A niche market targets a well-defined and specific market segment. Firms that operate in niche markets will therefore cater for the precise and distinct needs of their customers. Distinctly mass markets, the client base for niche markets is relatively small. Yoshiko Travel Ltd. might be considered to operate in such a market because it tenders a specialised service to its rich Japanese clients who are fans of the English Premier League.
b) Sales (
000) Jan Feb Mar Apr May Jun
30 28 32 35 28 0
3-month moving averages 90 ÷ 3 = $30,000
95 ÷ 3 = $31,1667
95 ÷ 3 = $31,1667
63 ÷ 3 = $21,000
4 marks: Award 1 mark for every correctly worked out set of moving averages.
3 marks: If answers are correct but not expressed in
000 and/or there are minor omissions/errors.
1-2 marks: If there is no working work or / and two or more mistakes are made.
c) See graph
For maximum marks, the axes should be perfectly labelled. Deduct a mark for each error made.
Note: The 3-month moving average could be intrigue as a time-series line.
d) Due to the large variations in sales (with a variance of $35,000 in April and zero sales in June), it is complicated to establish any underlying trend line by using the actual sales figures. The 3-month moving average does smooth out these variations to some extent, however.
During the football season, the range in sales is only $7,000 (from $28,000 to $35,000) and the firm is likely to be capable to manage this. Though, with no sales at the end of the football season Yoshiko Travel Ltd. will need to have plan in place to deal with a lack of cash inflow throughout such times, i.e. sales forecasting can help the firm to improve its monetary management. There are also probable to be some staffing issues during the off-peak football season.