Using Probability Distribution in Research Simulation

RES 341: Using Probability Distribution in Research Simulation

Jourdan Cantiberos

Memo

To: Board of Directors

From: Jourdan Cantiberos

Department: Quality Control

Date: 08/17/2010

Re: Sales Research

This memo is to summarize the Comprehensive Sales Research Report for our Mechanical Watches Division that has been completed. From this research report, I am able to make recommendations on buying machinery.

As stated in our previous meeting, two major issues require immediate attention. First, a significant decrease in sales. Second is the number of mechanical watches rejected by the Swiss Official Chronometer Control (SOCC). Our research was based on the following key questions and quality indicators:

Questions/Indicators to consider:

-How do consumers view our mechanical watches?

-How are consumers responding to current advertising?

-Statistical QC data for the SOCC test

-Quality of mechanical watches vs. other Swiss watches

Objectives:

Formalization of the internal QC process

Reduce SOCC rejection rate to less than 10%

How study was conducted:

500 mechanical watch owners were surveyed via questionnaire rendering the following data:

60 % were in favor of SOCC certification. In addition, of the consumers planning to purchase a new watch, 78% would be willing to pay a premium price for a chronometer. Equal questionnaires were also sent to consumers including dealers and outcomes were favorable. Moreover, 70% stated that he or she intends to purchase a mechanical watch. Based on the data, much of this can be credited to our current advertisements. Consumers are responding well to current ad campaigns therefore, changes in this area are not necessary. The recommendation made to focus on water-resistant capabilities, requiring the purchasing of a deep-water simulation unit, has been deferred.

Our research reveals that of the 37,500 watches to be certified, 25,125 were rejected this year alone. This makes up 60% of total production....