Describe one of your best friends.

 Cue Card-4 

Describe one of your best friends

1. Who is that person?/ Who this person is?

- Amrit

2. How you became friends?

- Met in College 

3. What things you do?

- Go for movies

- Go for vacations 

- Mostly together 

4. Explain why he or she is your best friend?

- Understanding 

- Supportive 

- Helpful 

• My best friend’s name is Amrit.

• She became my friend when I met her in college.

• We are mostly together, going for movies, vacations or needs.

• I think, she is my best friend because she understands me and is supportive and helpful. 

Friendship is not an opportunity but a sweet responsibility. I believe that books and friends should be good and few. I have never had many friends and I would like to talk about my best friend, Amrit. She is a beautiful person inside, out and she has always been with me through the thick and thin of my life. I can never thank her enough for being a pillar of strength for me. Although our friendship of four years has had some dark days but I am sure that though days have had no effects on the bond we share. Together we have made many memories, been there for each other when there was no one else. We have been out to shop, watch movies and plan trips to the hills. I know for sure that she is one person who will never been judgement about me. With her, I do not have to think of what I say. I can be myself and be sure for her constant support and help. I am awestruck at the amount of faith and trust she places in me because I feel that to be trusted is a greater compliment than being loved. She has never failed at illuminating my dark times and has always made me feel that though I am away from home, I have another home and family. I wish and pray that we share this bond for our lives and always stand by each other in hours of need and that God also blesses others with a friend like her. 

Followups:

1. How do people in your country make friends these days? People in my country make friends through social networking sites or other applications like WhatsApp, Instagram etcetera. Some may meet new people in gardens or parks and make friends.

2. Do you trust friends that meet on the internet? I do not feel that making friends on various websites is reliable. I do not trust people who are acquainted through the internet.)

3. How do you get along with people you don’t like? (I stay neutral towards people who I don't like. I indulge in limited conversations with them.)

4. Why is it hard to maintain friendships for some people? (Ego and taking friends for granted are the main reasons for the inability of some people to maintain friendship.)

5. Would you only make friends with people who are similar to you? (I generally make friends with people similar to me because it is easier to get along likeminded people.)

6. Do you like to have many friends? (I believe that books and friends should be high on quality and low in quantity. So, I don’t have many friends but the few I have are very good.) 

Related Questions: Childhood friend OR A person you like spending time with. 

An incident where you forgot something important

Cue Card-3 

An incident where you forgot something important. 

1. When was it? 

- 4 years ago

2. What did you forget?

- Admission 

- Younger sister

3. What was the result?

- Seat given to someone else 

4. How did you feel?

- Upset

- Angry

1. I made the mistake of forgetting something four years ago.

2. I forgot to deposit my sister’s admission fee.

3. She was to begin school and her seat was given to someone else.

4. I was upset and angered with myself at the way I had been careless and forgetful.

To err is human. No one is perfect and I too make mistakes. I remember it was 4 years ago when my youngest sister was begin to school that my parents entrusted me with the responsibility of depositing the fees in her school as they had to go out of town due to an unexpected death in the family. I was sure that I would remember and be able to do so but sadly on the day of deposit, I totally forgot. It was in the late afternoon that I realized about the same. I felt so upset and angered with myself that because of my carelessness, my little sister would suffer as this was the best school for girls in my town. However, after a lot of efforts, we were able to secure the seat back for her. Though I had gone several times and so did my parents to speak to the principal and request her but she refused and bluntly said that rules were same for all. Finally, by the grace of God, someone who knew the principal spoke to her and managed to get my sister’s admission done. My parents did not scold me but only told me to learn my lesson. I learnt it the very same day and till today, I make it a point to write or a set a reminder so that I do not commit the same mistake again. 

Followups:

1. What do people do to remember things?

- People normally write the things that they need to remember or use alarms and reminders on their phones. 

2. Why do old people forget things easily?

- Yes, they find it difficult to remember things because growing age makes the memory weak in most people and they are unable to retain most things. 

3. What kind of things can people do to prevent a bad memory?

- In India, people eat almonds but one can also avoid the excessive use of phones or other electronic gadgets to avoid bad memory. 

4. Do you think memory is important while learning a language?

- Undoubtedly, like for all other things, memory is also important to learn a language, if you are a forgetful person other then learning a language will be challenging.

Related Question: An appointment you forgot. 

Describe a method that helps you save money

 Cue Card - 2 

Describe a method that helps you save money.

1. What method?

- Recurring deposit

2. When you started?

- 3 years ago

3. How you knew it?

- My mother told me

- Aunt in neighbourhood 

4. Explain its helpfulness.

- Saves money for emergency 

- Proper rate of interest 

1. I save money in a recurring deposit account in the post office.

2. I started this practice 3 years ago.

3. My aunt in the neighbourhood works in a post office so, my mother suggested this to me.

4. It is very useful as it helps me to save money for tough times and rate of interest is appropriate, so it is like an investment. 

Money is the most desirable commodity and it brings a smile to every face and gleam to every eye. People put in a lot of effort to earn money. And in today’s world, maximum emphasis is laid on money. Tough I am spendthrift and a shopaholic but I have sure that I save some amount of money for bad times. Whenever I get my pocket money, I make a list of few things I need to spend my money on in a particular month and buy them. Every month, I deposit a part of my pocket money in my recurring deposit account at the post office. This idea was given to me by my mother. A lady in our neighborhood who works at the post office completes the monthly deposit procedure for me. The rate of interest is also good and I have been following this for about three to four years. When my deposit matures, I re-deposit the entire amount and continue the cycle. In this way, I have been able to save a substantial amount of money. And I feel one should be encouraged to save from childhood because tough financial times are unpredictable. To conclude, I would say that for financial security money should be spent wisely and saved generously.

Follow ups:

1. What can parents do to teach children to save money? (Parents can buy children piggy banks to encourage them to form a habit of saving money.)

2. Why do young people tend to waste money? (Akk Young people are not wise or experienced enough to spend money judiciously. So they spend extra money on unnecessary things.)

3. What kinds of things people like to buy in your country? (People in India like to buy a wide variety of things. Women generally spend money to buy clothes and jewellery. Men may like to buy vehicles and children prefer toys.)

4. Do schools in India teach anything about financial management? (I do not think so because as far as I know, no school in India has generic lessons on financial management. Such lessons are restricted to students who choose to study commerce after 10th grade.) 

5. Why is it necessay to teach teenagers to manage money? (It is necessary to teach money management to teenagers because if they are not taught at this age, they may find it difficult to manage their finances later in their life.)

6. How do parents give pocket money in your country? (It varies from family to family. Some parents prefer giving a weekly or montly pocket money to their children, while others give it as and when needed.)

A news reporter you would like to meet.

 Cue Card - 1

A news reporter you would like to meet.

1. Who is it?

- Barkha Dutt

2. How do you know him/her?

- Columnist in Hindustan Times 

- TV show  We the people

- News anchor

3. Why do you like him/her?

- Confident 

- Graceful, elegant

- Well-educated 

India has had many great people from time to time. There are a few personalities who leave indelible footprints in our hearts and they influence us in several ways. The person I truly admire and appreciate is Barkha Dutt who is an Indian television journalist and columnist. I have read several articles written by her in the widely read newspaper, Hindistan Times. She is the host of my favourite TV serial and award-winning, weekly serial ‘We The People’ as well as the daily prime time show, ‘The Buck Stops Here’. She emerged as a prominent figure post her reporting of the Kargil war in 1999. She has to her credit books named the Uniquet Land, Gujrat: The making of a tragedy. She is also the recipient of the Padma Shri for her excellent work. I am inspired by her confidence, elegance and grace. She is a woman par excellence who is an inspiration to many others especially me. Her strong and charismatic disposition makes all her viewers get impressed. All in all, she is a woman who I respect and admire in all respects and would surely want to meet one day. 

Follow ups:

1. What type of people can be seen on TV?

- All kinds of people whether politicians, doctors, priests, astrologers or dieticians can be seen on TV. 

2. Do you think there is too much news about celebrities? 

- Yes, I feel celebrities are excessively flashed on news channels so much so that they lose their privacy. 

3. Do you think negative information shown in the news can have a negative influence on people?

- Definitely, I think that there is major negative influence on people by showing such things on television like crime being committed, or fear of terror attacks, etcetera.

Related Questions:

- Favourite personality 

- Favourite person on television 

- A person you admire

Cost Accounting: fundamental principles and functions

 Q. Define cost accounting. Explain the fundamental principles and functions of cost accounting.

VK

Ans. Meaning of Cost Accounting: Cost Accounting refers to the process of accounting for costs incurred in manufacturing, trading or services rendering types of businesses. Hence, cost accounting is the most systematic and scientific branch of accounting that deals with identification, analysis, recording, summarizing and communication of current and prespective cost. 

Cost Accounting is a branch of accounting which deals with accumulation (collection), classification, recording, analysis, interpretation, reporting and control of current and prospective costs. It explains the cost of production of a product or a service according to its components per unit as well as total. Cost accounting is a specialised branch of accounting which involves classification, accumulation, analysis, assignment and control of cost. The rules and principles of cost accounting have developed over a period of time by experience. The cost accounting need arouse because of the limitation of financial accounting.

Cost Accounting is the classifying, recording and appropriate allocation of expenditure for the determination of the costs of products and services and for the presentation of suitably arranged data for the purpose of control and guidance of management. It includes the calculation of cost of every product, job, section, department, process, service. It is the method of accounting for cost. 

Fundamental Principles of Cost Accounting: The following are the main principles of cost accounting:

1. A Cost should be related to its cause: A cost should be related as closely as possible to its cause for recovering the cost of product, job, process or cost centre. The effect of cost of an item on the various products, departments or processes should be established before it is charged to that product or cost centre. The cost are collected and analysed according to their nature and are to be allocated or apportioned on the basis of cause relationship. For example, rent of the factory building should be charged from all the production departments on the basis of the area occupied by each production department. 

2. A Cost should be Charged only after its Incurrence: While calculating the cost of individual units those costs which have been incurred (actually or nationally) should be taken into account. As for example selling overheads should be charged only to those units which have been sold and all those units which are still in stock should not be charged with selling overheads. Similarly normal loss should be only absorbed by those units in which it has taken place and not in those units which are yet to be produced.

3. Abnormal Cost should be Excluded from Costing: A loss due to accident, fire, theft, riots, negligence is the abnormal loss. Abnormal losses should not be charged to the production cost as these are not related to production. The inclusion of abnormal loss in the cost of production would distort cost figures ans mislead the management as to the working results of the undertaking. For this reason only normal cost incidental to production is charged to product, job or cost centre and not the abnormal losses or abnormal cost. This is the reason abnormal losses are transferred to costing profit and loss account. 

4. Past Costs are not charged to Future Periods: A past cost means a cost from which no more benefit is to accrue. A cost item which was incurred in the year 2015 is not to be charged from the cost of production from the product of the year 2016. It will unnecessary distort the cost of production and it may lead to wrong decision by the management regarding the product, cost centre or efficiency of the department. But if there is an item of expenditure in the past, the benefit of which will accure in the future, then it should be charged in future period as a deffered revenue expenditure as for example expenditure on advertisement. The items of past cost if remain uncharged from the product of that period then it should be transferred to costing profit and loss account with a note stating reason. 

5. The concept of Conservatism has no place in Cost Accounting: Cost accounts should be prepared with facts without any biasness or with a secret purpose. The closing stock is valued at cost price or market price, whichever is less in financial accounts while in cost accounts stock is valued at cost only. There is no creation of secret reserve in cost accounts as in the case of financial accounts. If principle of conservation is asopted in cost accounting then the cost of production will not be comparable and purposeful. 

6. Principle of Double Entry should not be Applied in Cost Accounting: The cost ledgers and other cost control accounts are kept on double entry principles. Costing, however requires a greater use of cost sheets and cost statements for the purpose of cost ascertainment, cost control and reporting to management.

Functions/Objectives of Cost Accounting: The main objectives of cost accounting may be:

1. To Ascertain Cost: With the help of cost accounting cost per unit of a product, job or process is calculated. For calculating cost of the product or service various methods like unit costing, contract costing, job costing etc. are applied. The technique of ascertaining the cost is known as costing. 

2. Cost Control: Cost Control is reducing the cost of production by controlling the wastage of material, labour and other expenses. Cost control helps to improve the efficiency of organisation as a whole. For cost control bugetary control, standard costing and responsibility accounting are the main tools applied by the management.

3. Determination of Selling Price: Cost accounting has the main object to help in fixation of selling price of the product or service not only in normal condition but also under various stressing market conditions. To fix the selling price various factors like cost of production, market situation, business cycle, govt. policies, competition, change in fashion, income level of the people do play their role. Cost accounts helps to provide necessary information to take decisions under conditions like depression, export, or exploring the new market etc. Minimum selling price can be decided with the availability of proper cost data.

4. Ascertainment of Profitability: Profitability means capacity to earn profits of a department, section, product, job or a process or service. This capacity can be judged with the help of cost data provided by cost accounting. The expected profits are compared with the actual profits to know the reasons of difference, if any. This helps to analyse the efficiency of each segment of the organisation as well as the whole of the organisation. Before introduction of a new product, design, method, machine or operating Market profitability analysis helps to set targets and performance measurement. Thus, the object of cost accounting is to measure the profitability of the activities carried out or planned. Profit making capacity should be established.

5. Provides a base for setting business policies: Cost accounting helps to provide accurate cost information. These cost data help the management in taking short-term and long-term business policies to be followed. Cost accounts help in various decision making processes which may be very crucial to the organisation like: 

(a) To introduce new product or new method of production or to explore a new market.

(b) How to use idle capacity if there remains any?

(c) Deciding the sales mix to maximise the profits or to maximise the use of available factors of production.

(d) Make or buy decision regarding a product 

(e) Exporting goods in a foreign market even at below the cost of production or not.

(f) Closing down the plant or to contribute production even in losses.

(g) Replacement of old machinery with the new model or not. 

6. Inter-firm Comparison: Cost accounting helps in making comparisons of cost or of profits of one firm with other firm operating in the same industry. For the inter-firm comparison there should be the application of uniform costing system within that industry. 

7. Control on Wastage: Cost accounting can explain the source of wastage in the statement of cost (i.e. material, labour and other expenses) and thus can save the national factors of production.

8. Minimum Capital in Stocks: Cost accounting through various techniques like various levels of stock, analysis of slow moving material, continuous stock taking can decide the objective to minimise the investment of capital in stocks of raw material, work-in-progress or finished goods.

9. Effective Information System: The objective of cost accounting is to prepare regular reports regarding material, labour and other expenses and to communicate those reports at the effective level of management to make them effective. 

10. Internal Audit System: The objective of cost accounting is to develop internal audit system which may help in effective working of different departments of the organisation.

SBP

Ans. MEANING OF COST ACCOUNTING: Cost Accounting is a specialised branch of general accounting in which detailed and systematic information related to cost of goods and services are maintained in such a way as to obtain detailed information about total and per unit cost and guidance for the analysis and control of cost.

Add definition here.

Conclusively, cost accounting may be defined as the body of concepts, methods, techniques and procedures used to compute, analyse or estimate the costs, profitability and performance of individual products, services or departments and other segments of an enterprise.

FUNDAMENTAL PRINCIPLES OF COSTING

The fundamental principles of costing are as follows:

1. Cost is related to its cause. A cost is related as closely as possible to its cause. Rent of the factory, for instance cannot be charged to office expenses, repairing charges of a machine cannot be charged to some other machine, and in the same way, a foreman's salary cannot be charged to one single unit, if many more units are produced in a department supervised by that foreman. The reason in all the above cases is that the cost is related to its cause.

2. Cost is charged after it is incurred. If a cost is not incurred either actually or notionally, it cannot be charged to a cost centre. For instance, a cost unit is not charged with selling costs while it is still under manufacture in the factory, as selling costs would occur only when the cost unit is finished in the factory and is sold. Similarly, normal loss or wastage is to be borne by the units of which it is a loss or wastage. Such a loss is not imposed on those units which are yet to pass the point of loss.

3. Abnormal costs are excluded from costing. A cost to meet the loss caused by'fire, riot, theft or accident is an abnormal cost. This cost is not charged to production as it is not related to production part. The presence of abnormal cost in costing would only distort cost figures and mislead the management for the purposes of cost control and decision-making. Similarly such financial expenses as have little or no relationship with costing, are also considered abnormal and are not charged to costing.

4. Past costs are not charged to future periods. A past cost is one from which no more benefit is to accrue. If, however, a past cost is such the benefit of which is to accrue in a future period also, as for instance, advertisement expense being treated as deferred revenue expenditure, then it is not a past cost and it can be charged during the period of benefit.

5. The concept of conservatism has no place in costing. The closing stock in financial accounting is valued at cost price or the market price, whichever is less, but in costing, the closing inventory and stocks are valued at cost only. There is a value attached to the concept of conservatism in financial accounting but it is not so in costing. Cost statements are required to be prepared so as to state facts with no known bias. If, however, a contingency is to be taken into consideration in cost accounting, it should be so stated and shown distinctly.

6. Accounting for cost is based on Double-entry Principle. The Cost ledgers and other cost control accounts are kept on the double-entry principle-the same principle which is adopted so exhaustively in financial accounting. Costing, however, requires a greater use of cost-sheets and cost statements for the purpose of cost ascertainment, cost control and guidance to management.

FUNCTIONS OR OBJECTS OF COST ACCOUNTING

The main functions or objects of cost accounting are as follows :

1. Cost ascertainment. The primary objective of cost accounting is to determine the cost of production of every unit, job, operation, process, department or service. The technique of ascertaining cost is known as 'Costing. In order to determine cost, all the expenses are accumulated, classified and analysed. It not only determines the cost at completion stage but also determines cost at various stages of production.

2. Cost control. Cost control is one of the important functions of cost accounting. To measure the efficiency of the organisation or of the cost centres, the various operations involved in the manufacture of products are to be carefully studied. Budgets and standards for the consumption of materials, use of labour, and for expending the overhead are to be set and compared with the actual performances. The variances arising out of the comparison so made tell the tale whether the cost is within control or not.

3. Cost reduction: Cost reduction refers to real or genuine savings through permanent reduction in cost of a product or service without impairing the quality and affecting its purpose for which it was intended to be used. In the competitive market situations, it is utmost important for the organisations to look for activities and search for new technology through research and development activities that can reduce the cost of a product. Cost reduction can be attainable in almost all the areas of business activities. The area covered for cost reduction are like product design, plant layout, production methods, material substitution, reduction in wastages, innovation marketing strategies, purchasing and material control etc.

4. Ascertainment of profitability: It is the object of cost accounting to ascertain the profit making capacity of that activity planned or being carried out and to compare the actual profits made with their profitabilities. Difference is analysed and efforts are made to earn the maximum profit as per capacity.

 

5. Determination of selling price: The supply price or the tender price of a product depends upon its total cost plus a margin of profit which the businessman wants to make depending upon the inter-play of factors of demand and supply. Cost accounting provides detailed information about the composition of total cost for the determination of the selling price. It also provides information to decide the extent to which the prices can be reduced to meet the challenge arising out of competition, by differentiating the costs into variable and fixed cost. Similarly, in the event of depression or recession, the cost accountant can guide as to which expenses can be curtailed, to reduce the cost of production and thus to decide the minimum selling price.

6. Providing a basis for business policy and decision-making. The objective of cost. account- ing is to help the management in the formulation of business policy and in decision-making. The gross-profit analysis, the cost-volume-profit relationship, the break-even point of sales, and the differential costing method, etc., help the management in profit-planning and in deciding crucial matters like (a) introduction or discontinuance of a product; (b) utilization of idle plant capacity; (c) selection of most profitable sales-mix; (d) dumping of goods in a foreign market at a cheaper price; (e) make or buy; (f) purchase of new plant or continuance with the old plant at the cost of heavy repairs, etc.

7. Compliance to statutory requirements: The Central Government, under Section 209(1) (d) of the Companies Act, has made it compulsory for 47 industries to maintain cost accounts. Thus, compliance to statutory requirements is also one of the objectives of cost accounting.

Define cost accounting. Explain the fundamental principles and functions of cost accounting.

Advantages and Disadvantages of Foreign Direct Investment

 Q. Describe in detail the advantages and disadvantages of Foreign Direct Investment.

Ans. In simple words, it is the investment other than the domestic investment. It is made by foreigners. In Foreign Direct Investment, the control of the company is in foreign hands. For example, if a company in USA directly invests money in an Indian company and keeps the control in its own hands in form of majority stake, this is said to be Foreign Direct Investment. Foreign Direct Investment means injection of the funds into an enterprise by a company having its origin and operation in a different country. Therefore, as a result of Foreign Direct Investment, the investors invests funds in the company directly and as a result of this ownership, the owner is granted management rights. Also the investor gets voting rights. Generally, Foreign Direct Investment refers to the Investment of foreign assets into domestic goods and services.

ADVANTAGES OF FOREIGN DIRECT INVESTMENT: Following are the major advantages of Foreign Direct Investment in the host country:

1. Inflow of funds: Foreign Direct Investment causes inflow of the funds into the host country. These funds are generally in form of foreign exchange. Therefore FDI helps in bringing foreign exchange to the host country. Due to this reason vious countries are opening up their economies and relaxing FDI norms.

2. High technology: Foreign Direct Investment helps in bringing latest technology to the host country. The companies that establish their operations in different countries are usually very big in size and therefore are very high tech.

3. New markets and marketing channels: Foreign Direct Investment brings in dual benefits of exploring new markets to the parent company and also gives new markets and the marketing channels to the host country company

4. Employment generation: As a result of Foreign Direct Investment, a lot of employment is generated in the host country. The companies usually employ a lot of skilled as well as unskilled labours,

5 Capital formation: As the company bringing in Foreign Direct Investment invests its money in the assets, goods and services of the host.country, a lot of capital is generated and therefore the process of capital formation is accelerated.

6. Increased tax revenues: The government of the host country is also benefitted because the company establishing its business operations in the host country pays taxes on the income earned in such country to the government of that country. Therefore these companies are a source of government revenues.

7. High quality products: Generally as a result of Foreign Direct Investment there is an increase in the competition in the host country. As a result of this increased competition, the high quality products are ensured.

8. Cheap prices: Due to the use of latest technology and the economies of scale, the goods are offered at cheap prices to the customers. Therefore, the customers are benefitted.

DISADVANTAGES OF FOREIGN DIRECT INVESTMENT: Following are the major disadvantages of Foreign Direct Investment:

1. Foreign Control: As a result of Foreign Direct Investment, the control and the management are vested in the foreign hands. As a result of this the domestic company becomes a puppet in the hands of the foreign country. 

2. Harmful to domestic industry: The foreign countries bring in the latest technology in the host country. Also due to large scale operations, the big companies enjoy economies of scale and hence sell goods at cheap prices. The domestic industry cannot fight the tough competition that these big companies give to them.

3. Outside management and control: As a result of Foreign Direct Investment, the management and the control are vested in foreign hands. Therefore, all the decisions are taken by the foreigners. There is a dilution of control of the host country. 

4. Repatriation of profits: The company that establishes its business in the hist country repatriate a part of its profit to the host country. As a result, there is an outflow of funds from the host country. 

5. Dilution of Control: Foreign Direct Investment results in dilution of control. As a result of FDI, the control of the companies goes from host country to the foreigners.

Describe in detail the advantages and disadvantages of Foreign Direct Investment.

Scope of Modern Marketing Research

 Q. Discuss in detail the scope of modern marketing research.

Ans. Marketing research is more comprehensive, it covers all marketing functions relating to product, price, promotion and distribution. Marketing policies, programmes and strategies are guided by it. There is hardly any area in marketing where research is not possible or needed. The area of marketing research can be classified as: 

I. Problem Identification Research: It helps to identify problems that are exist or are likely to arise in the future. This type of research provides information about the marketing environment and helps to diagnose a problem. Problem identification research covers the following areas:

(i) Market Share Research

(ii) Market Potential Research

(iii) Market Features Research

(iv) Market Image Research

(v) Sales Analysis Research

(vi) Business Trend Research

II. Problem Solving Research: Once a problem is identified, problem solving research is undertaken to arrive at some solution. The findings of problem solving research are used in making decisions that will solve specific marketing problems. Problem solving research covers the following areas:

(i) Product Research

(ii) Pricing Research

(iii) Promotion Research

(iv) Segmentation Research

(v) Distribution Research

Marketing Research can be applied in almost every aspect of marketing. A wide range of marketing activities are covered by the marketing research. The scope of marketing research is very wider but it may be summarised in following manner: 

1. CONSUMER RESEARCH: Consumer Research is concerned with the studies of consumer behaviour. It probes into different factors such as economic, sociological and psychological that influence the consumers in their decision to buy the product. Generally, consumer research is in the form of attitude studies which offer clues in distinguishing the appeals of competitive brands to certain type of customers.

Consumer research can also provide consumer suggestions when they feel certain deficiency or when they would like to have some improvement in the product or service.

Consumer research may be undertaken not only at macro level but also at different segment level. Consumer research generally covers the following areas:

(i) To know the demographic features of both present and potential consumers.

(ii) To identify the needs and expectation level of consumers regarding product or service.

(iii) To know the buying motives and buying habits of the consumers.

(iv) To determine the level of consumer satisfaction.

2. MARKET RESEARCH: Market research is the study of markets with regard to certain products of a company. The market research involves analysis of market potential for existing products and estimating demand for new products, sales forecasting, characteristics of product markets, analysis of sales potentials and studies of market trends. 

Market Research develops market and sales potentials and sales quotas by determining how much of a commodity in a given market is expected to be sold. It helps in determining the sales territories of salesmen, distributors and dealers.

Market Research involves investigation of various elements of consumer demand, such as total demand, relative demand and replacement demand. Market research provides answer to the question, 'who may buy and who is buying the product. 

Market Research collect the information on following aspects:

(i) Forecasting of sales and demand

(i) Nature and extent of competitive forces

() Geographical location of markets.

(iv) Strength's and weaknesses of the firm and the competitors

(v) Assessment of government policies on the marketing efforts of the firm.

3. PRODUCT RESEARCH: Product Research refers to the efforts made to have knowledge about new and existing product, to meet the specific requirements of consumers regarding quality, design, shape, size, style, durability, purity, packaging, branding, etc. It aims at finding out new product or combination of products. On the basis of product and packaging research, a business firm can develop suitable market segment strategies. It may also emphasized that the product research is concerned with every stage of product life cycle viz. introduction, growth, maturity and decline. 

The major area of product research are: 

(i) Evaluating the product performance of the firm in terms of turnover, profits, market segments and competition.

(ii) Market testing for new products of the firm.

(iii) Research on consumer acceptance of firm’s products and services as compared to similar products of competitors.

(iv) Research on development of new products.

(v) Evaluation of new competitive products.

(vi) Appraisal of product diversification and simplification plans.

(vii) Determining product modifications on the basis of their quality, design, varieties, colours and appearance, etc.

(viii) Research on causes and extent of consumer dissatisfaction with firm’s products when sales are rapidly declining.

4. SALES RESEARCH: Sales Research covers the problems relating to the sales of products of the firm. It examine various sales outlets or sales territories to find out sales potentials to improve the existing level. Such a research can be product wise in addition to the overall performance. Sales research helps in determining the effectiveness of the sales force and identifying specific factors that may improve its performance. Sales research can be used:

(i) For measuring sales performance in terms of volume and profits.

(ii) For determining and revising sales territories and sales quotas.

(iii) For assessing firm’s position in the market in relation to its main competitors.

(iv) For analysing and appraising the sales methods and sales force performance.

(v) For finding out ways and efforts by which sales opportunities can be exploited successfully.

5. PRICING RESEARCH: Pricing Research examine all the questions relating to the consumer’s ability to pay for the products and services. It examine the policies relating to prices, discounts and allowances.

The areas of pricing research are:

(i) Testing of alternative price strategies.

(ii) Studying the price policies and strategies of the competitors.

(iii) Determining the suitable price policy for a product.

(iv) Determining price expectation of the consumers in different market areas or segments.

(v) Measuring the consumers reactions and responses to firm’s product prices.

6. PROMOTION RESEARCH: Promotion Researches are conducted to know past trends, present performance and future plans in connection with the promotional policies of the company and its competitors. The research on promotional policies includes advertising research, analysing advertising and selling practices, selection of advertising media, designing advertising copy and testing advertising message, determining sales territories, evaluating present and proposed sales methods, evaluating promotional tools viz., premiums, price-offs, contests, trade shows, exhibitions, etc. 

Promotion research is getting more importance because huge amount is spent by al fe companies on advertising, publicity, personal selling and sales promotion activities. Following are the important areas of promotional research:

(i) Measuring effectiveness of alternative advertising copies designed.

(ii) Media research ie., studying alternative media television, radio, newspapers and magazines, etc.

(iii) Evaluating and selecting the media mix.

(iv) Determining the advertising messages and appeals in the light of research findings.

(v) Identifying the consumer motives, attitudes and emotions to find out the ways and means of motivating the people to increase the sales.

7. DISTRIBUTION RESEARCH: Distribution Research has two major areas namely, channel research and physical distribution research. Channel research is concerned with the problems of middlemen and their solution. Physical distribution research is concerned with the problems of and solutions to storing. transporting and handling of products. Distribution research is concerned with designing of distribution channels, handling and packaging of merchandise, location of warehouses, transportation, inventory control, material handling, etc.

The areas of distribution research are:

(i) Studying the existing and potential channels with evaluation of channel performance.

(ii) Determining optimum inventory levels and storage facilities.

(iii) Making cost analysis of various elements of distribution mix like, warehousing, transporting, inventory control and material handling, etc.

(iv) Determining dealers needs and behavioural factors.

8. POLICY RESEARCH: Policy Research is concerned with the study of the policies in all the areas of an organisation and their post-operative effects on marketing. Marketing as a specialised activity is going to be a grand success if other specialised activities contribute to it. The areas of policy research are:

(i) Studying the existing policies and strategies in production, finance, personnel, etc.

(ii) Determining the best policies to better the results with reduced efforts and investments.

(iii) Studying the marketing policies adopted by the competitors.

(iv) Evaluating the impact of change in firm’s policies on marketing efforts.

9. CORPORATE RESEARCH: Corporate Research is gaining importance because of increasing consumer awareness. Corporate research is conducted on anti-pollution devices, consumerism, attitude of consumers towards package designs and promotional strategies, etc. A company might be interested to see whether the consumers are unintentionally harmed by the company by adding to the pollution of environment, adding to the social costs, excessive expenditure on packaging and promotion, not allowing consumers to know about the product quality and manufacturing, etc. Corporate research covers the following areas:

(i) Studying the awareness among consumers regarding product quality and manufacturing methods.

(ii) Evaluating attitudes of consumers to package designs and promotional strategies, company’s addition to social costs, etc.

(iii) Studying the impact of business on the environment and cost of using anti-pollution devices.

10. MOTIVATION RESEARCH: Motivation Research is qualitative research, that answers, why do people buy or do not buy a particular product. It also studies impact of motives, attitudes and ability to pay on consumer purchase decisions. The areas of motivation research are:

(i) Knowing the consumer reactions in terms of consumer expectations and aspirations.

(ii) Finding out the ways and means which motivate the consumers to buy company’s products or services.

(iii) Identifying the consumer motives, attitudes, emotions and other hidden reasons which influence the buying decisions.

(iv) Knowing the consumer likes and dislikes about the product or service.

From the above description it is clear that the scope of marketing research is very wide. It spans over the marketing activities in the areas of consumer, product, market, sales, pricing, promotion, distribution, business policies, advertising, motivation, etc. In addition to the above broad areas, there are many other areas of marketing research which are also equally important. However, The actual scope of marketing research is determined by the specific needs of the firm.

 Scope of Modern marketing Research