Business Research Report



HandyGear Internet Expansion 2013


Executive Summary


Handygear has been a retail marketer of quality goods for many years, but it is showing vulnerability in the competitive environment by not progressing in step with technology by establishing a presence on the World Wide Web. Research included in this report show that three quarters of today’s companies have established themselves on the internet. By not making a strong move into online sales, Handy gear is giving up competitive initiative.

More people use the internet now for shopping than ever before. In fact, more than half of the population of the United States will purchase something online by the end of 2012. The sales potential of the internet is enormous and growing with virtually no limits.

In addition, internet marketing carries inherent advantages. Costs of fulfillment are less than for traditional retail outlets since all interaction occurs online, including the transaction. This holds true throughout the customer relationship. Everything about the consumer’s experience happens on one website from initial shopping research to post sale service. If the customer requires a more visceral experience, he can then simply go to one of our stores after the online contact is made.

There are many ways to advertise on the internet and research will be required to determine what will work best for the company. Professional services needs to be secured for the development of a successful website and marketing campaign along with a budget and necessary logistics. Goals and benchmarks need to be created by executive management to ensure success.

The potential of online sales cannot be overemphasized. An online expansion will increase sales revenue and brand recognition while at the same time ensuring continued competitiveness in the market. This expansion will benefit all stakeholders in Handygear.






When this company began the only options people had to purchase merchandise was to go to a store or order through a catalog. Over the years, Handygear built up an extensive network of high quality retail establishments around the country to serve the market. The company never invested much in catalog or direct sales, preferring to base our business model on the more traditional form of face-to-face merchandising through established storefronts.

Handygear has become a recognized national chain and its products are used everywhere today. While relying exclusively on retail stores has served us well in the past, times have changed and more than ever customers are looking at the ease and convenience of internet shopping to buy products and have them delivered direct to their homes or work.

On the surface it seems much like catalog sales but it has evolved to become so much more than that. The internet today has become so widespread as to be considered ubiquitous. People can access the internet for shopping or browsing practically anywhere today on a host of portable devices with wireless networks available in many places and cellular service where they are not. In addition, at home consumers can now access the internet from personal computers and even their televisions at speeds faster than ever.

What this has created is a virtual marketplace that is practically limitless with the ability to reach far more consumers than any retail outlet. The possibilities of online marketing can no longer be ignored. In response, The Chief Marketing Officer has directed Assistant Marketing Manager Chris Whiteman to prepare an investigative report into a possible expansion by Handygear into online marketing for presentation to the Board of Directors.

Overall, this report will provide information on marketing opportunities available on the internet to enable the board to make an educated decision whether to invest in a virtual marketplace. It will do this by first presenting the main advantages and disadvantages of online marketing. It will then explore the potential profits and increased volume associated with an online expansion. After that, basic first steps will be explained to create a successful online presence and marketing campaign.

After all this research is presented, a set of recommendations will be given based on the knowledge gained for the board to consider.




Research Findings

The internet is vast and complicated. There exist many ways to reach consumers, not all of them applicable to marketing Handygear products. The same is true of sales. The medium itself can be daunting to establish a successful presence. From investigating many credible sources, three main points of relevance emerge to consider: 1) Overall advantages and disadvantages of online marketing; 2) the potential impact of online sales to the company; 3) what are the basic requirements of a successful online marketing campaign.


Advantages and Disadvantages of Online Marketing

More people use the internet today than ever before. Along with that comes a rise in the number of people that use the internet to shop. The internet has created opportunities for consumer interaction previously unimaginable. A 2011 book by authors Hamish Pringle and Jim Marshall called “Spending advertising money in the digital age: how to navigate the media flow” put it best in the introduction to the chapter about the internet:

What sets the internet apart from other media is its unique place within the purchase path and its ability to take the user from the initial point of interest right through to the sale, and thereafter to online customer service and electronic customer relationship management (eCRM). (Ch. 18)

This new marketing avenue carries with it a number of additional advantages as well, foremost among them being reduced costs associated with getting products to the consumers hand and a virtually limitless population to which to advertise. Other advantages include the ability to collect data on customers to target future marketing efforts more precisely, measuring product performance as well as allowing customers interactive sales experiences to increase satisfaction (Advantages & Disadvantages of eMarketing, n.d).

Online marketing is not without its risks, however. One common disadvantage is the lack of face-to-face experience. The field of online marketing is also complex and constantly evolving. This environment can make it difficult to track statistics on sales and return on investment, as well as other metrics such as site traffic and customer satisfaction (Long, 2011)

Analysis:  The potential of online marketing is vast beyond measure and simply cannot be ignored. The advantages to the company can be enormous in terms of increased sales and brand recognition. Obvious disadvantages are mitigated by securing professional services in development of sales, marketing plans and website design. Additionally, customers can use online resources to educate themselves about the products and then purchase them at one of our retail outlets, if they are inclined toward a more perceptual experience.


Potential Impact of Online Sales to Handygear

By the end of 2012, more than three quarters of the United States will be internet users. This means that, today, three out of every four people go online regularly; and this number will continue to climb. Of those people, nearly 200 million of them will shop online with 150 million going on to purchase products online. This means that roughly half of the American population will look to the internet and online marketing and advertising for purchasing consumer goods (Vaughan, 2012).

At the same time, additional statistics are showing traditional “brick and mortar” retail establishments sales have showed little to no growth in the past several years while online sales have grown steadily and are predicted to reach annual volume of 270 billion dollars by 2015 (Making it click, 2012). These figures show that the potential profits from establishing an online retail presence can be enormous.

In addition to realizing high increases in sales volume from moving into the virtual world, it may also prove to be necessary in order to remain relevant within the market. A 2008 study by the Federation of Small Business found that over three quarters of businesses had established a web presence. This high percentage clearly indicates that in order to remain competitive in today’s retail markets, a web presence must be established (Brychen & Simmons, 2010, Ch. 8).

Analysis:  Looking at these facts together shows that online sales could be enormously successful for the company and its stakeholders in terms of not only sales volume, but ensuring the Handygear brand continues to be well known in the changing environment of today’s retail markets. Not only that, but it must be noted that, given the high volume of retailers already on the internet, failure to establish a web presence would be surrendering the competitive initiative and could hurt the company overall.


Requirements for a Successful Online Marketing Campaign

A major advantage in developing an online marketing campaign Handygear has is a clearly defined product line that already sells in traditional markets and enjoys national brand recognition. In essence, all that needs to be done is to shift the sales to a virtual market environment. That being said, the development of a successful internet marketing campaign will be initially complex and will require constant monitoring as it continues to grow.

The first step needs to be a goal-setting session conducted by executive management in consultation with IT to establish clear priorities and targets for the marketing plan. The results of this will become the objectives for how the online campaign is constructed and executed (Successful Internet Marketing Begin with Goals, 2011).

Once goals have been established, a new marketing plan independent of the main marketing plan will need to be created and a web site constructed. Even though the product line will be the same as the company’s traditional retail stores, the new plan needs to approach emarketing as its own entity, developing a SWOT analysis and Porter’s five forces model specifically for the new market (Tanner, Raymond, & McLean, 2011, Ch. 16).

Many different avenues exist for advertising on the internet and research will need to be conducted to determine what will work best for the company. Options exist for everything from mass banner advertising and search-engine optimization to individualized e-mail marketing.   Once the campaign begins, testing and customer research will have to become an ongoing process (Eley & Tilley, 2009).

After that, benchmarks need to be established for monitoring these goals to ensure success and determine a timeline for expansion. As the campaign unfolds, contingency plans will be needed to provide for changes in case any of the benchmarks are not being met (Baxter, n.d.).

Analysis:  Setting up a successful online marketing campaign will be structurally similar to setting up a typical campaign; it will just require accommodation for the virtual environment. This will include the construction of a web site and research into the various means available for marketing on the internet. Securing the services of professionals skilled in this environment will be required by either employment or contract.



Overall, it is in the best interest of the company to expand into online sales. In addition to increased sales volume, the internet advertising and brand recognition could benefit all aspects of the company.

  1. Recommendation One: Secure the services of internet professionals, beginning with web designers and marketing specialists and may include others as planning progresses.
  2. Recommendation Two:  Establish goals and objectives for an advertising campaign and create a marketing plan. Provide for logistics, fulfillment and budget.
  3.  Recommendation Three: Construct a website and execute marketing plan while monitoring established benchmarks, making changes as necessary.


Internet use today is at the highest level it has even been and is growing. As the internet grows, online retail sales grow with it. Online sales are forecast to continue growth while traditional sales forecasts remain relatively flat. Online sales include other benefits such as decreased costs associated with fulfillment and a single environment for sales from initial shopping to post-sale customer service.

It will require a considerable amount of work and investment to create an online presence. This will include the addition of professional staff and office facilities. In the end, the increase in volume and brand recognition will benefit the company with increased volume and ensure it remains viable within the market.


Baxter, S. (n.d.). Successful Online Marketing Campaign. Retrieved from:

Brychan, T. & Simmons, G. (2010). E-commerce adoption and small business in the global marketplace: tools for optimization. [Books24x7 version]  Retrieved from:

Eley, B. & Tilley, S. (2009). Online marketing inside out. [Books24x7 version] Retrieved from:

Long, M. (2011). Potential Disadvantages of Online Marketing. Retrieved from:

Pringle, H. & Marshall, J. (2011). Spending advertising money in the digital age: how to navigate the media flow. [Books24x7 version] Retrieved from:

Tanner, J.F, Jr., Raymond, M.A., McLean, S. (2011). Principles of marketing and business communication (Version 1.0.1).  Retrieved from:

The Economist. (2012). Making it click. Retrieved from:

Traffic. (n.d). Advantages & Disadvantages of eMarketing. Retrieved from:

Vaughan, P. (2012).  25 Eye-Popping Internet Marketing Statistics for 2012. Retrieved from:

Web Savvy Marketing. (2011). Successful Internet Marketing Begin with Goals. Retrieved from:





Research Paper (Hydraulic Fracturing)


Fracking: The Future or the End?

An Exploration into the Viability of the Continued use of Hydraulic Fracturing

Christopher A. Whiteman

Before any new type of car is allowed to operate on public roadways, the public demands rigorous testing and research to be done to ensure that it is safe to use and does not pose any unacceptable to risk to the environment. The same could be said for any new drug, appliance, or other product; the public would want to know that it has been tested to be found safe and non-polluting. Then why would we allow an industry to operate that is both dangerous and a serious threat to the global environment?

Over the past decade or so, natural gas extraction from underground shale deposits has been ramping up at a dramatic pace in the United States. Perhaps the most common industry practice for extracting this gas is a method called hydraulic fracturing, known universally as fracking. The process consists of drilling wells to gas-bearing shale deposits deep underground. Next, volumes of secretive fluids mixed with sand and water are pumped into the well at high pressure to crack the shale, thus releasing the gas, then retrieving the gas along with varying quantities of the original water and chemicals with the addition of heavy metals and other toxic substances organic to the geology of the deposit (Bamberger & Oswald, 2012). The process has been used over a million times since the 1940s but has seen exponential growth with the introduction of new technologies such as horizontal drilling that allow access to deposits heretofore unavailable (Sakmar, 2011). Today, 90 percent of oil and gas wells in the U.S. use hydraulic fracturing (Michaels, Simpson, & Wegner, 2010).

As the industry has grown, so too have complaints and allegations of environmental and health risks associated with nearly every phase of this process. This has prompted the Environmental Protection Agency [EPA] to initiate a lengthy study primarily regarding the possibilities of contamination to both drinking water supplies and surface water, as well as the likelihood of other environmental and health hazards (Schmidt, 2011). Despite these concerns, the industry continues unabated. Current evidence indicates that hydraulic fracturing should be stopped because it has been shown to contaminate water supplies, pollute the environment with toxic chemicals, endanger public health, and contribute to global warming.

In most parts of America, dwindling water resources and ensuring future availability is becoming a concern. Yet, a growing body of case studies, public records, and reports all conclude that fracking poses a danger to watersheds of all types, including drinking water supplies. Gas drilling pollutes water in three main ways: the chemical compounds mixed with water and sand called fracking fluids, wastewater leaks and methane infiltration. An extensive report published in September 2010 called Fractured Communities cites hundreds of case studies including drinking water contamination in eight states where fracking is occurring. Incidents cited include spilling of toxic waste and fracking fluids into surface waterways and infiltration of methane gas into water supplies, among many others in thousands of violations of state and federal policies (Michaels, Simpson, & Wegner, 2010).

A case in point from Pennsylvania shows that faulty well construction and lack of safety procedure compliance on the part of Cabot Oil and Gas caused numerous spills of both fracking fluids and wastewater between early 2009 and July 2010 (Michaels, et al., 2010). The company was fined and penalized for the spills after  failing to resolve the problems, but the permits remained valid. This illustrates the inability of current laws being unable to effectively regulate the industry. The list of recommended actions provided in the Fractured Communities report is exhaustive and would take years to implement. If any official body considered them, they would require both radical policy changes and major expenditures (Michaels, et al., 2010).

In addition to wastewater and fracking fluid pollution, methane leaked from wells has contaminated drinking water supplies(Michaels, et al., 2010).  In Pennsylvania, authorities have concluded that water wells near gas wells have incidence of dissolved methane 17 times the average (Lustgarten, 2011b). Concerning the presence of methane in drinking water, a professor of environmental sciences at Duke University named Robert Jackson conducted a test taking samples of drinking water from 60 residential wells near operating shale gas sites. These were tested for the presence of dissolved methane. The Department of the Interior has established standards for the presence of methane in water. Those standards call for hazard mitigation steps be taken at levels greater than 10 mg per liter and consider levels above 64 mg per liter to be explosive. According to the study, the tested wells were significantly greater than the actionable level, averaging 19.2 mg per liter (Schmidt, 2011). Water well and even home explosions have been attributed to methane infiltration in Pennsylvania (Michaels, Simpson, & Wegner, 2010).

Another recent study conducted by the EPA in Wyoming used two separate tests to show that fracking pollution has effected both deep aquifer water and shallow surface water (Lustgarten & Kusnetz, 2011). In one of the tests, the EPA analyzed drinking water from 1,000 foot wells drilled specifically for testing near fracking operations and found ten contaminants that were consistent with known elements of fracking fluids, including benzene, which is a carcinogen. The other findings showed that surface groundwater around old gas and oil waste pits were contaminated, but pointed out that there was no way the pollution from the deep wells was caused by the surface pits. The deep well contamination was caused by fracking (Lustgarten & Kusnetz, 2011).

In many cases, the industry is aware of the problems, but scattered fines and test results are not enough to sway common practice without the presence of regulatory authority. The main problem is lack of regulation. On the federal level the EPA exempted fracking from the Safe Water Drinking Act in 2005 (Schmidt, 2011). More locally, states have instituted varying degrees of regulation, but no state has sufficient regulations in place to ensure water supplies stay clean (Finkel, 2011).

Water is not the only thing at risk from gas wells. Evidence also continues to accumulate implicating fracking in other environmental damage ranging from ozone pollution to soil contamination, continually allowed by weak or non-existent regulation.

The Clean Air Act focuses primarily on larger emitters of air pollution for regulation. Shale wells almost never have single source emissions large enough to qualify for regulation under the act (Schmidt, 2011). This leaves a loophole for the industry to exploit because when measured as aggregate emissions, shale wells present a considerable source of nitrogen oxides and volatile organic compounds, both constituent parts of ozone. Ozone is a major air pollutant and greenhouse gas (Schmidt, 2011).

The chemicals used in fracking fluids and materials brought back to the surface from underground pose another source of contamination. Drillers are not required to disclose the chemicals they use in the hydraulic fracturing fluid. Despite this, some of these chemicals are known and can be quite dangerous in the environment (Schmidt, 2011). Shale gas wells can be fractured repeatedly once drilled, depending on the density of gas in the shale (Sakmar, 2011). Each fracturing operation requires up to 5.5 million gallons of water with as much as two thirds or more of that returning to the surface. This produces hundreds of thousands to millions of gallons of waste liquid called backflow that is stored in open, often unlined pits (Manuel, 2010). These fluids contain many dangerous substances, including heavy metals and radionuclides in addition to the original fracking chemicals (Schmidt, 2011). This creates a toxic sludge that is seldom disposed of properly and often contaminates surrounding air and soil (Finkel, 2011).

State and federal authorities are aware of these problems but have been slow to act. Legislation has been introduced in the past two sessions of congress that could potentially make fracking safer but so far, no action has been taken (Sakmar, 2011). A handful of states have issued moratoriums on issuing new permits, though they are only temporary in most cases (Schmidt, 2011). This type of action needs enactment on a broader and more permanent scale until the industry can demonstrate environmental safety.

The combination of ways that fracking contaminates the environment and water resources creates a clear threat to public health. According to Professor of Public health at the University of Pittsburgh Bernard Goldstein, no health studies have been done to quantify the effects of shale gas mining (Schmidt, 2011). The lack of sufficient studies is only the beginning of the public health threat.

To begin with, many of the these wells end up in residential areas and the ramifications of having these massive operations literally in the backyard are severe, starting with controversy regarding land development versus mineral rights, leading to noxious fumes, noise and light pollution of an industrial site next door, and accusations of direct health effects (Schmidt, 2011). Large trucks moving heavy equipment and materials operate 24 hours a day in residential and rural areas (Schmidt, 2011). These trucks often operate with little regard for public safety. In Pennsylvania, for example, authorities issued 669 citations and 818 written warnings to trucks hauling wastewater alone in a two and a half year period (Michaels, et al,. 2010).

Going beyond that, another study conducted in six states on rural residences and farms close to gas wells found that in every instance, medical difficulties were developed by humans and animals because of soil and water contamination (Bamberger & Oswald, 2012). Medical symptoms developed by the humans in the study ranged from burning eyes and respiratory trouble to fatigue, abdominal pain, headaches, and skin conditions. Some of these conditions were severe enough to require hospitalization and physical relocation of the occupants from their homes.  Bamberger and Oswald emphasize that their study focused on farm animals, pointing out that these animals make more suitable test subjects because they remain exposed to the environmental conditions present in a contaminated area on a continual basis (2012). In all of these studies, the effects on the animals were more severe than on the humans with drastic results including reproductive difficulties and death in addition to milder symptoms. Two of the case studies provided natural control groups in groups of animals separated on the same property, with the unexposed animals not suffering any ill effects at all (2012). A test conducted by the Pennsylvania Department of Environmental Protection of known chemicals used in fracking concluded that 73 percent of them were dangerous to humans and animals. Some of these chemicals are endocrine disruptors for which the developmental damage may not be fully realized for generations (Finkel, 2011).

The EPA has committed to a lengthy study of the industry primarily focusing on water contamination(Lustgarten, 2011a) but there is no indication how long it could be before results are known, though another source cites preliminary results within three years (Manuel, 2010). Completion of the study and any subsequent action by lawmakers could take years, even if annually authorized funding remains (Sakmar, 2011). As Bamberger and Oswald as well as Jackson point out, case studies are imperfect evidence, there being no control groups and other elements to ensure a true quantification. If this is true, however, and there have been no true scientific studies to determine the health effects of gas mining, it begs the question of why is this permitted in the first place.

On a far grander scale, the largest threat of fracking is an increase in global warming brought on by increased methane emissions associated with the industry. Natural gas is mostly methane. Methane gas has a large greenhouse gas profile and is more of a threat to climate change than carbon dioxide based on a twenty-year profile (Howarth, Santoro, & Ingraffea, 2012). What this means is that the global warming potential of methane is greatest within twenty years of emission, and while it is in the atmosphere, it is much more radiatively active than carbon dioxide, thus contributing to a higher, faster spike in atmospheric temperature. Methane creates 44 percent of the United States greenhouse gas footprint (Howarth, et al., 2012).

Methane leaks throughout the drilling process and common industry practice is to vent methane directly to the atmosphere following active fracturing (Howarth, et al., 2012). Up to 85 percent of gas extracted after fracking is completed gets vented to the atmosphere instead of being burned off or captured, according to the EPA (Howarth, et al., 2012). Compounding this estimate is the result of a study by investigative public interest group Propublica that determined the amount of methane emissions being reported by the EPA from gas wells and pipelines was up to 50 percent underestimated (Lustgarten, 2011b). This creates an immeasurable quantity of methane directly injected to the atmosphere.

In addition to that, 30 percent of natural gas consumption in the United States is used for electricity generation while the remainder is mostly used for heating. The existing infrastructure for heating gas distribution is old and inefficient; resulting in additional emissions that are also immeasurable, further contributing to climate change (Howarth et al., 2012).

The United Nations and a large percentage of the scientific community predict drastic changes in Earth’s climate in the near future unless drastic reductions of greenhouse gas emissions, particularly methane, happen now (Howarth et al., 2012). The United States is a major global contributor of greenhouse gases and its industry practices are copied the world over regarding the natural gas industry (Sakmar, 2011). In fact, the U.S. has made itself a model for the world to follow with the Global Shale Gas Initiative, founded by the Department of State in 2010 to help other countries develop their own methane gas resources (Sakmar, 2011). If global warming is to be reversed or at least not exacerbated, then the U.S. needs to drastically reconsider its energy policy.

Hydraulic fracturing for shale gas contaminates water supplies and is exempt from regulation at the federal and most state levels. It causes soil and air pollution because of this under-regulation and imperfect industry practices. The pollution caused results in a direct threat to public health and the environment in the air, the water and above and below the ground. Furthermore, unchecked methane emissions are a strong contributor to global warming, bringing the world closer to irreversible tipping points in global climate. As it is practiced today, hydraulic fracturing should be stopped because it has been shown to contaminate water supplies, pollute the environment with toxic chemicals, endanger public health, and contribute to global warming.


Bamberger, M., & Oswald, R.E. (2012). Impacts of gas drilling on human and animal health. New Solutions, 22(1), 51-77. doi:10.2190/NS.22.1.e

Finkel, M. L. (2011). The rush to drill for natural gas: A public health cautionary tale. American Journal of Public Health, 101(5), 784-785. doi:10.2105/AJPH.2010.300089

Howarth R.W., Santoro R., & Ingraffea A. (2012). Venting and leaking of methane from shale gas development: Response to Cathles et al. Climatic Change, in press.

Lustgarten, A. (2011a, June 29). EPA fracking study to focus on five states – but not Wyoming. Propublica. Retrieved from

Lustgarten, A. (2011b, December 29). Fracking cracks the public conscience in 2011. Propublica. Retrieved from:

Lustgarten, A., & Kusnetz, N. (2011, December 8). Feds link water contamination to fracking for the first time. Propublica. Retrieved from:

Manuel, J. (2010). EPA tackles fracking. Environmental Health Perspectives, 118(5), A 199.

Michaels, C., Simpson, J.L., Wegner, W. (2010, September) Fractured communities: Case studies of the environmental impacts of industrial gas drilling. Riverkeeper. Retrieved from:

Sakmar, S.L. (2011). The global shale gas initiative: Will the United States be the role model for the development of shale gas around the world? Houston Journal of International Law, 33(2) 369-416.

Schmidt, C.W. (2011). Blind rush? Shale gas boom proceeds amid human health questions. Environmental Health Perspectives, 119(8), A348-353.

Marketing Plan (Research project)


Company G

3-Year Marketing Plan



Company G has a long and well-established history in the electronics marketplace. Its XG Brand in particular is known worldwide for quality products and the logo is instantly recognized on store shelves. The “Super G Combination Wireless Phone and Media Stereo Headset” is a new product for the company, hereafter referred to in this plan as the “Super G” or “SG”.  Moving into the personal media segment of the market is a natural product development strategy for the company. Its position considering production efficiencies and brand recognition will prove to be a winning and profitable combination for all stakeholders.

Mission Statement

“We enable consumers to improve the quality and convenience of their lives by providing innovative electronics solutions.”

The Product

The Super G is a wonderful new device in the personal media and telecommunication market that pairs a noise-reduction, retractable boom microphone equipped, and Bluetooth-technology enabled communication device with a stereo dual-ear personal media-listening device. The device is lightweight and comes with a variety of headset wearing options to make it universally appealing to the target market. The device also has an input jack for non-Bluetooth enabled media devices.

The SG will simplify any users listening experience when combined with a media device. Its controls are simple and intuitive once linked to a device. It is useful for activities ranging from driving to exercising. This suite of features improves quality of life by making it simpler to access media and communication while on the go without having to juggle devices. Its sleek but rugged design and intuitive interface make it more convenient to use than other products on the market. The pairing of the two previously separate devices into one unit serves both elements of the mission statement.

Target Market

Personal media and wireless communication devices have become ubiquitous in modern culture, in use today by every segment of American demographics from students to the elderly, wealthy to lower middle class and an array of occupations and activities from driving and commuting to exercising. Thus, the SG will target a vast but clearly defined market: all users of wireless communication and personal media devices.


Competitive Situation Analysis

Consumer Product Classification

Small electronic devices in the personal media and communication market are typically purchased with at least some background knowledge beforehand. Consumers will research at length different brands and features hoping to only need to purchase a single unit and use it until it breaks or a more modern unit becomes available. The reputation of a particular brand is often of particular importance and consumers often develop brand loyalties for their devices. Consequently, shoppers will often pay more for their preferred brand and list of features than for other products. They will also go to greater lengths to find these products.

These elements combine to place the Super G solidly in the Specialty product Classification.


Analysis of Competition using Porter’s 5 Forces Model

Competitive Rivalry  There are a fair number of competitors in this market, however, most product lines are of inferior quality. The basic model Super G is top shelf for this device. Company G has a solid customer loyalty base that will help establish the new product. In addition, whereas similar products may be almost disposable in their quality, the exceptional quality of the Super G will essentially remove the risk of switching. Production is at existing facilities, so exit risks are minimal as well.

Threat from New Entrants  The production process used by Company G provides significant economy of scale and would be difficult to duplicate.  It would take considerable time and investment for a competitor to design a comparable product and get it to market. Given the low cost of production versus the sale price, the company also has a wide margin for competition.

Threat from Buyers  The SG will be marketed solely through retail distributors. Early marketing plans are light on volume discounts to allow for future negotiations of volume pricing. In addition, no exclusivity is promised to any distributor and Company G may elect to develop a direct sales marketing plan in the future as a fallback. Most distributors will be vendors of many products and brands and will probably have similar products, yet they will carry the SG as a high-end offering.

Threat from Suppliers  There are two possible threats from suppliers, one is for raw materials and the other is for component parts. For the raw materials, Company G should continue to search for other sources to provide assurance of material availability. For the components, the company should pursue production contracts to ensure supply while at the same time explore possibilities to produce them organically.

Threat from Substitutes  Right now, most consumers are using two separate devices to achieve what the SG does. Given time, the ease of use and convenience of the SG will become known and be considered the standard by which others are compared. Some similar devices of inferior quality and price are available and are not competition for the SG. Marketing will ensure that the SG is available from both chain and online retailers to ensure availability.

SWOT Analysis

There are other strategic elements to consider for the marketing plan, both intrinsic and external. To analyze these, the components have been entered into a SWOT Analysis. Overall, the company looks good in the analysis internally, starting from a position of strength with few intrinsic weaknesses. Externally, the opportunities are much stronger than the threats. The threat, however, will need to be monitored as time goes by.

STRENGTHS  *indicates core competency

  • Superior name recognition*
  • Strong financial position*
  • Product is most reliable in industry


  •  New suppliers of raw materials
  •  Reliance on 2 components from outside vendors
  •  Product is in a new market segment for company


  •  Concept is still new
  •  Large market potential
  •  Many possibilities for product expansion


  •  Established competitors
  •  Sales are contingent on separate product
  •  Concept will be duplicated



The first core competency to acknowledge is the history and position of Company G. The company has been in the electronics business a long time and its brands are well known. Its products have an overall reputation for quality and this will definitely be a boost as the SG comes to market.

The next core competency is the company’s strong financial position. Company G enjoys both a high credit rating and a low debt-to-equity ratio. This puts it in a strong position to both make the initial launch of the SG and support its future expansion.

Next, consider the high quality of the product itself. Company G has devoted a considerable amount of research and engineering into the SG concept. This effort has paid off with what will be the highest quality product of its kind on the market.


There are several weaknesses inherent to the Super G. The first of which is new suppliers of raw materials for use in production. Since these suppliers are new, relationships with them are still developmental. While pricing arrangements are secure for product launch, there are no guarantees that they will be honored in the future.

Again, the need to purchase two subassemblies for the device from outside vendors is another weakness. While prices and supply are secure for now, future prices for these units cannot be assured.

The Super G is in a new market segment for the company. Company G knows little about personal media or wireless communications products or their industry. While extensive research was done on the design of the SG, the company is vulnerable in this market due to lack of expertise.


The concept of this integrated design is new enough that there is plenty of opportunity to perfect it and become the standard of the market.

The potential of this market is virtually limitless. The number of personal devices that can link to the SG is in the hundreds of millions worldwide. Each one of those devices is a potential sale.

While the SG will launch with one basic design there will be many opportunities for future customization and accessories to personalize the device.


There are established firms already marketing similar devices of inferior quality. If they ever upgrade any of those designs, they could represent a threat.

Sales of this product rely on a consumer already owning and being familiar with another product. Changes in the wireless personal device field could affect the viability of the SG.

This concept will be duplicated in the future. Any future designs that prove superior to the SG and are priced competitively could supplant the targeted market position.


Market Objectives

Product Objective

Launch the Super G headset and produce sales that will not only make the project break-even but increase overall company sales profits by 3 percent within 3 years.

Price Objective

Suggested retail price for the Super G is $90. Basic wholesale price is $65 per unit. Bulk discounts will be available. Total cost to the company is roughly $45 per unit.

Place Objective

Company G will use retail distributors for all sales of the Super G. Marketing outlets will be established in traditional storefront operations and online.

Promotion Objective

Create and build customer awareness of the Super G to generate sales.

Marketing Strategies

To facilitate the above objectives, a series of strategies has been developed that will follow in stages the primary objective of achieving profitability within three years. Once the device penetrates and is established in the market, new variations on the product will be introduced to keep sales invigorated. At one year, the Super G will become available in colors. At two years, a lighter weight model will be released. These steps will ensure marketing goals are met.

Product Strategies

  • Ensure desired initial inventories are present in all outlets prior to launch.
  • After initial production runs, the SG will be released in five different colors at approximately one year after launch.
  • At the two-year launch anniversary, a new lighter weight model will be released.


Price Strategies

  • Distributors will be given a “net 30” payment plan after opening accounts
  • Volume discounts will be applied at the rate of 7% for a whole pallet, and 3% for a half pallet order.
  • An additional 3% discount will be offered for accounts that are paid immediately.
  • Delegate an online account representative.
  • Delegate an account representative for large chain stores.
  • Delegate or establish a new account representative position to service media and cell phone niche markets.
  • Create an online advertising presence and create campaigns for launch and each subsequent product expansion.
  • Advertise nationally and in select local media using magazines and store flyers.
  • Provide periodic product demonstrations at select locations and create infomercials from them for online release.

Place Strategies

Promotion Strategies


Explanation of Strategies

Each of these strategies works in a logical sequence to support the main objectives. The product and promotion strategies will work off each other to support the stages of the planned product expansion. The location strategies ensure that all likely sales opportunities will receive adequate representation. Finally, the sales strategies incentivize bulk purchasing and 0 balances while leaving sufficient leeway for further development coinciding with increasing sales.

Tactics and Action Plan

These individual steps will be taken to execute the above strategies. Each action will have a clearly delineated timeline or frequency of occurrence and the individual leaders responsible for their completion. As the launch unfolds, additional tactics may need to be utilized to keep up with demand and the changing market.

Product Action Plan


Due Date

Responsible Party

Set up a meeting with store or department managers for all accounts to confirm projected sales match inventory Prior to launch Product Manager
Oversee subsequent runs available in five colors to be released one year after initial launch Two quarters post launch Product Manager
Beginning immediately after launch, product manager will coordinate the design and production of a lighter weight model to be released on the two-year launch anniversary Two years post launch Product Manager


Price Action Plan


Due Date

Responsible Party

When all new distribution accounts are opened, sales manager will ensure credit checks are and limits established Prior to launch and ongoing as new accounts are established Sales Manager
Sales agents will communicate discounts to encourage volume sales. Ongoing Sales Manager
Sales agents will communicate discount to encourage immediate payments. Ongoing Sales Manager


Place Action Plan


Due Date

Responsible Party

Establish sales account and associated advertising with Prior to launch Sales Manager
Integrate new products/accounts with territories of existing company representatives. Prior to launch Product Manager
Create sales arrangements for space and service at music stores, cell phone stores, and car and home audio stores. Launch date to one year Sales Managero one yearat music stores, cell phone stores, and car and home audio stores.


Promotion Action Plan


Due Date

Responsible Party

Create online advertising portfolio by establishing accounts with Amazon, Facebook and GooglePlus First quarter after launch Advertising Manager
Purchase advertisements in selected magazines and arrange for features in store flyers Launch date Advertising Manager
Design script, set for product demonstrations, and create traveling demonstration crew. First quarter after launch Product Manager




Monitoring Procedures

Regular monitoring to measure the success of the Super G is critical. Weekly staff meetings and monthly sales reports will give the vitals of the product’s progress toward established goals. Quarterly measurements of promotion effectiveness will illuminate the path ahead. The product manager will deliver a quarterly report for top management.

Monitoring Activity

Due Date/Frequency

Responsible Party

Regular review of strategies and earnings with top level management Quarterly Product Manager
Sales report generated and distributed to all management staff Monthly Sales Manager
Product management staff meeting to monitor individual accounts and examine opportunities weekly All product leadership staff, product manager
Review and analyze promotion effectiveness, plan future promotions Quarterly Advertising Manager


Workplace Discrimination Research




The history of this employee with the company goes back two years. He took leave under the Family and Medical Leave Act eleven weeks ago. The reason for the leave was his wife gave birth to twins prematurely. The leave was granted and now the employee is ready to return to work. During his absence, his department had a change in management. Along with the return to work, the employee has requested pay covering the duration of the leave. Management has denied this request.

The Family and Medical Leave Act of 1993 (FMLA) entitles an employee to take up to 12 weeks of time off work for the birth of a child, among other reasons. There are circumstances that must be met to make an employee eligible for this leave. First, the employer must be covered by the FMLA and have a minimum of 50 employees within 75 miles of the employee’s location. The employee must also have worked for the employer for at least the previous calendar year and have worked a minimum of 1,250 hours during that year. The employee must also give 30 days or reasonable notice of intent to take leave. When the employee returns to work the law requires he be given his original job at the same rate of pay and benefits or an equivalent job with the same pay and benefits. While the employee is out on leave, the employer is required to maintain the employee’s health insurance. The employer is not required to pay the employee for the leave time (Wage and Hour Division Fact Sheet #28, 2010).

In this case, Notice of the leave could have been immediate since the babies came prematurely. By the company granting the leave to begin with, it is assumed then that the employer must fall under the provision of the FMLA for number of employees as well as the employee having worked the minimum number of hours to qualify. The company is required to have maintained the employee’s health insurance premiums while he was out on leave and to reinstate him at his previous level of pay and benefits. Unless it is company policy, the law does not require the employer to pay the employee’s salary for the time he was on leave. No violations of the FMLA occurred in this instance.



During a recent annual performance review, a discrepancy was discovered regarding a promotion. An employee that is 68 years old was denied a promotion because of age. The promotion was given to another employee who is 32 years old. Within the review, the promotion hinged on a particular score, the 68-year-old received “above average” on this score while the younger employee received a rating of only “adequate”, establishing the older employee as more qualified for the promotion.

This case falls under the Age Discrimination in Employment Act of 1967 (ADEA). This law protects employees over the age of 40 from discrimination based on age when being considered for promotions, among other issues. All other things being equal, this law would require the employer to consider the older employee for promotion first. The only exception to this rule would be if the employer had fewer than 20 employees, the law does not apply. Under certain circumstances, the employer can make a deal with the employee to give up their rights under this law. The employee must be encouraged to seek legal counsel and have a minimum of 21 days to consider before accepting (Facts About Age Discrimination, 2008).

Unless the company has fewer than 20 employees, this is a clear violation of the Age Discrimination in Employment Act. At this point, the company has only two options. The first is to award the promotion to the older employee retroactively. Failing that, the company can ask the employee to consider waiving their right under the law for sufficient inducement.



A job applicant was denied employment based on a disability of being paralyzed in both legs and requiring a wheelchair for mobility. The employer has informed the applicant that the job would entail moving all over the company’s seven floor headquarters building and using elevators. The control pads for the elevators would have to be moved down four inches to enable the applicant to access them. The employer has declared this is an undue hardship for accommodation.

The Americans with Disabilities Act of 1990 (ADA) prohibits discrimination by an employer based on disability. The ADA defines a disability as a major physical impairment. The law states that if a disabled applicant is qualified for a job and is able to perform the job “with or without reasonable accommodation” then the applicant must be considered for the position (The ADA: Your Employment Rights as an Individual With a Disability, 2005). The law describes moving or substituting equipment as reasonable accommodation. If the employer is unwilling or unable to provide accommodation, then they have to demonstrate why or how providing an accommodation would create an undue hardship for the company. The applicant would then have the option of providing the accommodation themselves before they could be passed over for the position (2005).

The employer in this situation is in direct violation of the ADA. If the company is large enough to need a seven story building for its headquarters, then moving some control panels in no way would create a demonstrable undue hardship for them. In any case, other sections of the ADA would require moving them if the building were required to provide any sort of public access whatsoever. In addition, the applicant was never given the option of providing for his or her own reasonable accommodation.





The United States Equal Employment Opportunity Commission. (September 8, 2008). Facts About Age Discrimination. Retrieved from


The United States Equal Employment Opportunity Commission. (March 21, 2005).  The ADA: Your Employment Rights as an Individual With a Disability. Retrieved from


United States Department of Labor. (Revised February, 2010). Wage and Hour Division Fact Sheet #28: The Family and Medical Leave Act of 1993. Retrieved from







Critical Ratio Analysis


This memorandum analyzes Company G at the end of year 12 by explaining 13 applicable ratios derived from the comparative income statements and balance sheets from years 11 and 12 and comparing the data to corresponding industry quartiles.

Current Ratio

Current Ratio measures the company’s capacity to pay its short-term liabilities. This ratio derives from dividing total current assets by total current liabilities. A higher ratio is preferable. For year 12, the current ratio is 1.79. This is a decline from last year’s ratio of 1.86. When compared with industry quartiles this ratio falls below the median of 2.1 but above the lower quartile of 1.4. This ratio indicates a weakness.

Acid-test Ratio

The Acid-Test measures the company’s ability to pay current liabilities if they were all due immediately.  This is found by adding cash, short-term investments and net current receivables and dividing the result by total current liabilities. This ratio should be around 1.0. This year it is 0.43. This is a drop from the year 11 ratio of 0.64 and falls below the lowest quartile of 0.6. This also indicates a weakness in the company.

Inventory Turnover

Inventory Turnover rate indicates how many times per year inventory is sold and replaced. Higher rates are preferable as the faster inventory is moving indicates how profitably the company is operating. This rate is found by taking the cost of goods sold and dividing it by the average of the beginning and ending inventory from the cycle. In this case, the ratio is 5.17. This is another drop from year 11, which saw a rate of 6.1. Both of these rates fall below the lowest industry quartile of 8.3. This also signifies a weakness.

Accounts Receivable Turnover

This ratio is a measure of the company’s success in collecting from credit customers. The formula is to divide net credit sales by the beginning and ending average of net accounts receivable. This ratio is better high. For year 12, it is 30.46. This is a drop from last year’s ratio of 32.2. This year’s drop puts the company below the lowest quartile of 31.4. This ratio is also a weakness.

Day’s Sales in Receivables

Day’s sales show how many days a balance is carried in receivables. This is calculated in two steps. First, net credit sales are divided by 365 to arrive at an average daily credit sale. Next, the average of beginning and ending net accounts receivable is divided by the average daily credit sales.  A lower number is better. For year 12, this ratio is 11.98. This is up slightly from year 11 that had 11.1. This places the company above the median of 13.5 but below the upper quartile of 11.3. While there was a drop from last year, collections for the company are not a concern.

Debt Ratio

This ratio reveals a company’s ability to pay all of its debts. This number is found by dividing total liabilities by total assets. A lower debt ratio is preferable and is currently 29.54%. This is a slight increase from last year’s ratio of 28.34%. Even still, it is above the 30% threshold of the upper quartile. This is definitely a strength.

Times-interest-earned Ratio

Also called the interest-coverage ratio, this shows how many times operating income can pay interest expenses. To find this ratio, divide operating income by interest expense. The higher the result the better and the company looks good here with a 35.55 at the end of year 12. Last year’s ratio was 31.12 and both ratios are above the 29.7 level of the upper quartile. This is a strength.

Rate of Return on Net Sales

This shows the percentage of sales that result in profit. It is found by dividing net income by net sales. For year 12, this is 6.21%, up from last year’s 5.43%. This year’s number places Company G above the median quartile of 6.12% but below the upper quartile of 7.55%. The ratio is increasing and is above the industry median so there is no concern.

Rate of Return on Total Assets

This ratio measures profitability for creditors and shareholders. To compute, the sum of net income and interest expense is divided by the average total assets from the beginning and ending of the period to arrive at a percentage.  Again, a higher ratio is better. This year’s rate is 13.92%, up from last year’s 12.3%. This year moves the company above the median of 12.3% but below the upper quartile of 17.2%. For the same reasons as return on sales, this is no concern.

Rate of Return on Common Stockholders’ Equity

This ratio narrows the profitability measure specifically to common stockholders. Often called return on equity, it shows how much profit stockholders made. It is calculated by subtracting preferred dividends (which for Company G is zero) from net income, then dividing this number by the average of stockholders equity at the beginning and end of the period. This year saw a drop in this ratio to 18.75% from 20.2% a year ago. As this year’s ratio is still within the upper quartile above 18.6%, this return is a strength.

Earnings per Share of Common Stock

EPS, the common acronym for this ratio, shows the amount earned by each share of common stock. To begin computing the ratio, treasury stock held by the company is subtracted from issued stock to arrive at the number of shares outstanding. Net income (with preferred dividends subtracted, if applicable) is then divided by this number. A higher EPS is better. In this case, it is $1.05 for year 12, up from $0.67 in year 11. This is well above the upper quartile boundary of $0.90 and is a strength.

Price/Earnings Ratio

The next ratio develops the EPS to show what the market value is relative to each dollar of EPS. It is found by dividing the market price of a share of common stock by the EPS. A higher number is better. The result for this period was $5.48. For year 11, it was $5.21. It has gone up but the total still places in the bottom quartile below $5.50, making it a weakness.

Book Value per Share of Common Stock

This ratio is a measure of stockholders equity from the balance sheet. It is found by taking total stockholder equity (minus preferred equity, if there were any) and dividing by the number of shares of common stock outstanding. A higher value is better again. The value for year 12 is $5.89. For year 11 it was $4.25. Compared to the industry quartiles it is above the median of $5.50 and below the upper quartile of $6.00. This is no concern.

Elasticity of Demand


Element A

Elasticity of demand is a gauge of how sensitive buyers will be to a price change of a product. This is measured using a formula. This formula is the percentage change in quantity demanded divided by the percentage change in price. Using percentages to compute the equation is called the midpoint formula and it allows one set of results to be applicable to both positive and negative changes when figuring elasticity of demand. The result is converted to an absolute value, which is the coefficient of demand. This coefficient determines if demand is elastic, inelastic or unit elastic.

The demarcation of elasticity in the demand coefficient is one. If the number is one then demand is unit elastic. This means that any change in price is offset to an equal degree by an opposite change in demand. Thus, total revenue would stay the same despite the changes. Specific instances of unitary elasticity are hard to find in the real world but a close example could be cars that retain a core of brand loyalty among consumers allowing the brand to retain sufficient numbers after a price increase to maintain revenue.

A demand coefficient less than one indicates that demand is inelastic.  This means that price changes would not have a great effect on demand. If prices go up, total revenue will go up as well. If prices go down, so will revenue. An example of this is liquor sales. Consumers develop loyalty to specific brands and varieties so they will follow them through price fluctuations.

Products with a demand coefficient greater than one are elastic. Generic products that are easily substitutable typify elastic demand. Price and revenue move in opposite directions. If prices go up, revenue goes down because consumers can easily find a comparable product elsewhere. An example of this is restaurants. If one restaurant starts charging more than other comparable establishments, consumers will go elsewhere to eat out. The reverse is also true, if prices go down, then total revenue will go up (McConnell, Brue, & Flynn, 2012).

Element B

Cross elasticity of demand seeks to compare products to one another to determine if the two products are substitutable or complementary. Substitutable products can easily replace one another and are indicative of elasticity. Complementary products naturally go together, that is to say, if one product is purchased, then the other will most likely be purchased as well.

The equation used to determine cross elasticity is as follows: the percentage change in quantity demanded of product X is divided by the percentage change in the price of product Y to arrive at the coefficient of cross elasticity. This number is either a positive or a negative number. This is critical as zero is the threshold of cross elasticity. A result of zero means the two items in questions are unrelated and do not influence each other.

If the number is negative, or less than zero, then the two items are complementary, meaning that the two are usually purchased together. Therefore, price fluctuations of one are reflected in sales of the other. An example of this would be charcoal and lighter fluid.

When the equation results in a positive number, or greater than zero, then the two products are substitute goods. This means that the two products are closely related so a change in the price of one will influence sales of the other. Specific brands of breakfast cereal are good examples of this. If the price of say, Wheaties, increases, consumers will opt for a similar cereal like Corn Flakes, because it is now cheaper (McConnell, Brue, & Flynn, 2012).

Element C

Another factor that influences demand is the income elasticity of demand. This concept explains how consumers buying decisions are influenced by changes in their income. This is revealed through another coefficient arrived at by dividing the percentage change in the amount demanded of a good by the percentage change in the income of the consumer. Again, the threshold for this equation is zero.

If the result is negative, the good is defined as inferior and demand will go down as incomes rise. An example of this is mass transit tickets.

Conversely, if the result is positive the good is called normal or superior, and demand will increase as incomes increase. Most goods fall into this category but a good example would be smartphones and the accompanying service plans (McConnell, Brue, & Flynn, 2012).

Element D

As a rule, price elasticity of demand is easy to see by how many substitute products exist in a given market. An example of this is fruit juice. A visit to any grocery store will show dozens of different varieties and brands of fruit juice. This makes demand for one particular brand of juice elastic because consumers will be very sensitive to price changes and will readily substitute one brand for another.

Elements E & E1

Price elasticity of demand is also influenced by how large a price is compared to an individual income. Price increases will more greatly affect a buying decision for a high-ticket item than a low one. Consider price increases of five percent for bread and mortgage payments. The increase in the price of bread will probably not change the amount of bread purchased by a household at all. On the other hand, and increase in home prices by five  percent will be much more likely to keep a family renting until the market comes back down, thus not making a purchase at all given the price increase. On the demand side, bread would not be affected while the housing market would stagnate.

Element F

The consumer’s time horizon is another factor to consider in elasticity. Assume that local cable prices have risen 15 percent. In the short-run, if the consumer wants to continue watching TV, then the additional price must be paid. In the long-run, however, consumers may experiment with other forms of programming access, such as the internet, satellite or specific media providers, and ultimately abandon cable altogether. This shows that in this instance, consumer demand is much more elastic in the long-run.

Element G

These two graphs show the demand curve and total revenue of a product. To determine elasticity, the total revenue (TR) test is applied to the demand curve. This test is price multiplied by quantity equals TR. Along the demand curve the TR test shows increasing returns from falling prices up to the quantity of four units. Elasticity is shown by increasing TR with falling prices and more units selling. Unit elasticity is the point where returns from price reduction and sales increase equal each other. Inelasticity shows TR falling from further price reduction and increased sales.  In the demand curve graph, demand is elastic from $80 to $50, unit elastic from $50 to $40, and inelastic from $40 to $0.

In the TR graph, the elastic range is seen as TR increasing to its highest point at four units. From there TR levels off between four and five units, showing the unit elastic range. From there, TR drops off with every additional unit showing that demand is inelastic after five units.



McConnell, C. R., & Brue, S. L., Flynn, S. (2012).  Economics (19th ed., pp. 48-90). McGraw-Hill.