RAHUL JAIN (Striving for excellence) BCOM (H), PGPM, FCS

- 2 - Strategy formulation... An organization must select any of innumerable ways of seeking to attain its objectives. Strategies define how organizations should use their resources to meet their objectives. Hence, … strategies put constraints on employees to focus activities on what the organization does best or areas where it has an advantage over competitors.

Mission – Basic reason for existence Mission: How do we intend to win in this business? Factors influencing Mission Stakeholders Internal resources and Power Values of top management Past development of firm Business definition Products Markets Function (Technology and Processes) - 3 -

Vision- Yin Yang Core Ideology (Core values and Purposes) Envisioned Future (BHAG and vivid description) A vision, is more encompassing. It answers the question, "What will success look like?" It is the pursuit of this image of success that really motivates people to work together

Starbucks’ Mission and Vision Starbucks’ Mission Starbucks’ mission is to “establish Starbucks as the premier purveyor of the finest coffee in the world while maintaining our uncompromising principles as we grow” (Starbucks Website, 2006, p.1). Starbucks strategic plan to make its mission a reality is evidence by the company’s rapid expansion worldwide. Starbucks has locations in all 50 States in the US, plus the District of Columbia and Puerto Rico (Starbucks Company Fact Sheet, 2006). Starbucks can also be found in 36 countries outside the US (Starbucks Company fact Sheet, 2006). Starbucks is committed to buying only certified coffee in pursuit of selling the finest coffee. Starbucks’ Vision According to the company’s profile, (2006) its vision is to make Starbucks coffee the most recognized and respected brand in the world by using high quality roast beans to make coffee beverages along with other products. The company wants to develop enthusiastically satisfied customers at all times. They want to make positive contributions to their communities and their environment

Need for Solid Market Research Size of market Competitor Analysis Market Conditions and trends Profit Margins Revenue Opportunities - 6 -

Economic Analysis National Income Data Industry Growth Impact of changes in Interest rate, inflation, taxes on Growth Other Key economic data - 7 -

Market demand Market demand for a product is the total volume that would be bought by a defined consumer group in a defined geographical area in a defined time period in a defined marketing environment under a defined marketing program. It is not a fixed number but rather a function of stated conditions. Therefore it is called market demand function

Customer Analysis What type of customer will buy the product or service? Where are these customers located? How many potential customers (N) are there? How often do they consume or use it? What is the Competition? What are people paying? What is the Potential for the Market to Develop? What is my share of the Market? - 9 -

Market Potential Total Market Potential = Number of buyers in the specific market under the given assumptions * quantity purchased by an average buyer * price of an average unit

Key Steps in Estimating Market Potential: 1. Define your target market and market segments. 2. Define the geographic boundaries of your market. 3. Derive an average selling price. 4. Determine the average annual consumption

Company Sales Forecast: The various ways of estimating demand are: 1. Historical Sales figures 2. Forecasting current Demand by regression analysis, trend analysis 3. Estimating Industry growth 4. Estimating Economy's growth

Target Market A target market can be thought of as the customers who are most likely to buy from you and generally are described using demographic variables (gender, age, education) as well as psychographic variables (lifestyle and belief system variables). In many cases, a business may have more than one target market. Think about the automobile industry, Automobile manufactures have a number of target markets, i.e., truck buyers, luxury car buyers, economy buyers. Your business should be able to develop specific profiles for each of your target markets using demographic and psychographic variables

Revenue Analysis Revenues= No. of expected buyer*quantity purchased by an average buyer*price of an average unit Sales Budget