ABC Company

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ABC Company

Problem Statement

ABC Company has been an offline company for the last 50 years. Its success over the last 20 years has proven that the market is receptive to our products and that a little creativity and innovation can go a long way. In an effort to build on the company’s success and to ensure that the company remains ahead of the pack, some of the advisory board members have presented the idea of taking the company online in order to reach a wider market and to cut down on operational costs. However, part of the advisory board feels that taking an existing business online has its share of risks and given the company’s record of accomplishment over the last 20 years, there is no need to. While they agree that recent information and technological advancements have proven to be successful tools for some companies, the advisory board members who are against taking the company online feel that not every business is suited for online expansion. Those who are for the idea feel that every company in this day should, at the very least, have an online presence. It is because of this divided opinion that the board has suggested additional research is carried out in order to determine whether to create an online presence for ABC Company or not.

Research Objectives

The research project is intended to address two major questions. The first issue to be addressed by the research is profitability. The researchers therefore aim to look at companies who, like ABC, deal with furniture and have online presence, in order to determine what their set-up, management, and other costs have been, and whether the profit margins due to their online market are favorable. Additional costs that may have been incurred due to taking the company online will be focused on, as will the companies’ market reach, and their revenues before and after online presence. These findings will be used to determine whether companies with similar products have profited from online presence, therefore whether it would be wise for ABC Company to follow the same course.

The second issue to be addressed through this research is the typology of online presence. With this in mind, the researchers will survey the opinions of potential consumers on whether they would prefer buying their furniture from an online store or from the local store. Further, the type of furniture that consumers would prefer to buy online as opposed to offline will be considered. Information gathered from the survey will be used to determine whether the company should set up an online store for its products or whether the online presence will be used to lead potential consumers to the existing stores. By focusing on the two issues stated above, the advisory board hopes to establish the way forward in addressing the problem of whether an online presence is profitable for ABC Company.

Research Plan

Type of Data

To address the research objectives mentioned above, we will use both quantitative and qualitative data, both of which will be primary. Qualitative data will be used to address the first objective of the research. In order to determine that ABC should have an online presence, similar companies that have gone online will be considered, and their margins, if favorable, will be an indication that online presence is beneficial. The gap between their operational costs and their revenues will be of focus. To address the second research objective – that which deals with the type of online presence – the data needed will be quantitative. The number of people who prefer buying their furniture goods from online stores would have to be more than that of those who prefer buying their furniture locally for ABC Company to consider establishing an online presence. Further, by using the quantitative data obtained, the advisory board will determine what type of presence – online store or company website – will be suitable for ABC Company. Quantitative data has been determined as the best type to address this question because data collection and analysis can be carried out quickly, allowing for timely use of the results.

Research Technique

Two research techniques will be employed to solicit information from respondents about the benefits, if any, of online presence for a furniture company. To address the first issue, interviews will be used. According to Patton, interviews have the advantage of providing in-depth information as the interviewer can always ask for clarification of a response given (103). In addition, interviews have the advantage of being relatively cheap. The interview method to be used will be that of face-to-face interview, where the interviewer will have already prepared structured questions. This makes the information obtained easily quantifiable and comparable. The respondents in this interview process will be accounting managers of furniture companies that have established an online presence. In the interview, revenues since establishment of an online presence, startup and operational costs, as well as actual market reach are some of the issues that will be considered.

The main reason for using a structured interview to gather this information is that most companies often have a ready report of their expenditures and revenues quarterly and annually. This can be obtained easily, however. A face-to-face interview therefore aids in further explanation of the information in company reports, as well as allows the respondent to give opinions on factors that have affected the company’s expenditure and revenues. In addition, non-verbal cues can be useful in the collection of information. To address the second issue, the research technique that will be employed is the survey method. The cross-sectional survey will be done using questionnaires geared toward current and potential consumers of ABC Company. Questionnaires, according to Cooper and Pamela, are advantageous for the sole reason that they are easy to analyze and quantify (206). In addition, questionnaires have the advantage of being extensive as they can be delivered via post, email or personally, thereby enabling collection of large amounts of data from a large and varied population. By use of both face-to-face interviews and questionnaires, we hope to find adequate and relevant information that will aid in deciding on whether ABC Company requires online presence.

Problems

The data collection methods mentioned above are not without their share of flaws. One of the main problems we are likely to encounter through use of the face-to-face interviews is unwilling respondents. Because our research is primarily geared at benefiting ABC Company, the competitors may be reluctant to share their information, or might even be tempted to give false information. However, we hope to overcome this problem by stressing to the respondents that the raw information obtained from all the respondents will be available to them for use in aiding them make similar decisions. While this may seem like sharing vital information with the competitor, this information can in actuality be obtained by anyone seeking to do research into the issue. ABC Company has chosen to carry out the research instead of waiting for other researchers to do it, as it is potentially vital to the company’s growth process.

Another problem we are likely to encounter in data collection is that of cost and time. Face-to-face interviews can be time consuming and rather costly. The respondents may not be available for the interviews during set times and unlike some other methods, face-to-face interviews require a time that is convenient for both the interviewer and the respondent. However, it is important that the respondent have a face-to-face interaction with the interviewer in order to establish a good rapport and to explain briefly, what is sort in the interview. To overcome this problem, we have designed an alternative written interview, which is only to be used after the interviewer has met the participants, and in the event that a face-to-face interview is not feasible. The questions in the written interview will be structured much like those of the face-to-face interview and will require minimal response from participants thereby will be less time-consuming. However, a written interview is not the original method chosen because establishment of a good rapport is especially important in gathering this information. If carried out well, we do not foresee any problems with the questionnaire method.

Ethical Issues

For the first research method, researchers guarantee the participants confidentiality. No identifiable information will be available to those who are not involved in the study. Further, the researchers assure that they will carry out responsible publication of the findings in order to advance research in the matter, not only to advance the prospects of the company. This is important in order to establish good relations with other players in the field (Moorman, Rohit and Gerald, 92). In the interview process, the researchers assure that all respondents will be obtained through voluntary participation, and that anonymity is not only guaranteed, but also required throughout the entire process.

Sampling

While developing the questionnaire, sampling decisions have to be made. To select the sample units, we have decided to focus on current consumers of our products, as well as potential consumers who have been obtained online via email. We sent out 300 questionnaires as we feel that given the time available, these will be adequate to establish preliminary findings. They are also an adequate representation of the population size. Below is the questionnaire that was used in the survey:

Questionnaire

We are carrying out a survey on the type of online presence that would be best suited for ABC Company, a furniture company with various outlets nationwide. Thank you for taking the time to fill in this questionnaire; it should not take more than five minutes. Nowhere on the questionnaire are you required to give any personal information that may be used to identify you. Please return your questionnaire via email or personally at the company’s outlets. All information will be treated anonymously.

1. I am years old.

2. My gender is Male Female

3. I do my shopping: (please tick one)

a. Mostly Offline

b. Mostly Online

c. Both Online and Offline in equal measure

4. Which of the following statements do you most agree with? (tick the appropriate choice)

a. I use online shopping for goods that are easy to ship

b. I like shopping online for goods that are problematic to transport, therefore will be delivered at my doorstep

5. Please tick one:

a. I have bought some furniture online before

b. I have never bought any furniture online

6. I would consider buying furniture online because: (more than one answer is allowed)

a. It is less time consuming than doing it locally

b. It is cost effective

c. It is hassle-free in terms of delivery

7. I would not consider buying furniture online because: (more than one answer is allowed)

a. It is impersonal

b. The quality of the product is not guaranteed

c. It is expensive compared to doing it offline

8. I have had the following bad experiences from buying my furniture online:

Data Analysis

Out of the 300 questionnaires sent out, 274 were returned. We found that 62 percent of respondents shop both online and offline in equal measure while 16 percent do most of their shopping online. The remaining 22 percent do most of their shopping offline. Male respondents over the age of 40 were majority of the online shoppers. We found that respondents mostly used online stores for goods that were easily shipped, and most were not open to buying furniture online as the quality of the product is not guaranteed. The second major reason why respondents would not consider online furniture shopping is cost. Additionally, we found that companies that had an online presence had benefited from it, but their operational costs, which included website management and shipping costs, were massive.

With the information above, the advisory board of ABC Company decided to go ahead and establish an online presence for the company, but not an online store. We found that a website is essential in directing traffic toward the company’s physical stores, which are located countrywide. However, it was found that establishing an online store is costly and not profitable for the company. The advisory board therefore recommends that ABC Company create a website that directs current and potential consumers toward their physical stores.

Works Cited

Cooper, Donald, and Pamela Schindler. Business Research Methods. New York: McGraw Hill Company, 2002. Print.

Moorman, Christine, Rohit Deshpande, and Gerald Zaltman. “Factors Affecting Trust in Market Research Relationships.” Journal of Marketing 57.1 (2003): 81-101. Print.

Patton, Michael Quinn. Qualitative evaluation and research methods.California: Sage Publications, Inc., 2001. Print.