Instructions for week 3

Economics & Business 1

Class
Pramela Nair – pramela.nair@fhrinstitute.sr
Doctoral candidate (Info. Sys. & Tech.)
MBA (Finance) & B. E. (Computer Science)
Chapter 2 Markets
 Instructions for all
students
• Read the case ‘Young Entrepreneurs’.
• The slide that follows has the description of the goals in terms of
needs.
• Students should read the chapter 2, section 2.2, page 36-39,
thoroughly.
• You should be prepared to present the factors for the company
chosen by you in class, as a group.
• Every group must be prepared for all factors.
• Unprepared group will have to face the consequences.
 Young Entrepreneurs
A group of young entrepreneur wants to change the world with their new clothing-line.

They think it is very likely to be a success since they all graduated from a design school.

Their thesis and final project ended up in several media sources. ​

The bank employee that helps them with their business plan, explains them that their insights and thoughts might not
be well received by the consumers on the market. Of course this is a prerequisite to sell the clothes.

The entrepreneurs have to answer the following questions:

- Do our products take a large or small share of the customers total budget?

- Is the buying decision made conscious or unconsciously?

- Are the products we're about to sell easy or not easy to substitute?

- How will sales (quantity) of our product be affected in case income levels of consumers change?

- Are the products we're about to sell sensitive to changing trends, fashion or consumer preferences?

Answers to these questions will give insight in consumer behavior

 Needs
Needs (basic and other) are the basis for consumer preferences
Consumer preferences depend on:
•Demographic factors (gender, age, education, family composition)
•Economic factors (income)
•Sociological factors (sensitivity to fashion / trends)
•Psychological factors (desire to distinguish themselves)
•Season and climate
•Government

Time-pressure assignment: every AW-group gets 1 - minute time to

think of an example for each factor (if possible for the company for
which you have prepared the presentation)