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1. Do you know what is meant by “market research”? |
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2. Have you done any market research for your business or your product(s)? |
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3. Do you keep any sales records so that you can see which products sell well and which sell less well? |
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4. Do you try to specialise in producing or selling a few items in a way that makes your firm a specialist in its field? |
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5. Before you bring out a new product or service, do you: |
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(a) Look at the market and see if there is a place for a new product or service like the one you are considering? |
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(b) Study your competitors' products and try to make and/or sell something different? |
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(c) Try it out in a few places or on a few customers before selling it to everyone? |
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6. When you produce or sell a new product, do you highlight the specific things that make it different? |
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7. Do you sell different sizes and/or qualities of the same product? |
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8. Do you know who your competitors are and where they are? |
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9. Do you know how much your competitors sell each month? |
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1. Do you know what is meant by the expression “promotion of your products”? |
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2. A letter which has an attractive heading and is well typed makes a good impression on those who receive it. Do you think your letters make a good enough impression? |
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3. Have you at any time advertised the sale of your products in a newspaper or magazine? |
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4. Have you ever sent special letters to customers telling them about a new product which you are selling? |
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5. Do you think it is wrong to tell a customer that your goods or services are better than they really are? |
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6. Have you ever used special posters or leaflets to inform customers what you have for sale? |
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7. Have you ever asked new customers how they first heard of your name and what made them come to your business? |
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8. Do you know what is meant by the expression “point-of-sale advertising”? |
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9. Have you ever given your customers materials such as calenders, diaries, pencils or notepads which have the name of your business printed on them ? |
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10. Have you ever produced a printed list of special offers of stock which you want to sell off at very low prices? |
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1. Are you sure that your present method of transporting and distributing your goods is the best and cheapest |
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2. Have you tried other ways? |
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3. Have you really thought about who and where your customers are, and how many of them there are? |
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4. Have you thought about whether it is cheaper to use a wholesaler or your own sales representative for distribution of your products? |
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5. Is it only seldom that customers complain about the way they receive their purchases? |
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6. Do you visit the people and businesses who buy from you and find out what they think about your products? |
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7. Do you ever deliver your products to customers yourself? |
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8. Have you considered introducing a very quick delivery service to customers who will buy a large quantity of your goods and pay cash? |
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9. Is it possible for you to introduce a different and better method of distributing your goods to your big customers? |
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10. Do you personally go out and talk to all the customers who buy from you in large quantities? |
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1. Have you compared the advantages of doing your own selling (either yourself or by sales representatives) with the advantages of using wholesalers and/or agents? |
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2. Are you sure that the person who sells on behalf of your business understands your products or services and is able to talk about them to customers in the best possible way? |
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3. Do you deal with customers' complaints the same day they are received in your office? |
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4. Is the person selling your product strained to explain their uses and benefits to the prospective customer? |
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5. Do you give additional incentives to the people who sell your products when they make a sale? |
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6. Does someone from your business go out and visit customers and try to find out how satisfied they are with your products? |
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7. To promote your sales, do you have a leaflet or small catalogue you can give to potential customers which describes the products or services which you sell ? |
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8. Do you make sure to tell your staff that everyone who works in the business should think of himself or herself as a sales representative for the business? |
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9. Do you make sure that letters about sales, orders from customers and requests for quotations are dealt with at once? |
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10. Do you keep written sales records which tell you how much of each product or service is being sold every month and by whom? |
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1. Can you tell from your sales records: | |
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(a) Whether your sales are going up or down each month? |
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(b) Which goods or services are selling well or badly? |
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(c) In which parts of the city or parts of the country your product sells best? |
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(d) If there have been large increases or reductions in the sales of different products during the last year? |
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(e) How many orders you have received from each of your individual customers during the last 12 months? |
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2. Do you know the total number of orders or sales which you achieve during a year? |
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3. Do you know whether each sale you make is bringing you a profit or a loss? |
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4. Can you tell when one of your products is going out of date? |
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5. Can you find out quickly which products bring in most of your sales? |
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6. Do you sit down quietly every month to study the sales figures and make comparisons with the sales obtained in the past? |
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1. Do you have rules about payment and credit which you print clearly on your quotations and invoices and display in your business premises? |
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2. Do your prices allow for discounts to people who buy big quantities? |
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3. When you sell on credit, do you send out your invoices within a week of delivery of the goods? |
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4. Do you check the credit reputation of a new customer by asking your bank to contact the new customer's bank manager for a reference? |
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5. Do you try to find out about customers' ability to pay by talking to others who have done business with them? |
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6. Do you tell customers that you will give them a discount if they pay you cash? |
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7. Do you write down every month the names of the customers who owe you money and for how long they have owed you the money? |
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8. Do you ever make slow payers pay you something extra for being late with their payment? |
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9. Do you personally go and talk to all the people who have owed you money for more than two months? |
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10. Do you have a definite policy in regard to the collection of debts? If “yes”, write your policy below: |
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_________________________________________________________________
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1. Which of the following activities would you include in market research? Tick them (Ö):
Asking customers about your goods.
Asking your husband's or wife's opinion.
Going through business catalogues.
Checking your own order books.
The bus to the nearest big city.
Asking your sales representative's opinion.
2. State four things which you should consider when choosing the goods which you will make and sell:
(a) _____________________________
(b)_____________________________
(c) _____________________________
(d)_____________________________
3. Write below four things which you could do to promote your products or services so that customers will be more likely to buy from you:
(a) _____________________________
(b)_____________________________
(c) _____________________________
(d)_____________________________
4. Which factors would you consider important when selecting a sales representative?
(a) _____________________________
(b)_____________________________
(c) _____________________________
5. Write below three things which you can find out more easily about your products if you keep good sales records:
(a)_____________________________
(b)_____________________________
(c) _____________________________
6. The table below shows the monthly sales (in quantity) of a company, Soap Ltd., which manufactures different brands of soap.
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Item Month |
Jan. |
Feb. |
Mar. |
Apr. |
May |
June |
July |
Aug. |
Sep. |
Oct. |
Nov. |
Dec. |
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Soap brand X |
- |
- |
- |
4* |
5 |
7 |
9 |
12 |
11 |
10 |
11 |
11 |
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Soap brand Y |
20 |
19 |
19 |
12 |
12 |
11 |
10 |
7 |
5 |
3 |
2 |
- |
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Soap brand Z |
22 |
24 |
21 |
21 |
20 |
19 |
10 |
19 |
20 |
6 |
4 |
3 |
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Total |
44 |
43 |
40 |
37 |
37 |
37 |
29 |
38 |
36 |
19 |
17 |
14 |
* Manufacturing of brand X started in April only.
Now answer the following questions:
(a) Which information about the sales of the different brands of soap can you find in the above table?(b) Can you give a possible reason for the falling sales of brand Y?
(c) Can you suggest two ways in which Soap Ltd. could try to increase sales next year?
(i) ___________________________
(ii) ___________________________
7. Peter is in the business of selling timing machines. His usual selling price is 270 NU per timing machine. However, he is in a very competitive market so he has decided that he must offer discount to people who buy many timing machines at the same time. He offers a 5 per cent discount to those who buy quantities between 10 and 50; and a 10 per cent discount to those who buy quantities between 50 and 100. One day he has the possibility of selling 100 timing machines to a customer. Calculate the total amount that he asks for the 100 timing machines.
Now that you have completed the business practice exercises, turn to the pages which follow the action programme. There you will find the answers. Check your answers against the answer solutions which are given. How many correct answers did you get?
CHECK YOUR ANSWERS!
THEN GO TO THE HANDBOOK FOR
MANAGEMENT IDEAS
Now go to the Handbook and read thoroughly the management ideas in the same section there. You will then find that all the business practice exercises become easier to answer.
Count the number of times you answered “yes” or “no” for each set of questions. How many times did you answer “yes”? The more “yes” answers, the better you are in business management. Now look again at those questions you answered with “no”. Those are possible problem areas in your business. Choose the one which you think is the most important for your business. Take the most urgent problem first. Don't try to solve everything at once.
Now write the problem into the action programme on the next page, as we have done with the example. Then write in What must be done, By whom and By when in order to solve your problem.
Finally, go back to your business and carry out the action programme.
Figure
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Problem |
What must be done? |
By whom? |
By when? |
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Example: | | | |
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Too many people to whom I have given credit. They do not pay me. |
1. Set a credit limit of 100 NU to customers who have bought from me regularly for at least 3 months. 2. Strictly cash terms for casual customers. |
Myself and all my staff |
From today onwards. |
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1. |
Asking customers about your goods. Ö |
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Asking your husband's or wife's opinion. |
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Going through business catalogues. Ö |
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Checking your own order books. Ö |
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The bus to the nearest big city. |
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Asking your sales representative's opinion. Ö |
Figure
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(a) The kind of products my customers want. |
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(b) The quality and prices. |
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(c) The design. |
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(d) The sizes or dimensions. |
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(a) Advertising in newspapers and magazines. |
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(b) Using signboards on main roads. |
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(c) Placing posters on buildings. |
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(d) Sending special promotional letters to selected customers. |
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(a) The ability to learn about the technical aspects of your products. |
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(b) The ability to fit in with the kind of customers that he or she has to deal with. |
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(c) Politeness, patience and smart appearance. |
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(a) Whether your sales are rising or falling. |
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(b) Which goods or products are selling well and which are selling badly. |
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(c) How your sales representatives are doing. |
Figure
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6. |
(a) The sales of brand X are steady as from August. It is not an extremely successful product in terms of sales volume. | |
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Brand Y is competing with brand X. The sales of brand Y go down steeply in April when brand X is introduced into the market. Ultimately brand Y loses its market share altogether. | |
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The sales of brand Z drop suddenly in October. |
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(b) Brand Y cannot compete with brand X. | |
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(c) (i) Launch a marketing campaign to promote brand X. | |
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(ii) Start a new brand to replace brand Y; stop manufacturing brand Y. |
Figure
The business will ask 24,300 NU for 100 timing machines.
Figure
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