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Report About The Pastor Pats Vision Of Opening A One-Stop Store In Bankstown
0 Downloads | 13 Pages 3,093 Words | Published Date: 24/07/2017
The report is about Pastor Pat's vision of opening a one-stop store in Bankstown. It will give a detailed report on how to start and what factors to consider for the business. Bankstown is a town in south-western Sydney. It is located in the state of New South Wales in Australia. The location for the shop is apt for Pastor Pat as it is located near Sydney, the central business district. Bankstown is a commercial area, and its ethnic diversity has lead to the proliferation of restaurant, cafes, and malls. Therefore in term of location, Pastor Pat proposed one-store will attract huge consumers.
Reasons for proliferation of one-stop store
A one-stop shop is a business venture which offers customers access to multiple items in one place. So the name one-stop was given to this kind of business. This term was first come up in the United States in the 1920s to describe a business model offering customers the services of multiple needs from one location. The one-stop store is opened to meet the needs of the community, and it is often driven by a local authority. There might be other reasons for a one stop shop. Loss of any private sector facility like Bank also leads to opening of one-stop stores. Some like Pastor Pat for expansion of their own business (Ling 2013).
The proliferation of new products and change in customer’s interest has lead to the birth of one-stop service. This trend has triggered business person and financial service providers to offer their goods and services under one umbrella. This type of business venture is beneficial for both the service provider and customer. But before starting the business, business person like Pastor Pat should consider all the issues in implementing the one-stop store (Burns et al. 2013).
Theories and model in consumer behavior
Pastor Pat will first have to consider the consumer behavior and attitude towards the products he will offer in his store. Service provider first study customers and the process used for the venture, then they select and secure their products and services to satisfy the needs of consumers. The process combines all the elements of psychology, sociology, marketing, social anthropology and economics. It is an attempt to understand the decision-making process of buyers. The service providers analyze what emotions affects consumers buying behavior. They can do a study of the demographics of the area where they want to start their venture. It helps in understanding characteristics and behavior pattern of people within that location. It also studies the influence that other consumer groups have on the customer (Solomon et al. 2012).
The BZ 251 consumer behavior model will give an understanding of marketing theory and practice like consumer behavior. It will help in the development of marketing management strategies. This model will explain psychological and sociological factors of customers on how consumers are influenced by what product is available in the market and how many people are buying it. It analyzes the division of market share on competing product. Two methods for assessing models include ‘decoy-effect' and ‘lock-in' (Baptista et al. 2013).
Products are developed in a way that it appeals to the consumer and lure them to buy it. So to make the best product in a market, a consumer will not only have to go into detail of product design, but they will also have to understand the psychology and sociology of consumer group or network. The consumer behavior model describes mainly two aspects-
- Detail of consumer groups by how they chose the product and their individual behavior (psychology) and collective behavior (sociology) in the society.
- Information about brand management such as strategies taken by managers while changing brand attributes like price or quality in response to market changes (Foxall 2014).
Understanding consumer behavior
The major focus of service providers should be on customer retention, their relationship management, customization and one-to-one marketing. A business owner provides services to satisfy customers, and so the whole system for product development should be considered from the beginning to end of the cycle. Store owners can also build strategies to influence buyer's decision. Often payment options like credit or cash payments affect buyer's decision. There are also sales promotions where the customer is given premium or they invite competition which provides an incentive to buy immediately (East et al. 2013). There are five stages of consumer buying process-
- First is problem recognition stage where people identify what customer needs/
- Searching for latest information on the particular product.
- Identifying alternative or cheaper products available in the market.
- Intention to purchase the product
- The actual purchase of the product (Claiborne and Sirgy 2015).
So any customer will go through the above mentioned process before buying a product.
Another option is the post-purchase evaluation. It is the experience of the client after buying goods from the market. In this stage, customers compare the brand feature like its pricing and quality. It is about the customers perceived value of their product and how and its influence on their next purchase decision. For example, if a person buys a new phone and he/she is satisfied with the features, then they will consider the same brand in the future too. But opposite scenario may also occur like the customer may not like the product, and they will demand a refund, make a complaint or decide never to purchase the products from that brand again (Schiffman et al. 2013).
Customers also regret when they missed an opportunity of buying products. Consumers also play a role in the promotion of goods by narrating their experience with the brand. Experience with the product gives customer lot of information about the product (Oliver 2014). The learning experience of customers is affected by four factors-
First is how far the customer is motivated by the product. They look for information to confirm or negate a view about the product. Secondly, detailed knowledge of product creates a low chance of new hypothesis. Third is when there arises ambiguity of information. When consumers have doubt about product quality, they look for other sources to gain knowledge like word of mouth or advertising (Gunter and Furnham 2014).
Many people switch their mode of buying such as buying from other sources like the internet instead of from stores. They switch channels when a rare variety is available from that source or when it is cheaper and more convenient. For example, some people now prefer buying smart phones online. The advantage is that through online shopping they get the latest model which is not available on the market, it is convenient to shop this way sitting in the home only (Kushwaha and Shankar 2013).
Factors in the model
Several factors should be considered in consumer behavior. These are as follows:
Loyalty- Loyalty may be defined as the trend of customers to stick to same products. The changes in consumer buying a certain product are lesser if their sense of loyalty is stronger. The degree of reliability varies over a period. If there is no loyalty, there will be no dynamic behavior for buying products. The sale of such products will depend only on the offer and variety of product. Loyalty is associated with memory where consumers returned to old products after using something new which was not appealing to them. The success of outputs depends on these factors too (Aksoy et al. 2015).
Sociology- These factors determine how people shop certain products due to the influence of other people like friends and family members. Lock-in often takes place in the market. This happens when people prefer one product or brand, and only that brand dominates in the market. This factor is a challenge for a new business person coming with new products because they do not enjoy the advantage of customer loyalty, and it takes the time to build loyalty. However, some people always like trying a new product, and they don't stick to the same product. Apart from product promotion, praise of goods by such consumers also contributes the success of a product (Gifford and Nilsson 2014).
Psychology- It depends on the range of offer of products on the shelves and how this influence people's choices. People are first attracted by the advertising of the product. If the advertisement features a well known personality, then that advertisement get maximum attention. There is more chance of success of such products (Klöckner 2013).
The model also explained about the decoy effect in the market. It occurs when the introduction of third products significantly affects the market of share of two other products. It creates biases in consumer choices. So the decoy effect highlighted the importance of customer psychology regarding how they consider and judge quality before buying the product. It is also to be noted that sale of products varies with time. There may chance of two products dominating in the market or lock-in effect where only one product attains a virtual monopoly which cannot be broken (Ahn and Novoa 2016).
Other aspects of one stop store
One stop shops offer a wide range of products and services. This business requires the involvement of various sectors like cash management, brokerage investment, dealing with tax payment, insurance coverage such as on life and property, mortgage and loans and accounting services. The list will change according to the different product offered in the store.
Most one stop store has succeeded in the market due to certain advantages that it offers. It includes the following:
High revenue: One-stop shop allows business planners to gain the high level of profits due to a different product available on the same floor. Such setting is convenient for buyers, and it helps in attracting more customers. Once the customers are satisfied with the service and product, then a lot of revenue is generated despite competition from other products. Revenue is also generated by offering another financial plan to customers. There may e offers like use a particular service and get more discounts. Such strategies minimize the effort required to sell product and garner additional profit (Varley 2014).
Convenience: It is one of the most significant advantages of the one-stop store. It attracts customers because many things are available at the same place. It saves people's time and attracts more customers. This is appealing to consumers as it keeps much of their time which would have spent on going to a different location for buying various products (Brynjolfsson et al. 2013).
Planning for launching one-stop store
As Pastor Pat has decided to open a combined bookstore with furniture, music and gifts, this section will give detail on how to go about for introducing each product in the store. For launching books in his store, Pastor Pat will first have to study the retail market for booksellers in Bankstown. It will help him in gaining a lot of information about the bookstore and decide how to structure his business. He can also take feedback from the local public regarding what kind of book varieties they want. He can then accordingly prepare a business plan for his venture. The business plan will include financial investors and book suppliers, and his entire goal will be stated clearly to everyone. A marketing plan is the most crucial part as it gives an idea on how he has analyzed and understood the target market. Next step is finding a suitable rental space. Pat will have no problem in this regard as large retail space is available in Bankstown. The location is good because it is a commercialized area with a diverse group of people. He will need start—up capital for his business so he can do that by deciding how to get money. He may have sufficient capital with him or else he will look for investors and lenders. Balance is necessary for the success of his venture (Turban et al. 2015).
He should put some of his money into the business. This gives the investors the idea that he has enough money, and he will not default his loans. The second step is convincing capitalist and investors that his business will be a promising investment for them, and it will bring a lot of profits. Investors also become part of the business, and they demand a high return for investing into their business. Traders can also take plans. It is better for the small business person as the interest rate is lower than investors. The final activity for Pastor Pat will be to make his business legal. He can apply for a business license. When a business becomes legal, then people will be taxed both for corporate and personal income (Chesbrough 2013).
The next activity is stocking the bookstore. Pastor Pat could order books from different suppliers and publishers. He should put more focus on keeping popular varieties as well as some classic books in demand. The store can be attractively decorated and divide books according to interest; there can be a different theme of decoration for each section. It is important to check that there is enough stock of books that align market niche and demands. Next, come advertising the business by printing ads in the local newspaper, advertising online or innovative ways like a grand opening sale. More customers can also be attracted by promotion and awareness on social media. For the successful business, Pat can also consider offering other services at the bookstore. A small café will go well with the bookstore. People like to relax with light snacks and coffee while reading. These options create a better chance for success and purchase of books. These little changes distinguish one store from other and bring in more revenue (Lewis 2015).
He also planned to include music and gifts in his store. All this combination will be successful as these are things of interest for most people. The gift shop will be a complementary business for Pastor Pat in his store. The gift has a diverse variety and range. So first Pat will have to develop a concept regarding what kinds of gifts he wants to offer. Will it be traditional gift items like candles or display figurines or will he supply unusual gift items. There are lots of choices in this business according to different themes or interest. Pastor Pat can check trade fairs and manufacturer to see what kinds of variety is available. The Internet is also a good source to check a variety of gift items (Shimp and Andrews 2013).
Choosing the range of goods item is most crucial part of this business. The business will prosper if the product is unique and special, as well as it pricing is good. Efficient pricing and quality prevent dealing with other competitors in the market. When the product is unique, customers will automatically get attracted and buy the product. Pastor Pat can look for frontal space in the store for keeping items. It will ensure maximum visibility. Pastor Pet can invest some money in on advertising and attract customers. So the above mentioned ideas will guide him in launching his business (Civi 2013).
It can be concluded that the whole report is valuable information of theories and models of consumer behavior. Taking an example of Pastor Pat's plan of opening a one-stop store, it has explained ways by which consumer relationship and loyalty can be built. It has highlighted the features and advantages of opening a one-stop shop. It has also explained the whole process on how to Pastor Pat will go about in starting and launching his store.
Ahn, H. and Novoa, N.V., 2016. The decoy effect in relative performance evaluation and the debiasing role of DEA. European Journal of Operational Research, 249(3), pp.959-967.
Aksoy, L., Keiningham, T.L., Buoye, A., Larivière, B., Williams, L. and Wilson, I., 2015. Does loyalty span domains? Examining the relationship between consumer loyalty, other loyalties and happiness. Journal of Business Research, 68(12), pp.2464-2476.
Baptista, M.L., Martinho, C., Lima, F., Santos, P.A. and Prendinger, H., 2013. A Business Simulation with an Agent-Based Deliberative Model of Consumer Behaviour. In Games and Learning Alliance (pp. 215-223). Springer International Publishing.
Brynjolfsson, E., Hu, Y.J. and Rahman, M.S., 2013. Competing in the age of omnichannel retailing. MIT Sloan Management Review, 54(4), p.23.
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Chesbrough, H., 2013. Open business models: How to thrive in the new innovation landscape. Harvard Business Press.
Civi, E., 2013. Marketing strategies to survive in a recession. International Journal of Business and Emerging Markets, 5(3), pp.254-267.
Claiborne, C.B. and Sirgy, M.J., 2015. Self-image congruence as a model of consumer attitude formation and behavior: A conceptual review and guide for future research. In Proceedings of the 1990 Academy of Marketing Science (AMS) Annual Conference (pp. 1-7). Springer International Publishing.
East, R., Wright, M. and Vanhuele, M., 2013. Consumer behaviour: applications in marketing. Sage.
Foxall, G.R., 2014. Consumer Behaviour (RLE Consumer Behaviour): A Practical Guide (Vol. 3). Routledge.
Gifford, R. and Nilsson, A., 2014. Personal and social factors that influence proâ€environmental concern and behaviour: A review. International Journal of Psychology, 49(3), pp.141-157.
Gunter, B. and Furnham, A., 2014. Consumer Profiles (RLE Consumer Behaviour): An Introduction to Psychographics (Vol. 5). Routledge.
Klöckner, C.A., 2013. A comprehensive model of the psychology of environmental behaviour—A meta-analysis. Global Environmental Change,23(5), pp.1028-1038.
Kushwaha, T. and Shankar, V., 2013. Are multichannel customers really more valuable? The moderating role of product category characteristics.Journal of Marketing, 77(4), pp.67-85.
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Ling, W., 2013. Commentary on Brooner et al.(2013): Oneâ€stop shopping—what sells and what doesn't. Addiction, 108(11), pp.1952-1953.
Oliver, R.L., 2014. Satisfaction: A behavioral perspective on the consumer. Routledge.
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Solomon, M., Russell-Bennett, R. and Previte, J., 2012. Consumer behaviour. Pearson Higher Education AU.
Turban, E., King, D., Lee, J.K., Liang, T.P. and Turban, D.C., 2015. Launching a Successful Online Business and EC Projects. In Electronic Commerce (pp. 731-765). Springer International Publishing.
Varley, R., 2014. Retail product management: buying and merchandising. Routledge.
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