
• Largely handmade so no technology involved - these nations have little technological knowledge so training etc not needed.
• Can exert some control over their environment and the economies in these nations thereby gaining more control over costs and increased profits.

Q2 - What proportion of the value added in the training shoe business do you estimate is appropriated by the workers who make these shoes?

• Very little wages paid by Western standards but to the workers these are high wages.
• Poor working conditions but better than some other businesses offer.
• Increased standard of living generally due to the investment in the economy.
• Support education practices in the country and invest in worthwhile causes there so workers benefit from these attempts at social concern.

BACK TO TOP 

Activity 1 - Module 3

Activity 2 - Module 3

• Inflation rates - house prices and mortgage rates
• Land prices in general
• Building regulations
• Customer needs/wants - market research
• General state of the economy - income levels as build high priced housing
• Politics - greenbelt land etc - where they can build
• Social trends - where people want to live, where people are working, rural suburbs etc