1/8/14

Summary
First, we covered the rest of chapter 3.  Which included the section on cost of good sold (cogs).  We also looked into the economies of scale of one unit. The lead to us discussing all the components that went into calculating the price for one unit to be manufactured and sold.  The sales-cogs=gross profit.

In chapter 4 we looked at our markets.  A market is who you are looking to sell your product or service to.  We learned the different ways to conduct market research: primary and secondary.  We saw that the primary research methods were more hands on and research you carried out on your own.  The secodnary research is about gathering information from sources that have conducted research before you and drawing your own conclusions from that research.  After that we watched another episode of Shark Tank.

Reflection
Through the Shark Tank episodes I can see where the cogs is one of the major factors in a business.  Mango Mango Mango's COGS was too high compared to what they were selling it for, and that is why the sharks did not want to invest.  The same goes to the guy with the magnetic Christmas lights, while he had a good idea the lights just cost too much to make.  I also saw how market research plays an important part as well.  The guy with the Christmas lights had trouble answering how many houses had metal vs aluminum rooftops.  While the the Hanuka/Christmas ornament guy had done his research.  However, even though he had done the research did not make the sharks want to buy the product.  They felt the product would not sell well.  I would agree with this, most Christmas top ornaments are a one time buy, and with it being only a seasonal product to a niche market of only half a million households makes it much more difficult for the product to be successful..  

Looking at my own online casino.  My target market would be Iowa residents between the ages of 21-60.  Doing research I found according to the American Gaming Association that American bettors are expected to place at least $8 Billion in wagers the upcoming year.  Doing further research I found that there is expected to be 14 billion in bets on online, this is across the world however.