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Would A Tuck Shop Be A Profitable Business?

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Introduction

Mathan Navaratnam 11F 12.08.2001 Would A Tuck Shop Be A Profitable Business? INTRODUCTION: I chose to do my coursework on the idea of setting up a possible tuck shop. This was so because as I am a student at Watford Grammar School for Boys I already have a good idea of the type of business that would be successful. The tuck shop will be part of the consumer market, which will specialise to satisfy the secondary school student subpopulation. In order to complete my coursework I will have to use a variety of methods and media to obtain and analyse evidence, which will give me a very good idea to whether my idea of opening a tuck shop would be a profitable business. I will need to find out what products my student customers would want and to find solution to any problems that I might identify. Some of these methods and media include market research and articles and statistics from places such as the Internet, television etc. Market research is the process of collecting, collating and interpreting information about the market for a product. Market research is important because it will help to plan how successful a possible business will be which is exactly what I require - suggestions to my possible bussiness' future. Market research would also help to predict the popularity and possible income and expenditure. Again it helps me to know what the potential customers demand and how great demand will be. There are two main methods of market research: * Primary research/field research (obtains original data or information, which did not exist before, from customers and other people) * Desk research/secondary research (uses data, or information, which already exists in printed form or computer files) ...read more.

Middle

For this question 15 respondents answered that they would visit 2-3 times a week and a further 15 said they would visit 4-5 times a week. This makes 30 people who would visit regularly. As the question was generalised it is hard to determine the exact number of visits. A fair way of trying to work out the number of visits would be to use the midpoints. Therefore the number of visits a week would be = (0.5x8 + 2.5x16 + 4.5x15 + 5x5) = 136.5. Therefore out of 43 people I can expect 137 visits, which is 3.18 visits a person per week. If I reflect this to the whole school then 1200x3.18 = 3816 visits a week my tuck shop would get. This is clearly good evidence that a possible tuck-shop would be successful. Now I need to know the possible income. As the possible answers in question three are grouped I will use the same method as I did before to determine the possible income. (0.25x14 + 0.75x15 + 1.5x9 + 5x2) = 38.25. On average per visit I would expect to receive 89p. If this is reflected on the whole school then in a week, the sales revenue I should expect to receive �3396.24. Again good evidence that it would be successful. Question four helped me to decide when it is best to run the shop. The most popular answers suggested to me to have the shop open at break and lunch if not at all times. The responses to question five clearly help me to which of the stock available to me should be best supplied as demand for different types of products varies. ...read more.

Conclusion

�125660 Cost of goods a year (37 weeks) �62830 Cost of wages a year (37 weeks) �7400 Cost of overheads a year (52 weeks) �7800 Cost of vehicle rent (37 weeks) �1110 Advertising (37 weeks) �92.50 Promotional offers/ideas (37 weeks) �3700 Net profit a year �42727.50 This information would best be represented on a graph for clarity and it would be easier to show percentages which can be a lot more useful for ease of understanding. After calculating this it is clearly evident that a possible tuck shop at Watford Grammar School for Boys would be very successful and profitable. However, there are many facts and points of view to take into deep consideration. Firstly many of the costs quoted to me and used in this coursework are estimates. The costs can vary quite a bit from what I was quoted at. This can be due to the demand or location etc. For example the rent of the area I require could increase if there is more demand for that particular space as the owner can raise more profits for himself if there is competition. Also due to lack of demand for products at my shop, my revenue would be greatly affected. So it would be wise to estimate a margin for error. I believe that the absolute maximum this could be is �400 a week. This would account to �20,800 a year which still would leave me with �21,927.50 net profit a year which is more than adequate. My gut feeling is that the business would be very profitable and successful without doubt. I also believe it would be worthwhile for other, non-profit, objectives. Such as making a success out of it for personal satisfaction and being in charge of something which I've built which undoubtedly would give me a great sense of achievement. ...read more.

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