Executive Summary
In order to ensure the company’s invincible position in the fierce market competition, the company decided to launch the ”Bike Doctor” servicing. But before the launch of this service, it is necessary to consider its advantages and disadvantages. The disadvantage is that before any service is launched, it needs to pay a certain amount of capital cost, labor cost and time cost, such as professional technicians and construction of new sites and so on. The advantage is that it brings customer loyalty, which leads to an increase in sales revenue. Therefore, in order to better evaluate the effect of this “Bike Doctor” servicing, this paper will analyze from the following three aspects, so as to reduce the risks faced by the enterprise.
First, market analysis. By evaluating the sales revenue,the enterprise can understand the business growth volume and which businesses it needs to focus on. Thus, the enterprise can make a corresponding forecast and analysis on the future profit situation, which is conducive to better guiding the production and operation activities, reducing the blindness of the enterprise, and launching the products in a planned way. Therefore, it can maximize the enterprise’s economic benefits.
Secondly, Bike Doctor expansion planning analysis. By analyzing the impact of the implementation of Bike Doctor plan on sales revenue of parts and other businesses, the enterprise can test the importance of the implementation of Bike Doctor plan to the increase of store revenue, so as to provide an effective basis for its promotion.
Finally, customer demand analysis. Customer needs vary greatly. Without understanding customer needs, the enterprise can’t provide effective service and win customer loyalty. At present, enterprises adopt a closed way to ask questions, that is, to let customers answer “yes” or “no”, in order to confirm certain facts and understand the views of customers. However, this way of asking questions is difficult to find out the truth of the matter, so it is necessary to conduct a client questionnaire to better understand the customer’s view of “Bike Doctor” service promotion.
contents
Background information 3
Revenue analysis 4
Bike Doctor expansion planning 7
Customer insight analysis 9
Questionnaire preliminary planning 11
Conclusion and recommendation 11
Appendix 12
Questionnaire survey 12
Background information
Northern Cycling Collective is a professional bicycle shop in northern England, and this enterprise have online stores and retail stores. Northern Cycling Collective sells a wide range of bicycles, including three bicycle series: Road, Mountain (MTB) and Commuter bikes, as well as bicycle-related accessories, parts, after-sales service, etc.
Revenue analysis
As you can see from Table 1, In the Northern Cycling Collective’s main business (MTB,commuter,Road), MTB bikes are the most popular among customers, The annual revenue of MTB bicycles is as high as £20200. The average annual income of the three bicycles is £137333.3333, which means that the annual income of MTB bicycles is 45% higher than the average of the three bicycles. Therefore, the enterprise should put the main direction of production and management on the MTB bicycle. The commuter bicycle series has the lowest annual income among the three bicycle series, with an annual income of £87350, 36% lower than the average. As can be seen from table 2, the sales volume of commuter bicycle series is higher than the average. As a bicycle series with high cost performance , its sales revenue is at a lower level, which means that the enterprise should strengthen the marketing, or improve the technology and quality to increase commuter bicycles’ sales revenue and market share.
In table 1, the average value of other business income (clothing, Acccessories, parts, serving) of Northern Cycling Collective was £35133, and the income of Acccessories was the lowest, which was 18469.5, it was lower than the average of 47%. Parts was the highest, with £58595, which was 67% higher than the average.In addition, combined with table 2, we can see that in the sales revenue of parts, the sales of repair parts brought by Bike Doctor service are far more than the sales of other parts. Meanwhile, the labor income brought by Bike Doctor service is £39886. Therefore, it can be seen that the demand for Bike Doctor service is very great. In addition, the figures show that companies should invest more heavily in the MTB bike series than in the rest of the bike series in the Bike Doctor expansion planning.
Table 1
Combined with table1, we can see that although MTB’s sales revenue is the lowest of the three bicycle series, its number is indeed higher than the average of the three kinds of bicycles. It means that the sales situation of such a high cost performance bicycle is not very ideal, which requires enterprise to improve the sales income of MTB bicycle series from the aspects of marketing, technological upgrading, sales ability enhancement, market development and so on. In addition, it is clear that the number of maintenance parts brought by Bike Doctor service is much higher than in other projects.
Table 2
In table 3, we use the quarter-on-quarter growth rate to examine the sales of each business of Northern Cycling Collective in different quarters. From this, we can see that the sales revenue of various businesses increased the most in the second quarter, and the fastest growth was road bicycle series, which was 139.83%, and the slowest growth was MTB bicycle series, which was 66.48%. The third quarter was basically maintained, except for the commuter and road bicycle series, which showed negative growth in the third quarter, with -10.8% and – 10.25% respectively. All businesses showed negative growth in the fourth quarter, with MTB bicycle series declining the fastest, at -49.22%, and commuter bicycle series declining the slowest, at -25.35%.
The reason for the seasonal rise and fall is related to the seasonal attributes of bicycle products. In the second and third quarters, the weather is warmer, and the number of people who go out by bicycle increases relatively. Therefore, the demand for bicycle products will also rise substantially.
Therefore, in the off-season, enterprise should do some routine marketing management work, such as: organizing staff training to improve their business standards; Summarizing the marketing work in the peak season; Drawing up the marketing plan for the next year; Following up the old and new customers, maintaining customer loyalty; Changing channels and so on.
Table 3
Bike Doctor expansion planning
In table 4, we can see that the correlation coefficient of servicing and parts is 0.9, which means that they are highly correlated. In addition, we can see from the graphic structure that the growth trend between them is consistent. This means that the Northern Cycling Collective’s bike doctor service can greatly increase the company’s parts revenue. In table 1, we can see that through the sale of parts, in 2018, it brought £58595 sales revenue to enterprises, and £39866 sales revenue to enterprises through the provision of bike doctor services.
Table 4
In table 6 and table5, it can be seen that both in-store and maintenance parts sales will increase with the increase in the number of bike doctor services.
Table 5
Table 6
In table 7, the numerical value is processed, and bike’s data is calculated by dividing the sum of the sales income from the three bicycle series by 10, and then making the correlation coefficient analysis between this value and the value of bike doctor service, the correlation coefficient between the two is 0.98. It is also highly relevant, which means that the service of bike doctor can greatly promote consumer acceptance, thereby increasing the number of bike purchases.
Table 7
In table 8, by comparing the sum of the three bicycle series sales number and the servicing times of the enterprise, it is clear that the increase of the servicing times also leads to the sales quantity of the bicycle in the enterprise.
Table 8
Therefore, as an important part of sales and operation of Northern Cycling Collective, bike doctor service should be more widely extended to the production and operation activities of other shops, because it is not only a mode of production and operation, but also a cultural concept, reflecting the humanistic care of enterprise to customers, and a link between manufacturers and customers(Caruana,2002). Northern Cycling Collective can establish a closer relationship with its customers, establish the image of the enterprise, improve the reputation of the products, expand the impact of the products, and cultivate customer loyalty; Thus, it can play a strong support and promotion role in product sales and marketing.
Table 9
Before investing in any project, it is necessary to analyze its future economic benefits, including expenditure analysis, income analysis, investment return analysis and sensitivity analysis. From the above analysis process, we can see that the business of bicycle doctors invested by enterprises can bring considerable economic benefits to enterprises in the future. But investment needs to pay the cost, including construction sites, purchase raw materials, spare parts, training personnel and so on. Therefore, enterprises need to focus on investment. Although the annual sales of MTB bicycle is not much, but the sales revenue is the most, so it belongs to the high value-added business, which needs the most attention of the enterprise.
Customer insight analysis
Customer insight analysis is very important for enterprises, because customer needs are different, if the enterprises do not understand the needs of customers, enterprises can not provide effective services, also, it is impossible to win customer loyalty(Taylor,2015). The Northern Cycling Collective uses closed questioning to obtain customer information, which can find the problem more quickly and find out the crux of the problem. And 97% of the responses received from customers said they would use the service again. Excluding quarterly factors, according to table 10’s four sets of data,we can see that the frequency of customers using the biker service is basically in a straight line, which means that the estimate is basically accurate .
Table 10
Although this evaluation method can reflect the problem to some extent, this closed-ended question to answer “yes” and “no” is not a long-term effective way to analyze the needs of customers, because it does not rule out that many customers will answer questions in perfunctory form, resulting in inaccurate results. Therefore, in my opinion, enterprises should also use other ways to better judge the needs of customers.
1. When Northern Cycling Collective uses questioning to understand customer needs, it can use different questioning methods flexibly to achieve the goal in addition to the current methods.
Descriptive problem. Ask the client to describe the situation and talk about his point of view, which helps to understand the customer’s interests and problems.
Clarifying issues. When appropriate, ask, clarify the customer’s questions, it can also understand the needs of the customer.
Targeted issues. For example, asking a customer about the technical level of bike doctor service can help improve customer satisfaction and facilitate re-inquiry.
2.Understand the client’s needs by listening to them. When communicating with the customer, it is necessary to concentrate on listening carefully to the customer’s answer, try to understand what the other person is saying, understand what the other person is thinking and what the other person needs
3.Through observation to understand the needs of customers (usually face-to-face communication). In communicating with a customer, it is easy to learn about his needs, desires, and ideas by observing his non-verbal behavior.
4. Keep following up. Customer needs are not understood only through research. A few hundred samples alone cannot fully extract the customer’s core requirements. Understanding customer needs can’t rely on market research alone, but need to pay attention to customer needs anytime, anywhere. Industry changes will produce customer needs, daily sales feedback is customer needs, customer complaints are also needs, After-sales service personnel phone records also have customer needs, R & D staff innovation is also customer demand. In fact, whether in the market or outside the market, customers are constantly expressing their needs. Therefore, Only keep attention to the customer at all times, can we truly understand the customer’s needs.
Questionnaire preliminary planning
1.Enterprise should be clear about the purpose and significance of investigation-understanding of customers’ needs for bike doctor services
2.Organizing research staff-researchers need to train relevant research knowledge
3.Choosing the way of investigation: network Research and Field investigation
4.Identify the subject of the survey
5.Schedule the date of investigation
Conclusion and recommendation
In the final analysis, market competition is the competition of customers. Whether selling products or services, the final customer satisfaction is the criterion to test the success or failure of marketing work. For Northern Cycling Collective, the products it sells have strong seasonal attributes, so in the off-season, it is more important for enterprises to prepare for the peak season, such as personnel training, channel expansion, sales plan formulation and so on, to make full preparations for the arrival of the peak season. And the service of bike doctor is also very important for enterprise.
It is worth promoting in all stores. In addition, who can help customers really solve problems and provide profitable actions to customers, who can win customers. Therefore, customer insight analysis should not only stay on the surface, but also dig deeper into the needs of customers. The so-called customer insight analysis is to fully understand customers, study customer psychology, improve work shortcomings through customer feedback, improve service quality, and use the high-quality service in exchange for customer brand loyalty.
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