2.1 Create information for decision making by summarizing data using representative values

The questionnaire set out to seek for information from people on their view of Starbucks product. It sought to find out about people’s

perception of Starbucks product. That is ‘why they tend to purchase it’. 40 persons were interviewed with a structured question. The

information obtained are thus shown below. The representative values used here are the mean, median, mode and standard deviation.

Table 1 showing the mean, median, mode, Standard Deviation for each questionnaire response

Table 1. Statistics

Income

Level

What kind

of

Starbucks

product do

you use?

Why do you

buy Starbucks

product

How did you

get to know

about

Starbucks?

How do you

judge Starbucks

Product?

Do you prefer

products of other

company’s apart

from Starbucks even

though Starbucks?

Will you introduce

Starbucks product

to everyone?

NValid 40 40 40 40 40 40 40

Missing 0 0 0 0 0 0 0

Mean 2.65 1.38 1.88 1.25 1.53 1.70 1.33

Median 2.00 1.00 2.00 1.00 2.00 2.00 1.00

Mode 2 1 1a 1 2 2 1

Std. Deviation .802 .628 .791 .543 .506 .464 .730

Variance .644 .394 .625 .295 .256 .215 .533

Percentiles

25 2.00 1.00 1.00 1.00 1.00 1.00 1.00

50 2.00 1.00 2.00 1.00 2.00 2.00 1.00

75 3.00 2.00 2.75 1.00 2.00 2.00 1.00

a. Multiple modes exist. The smallest value is shown

Source: Authors Construct. 2015

Table 2. Responses from Questionnaires

Personal Details Frequency Percentage

Age

Up to 18 6 15.0

18-30 years 14 35.0

31-50 years 20 50.0

Total 40 100.0

Sex

Male 14 35.0

Female 26 65.0

Total 40 100.0

Student

Occupation Teachers

Bankers

Sales Attendant

Total

16

11

10

3

40

40.0

27.5

25.0

7.5

100.0

Primary 1 2.5

Level of Senior High

Education Undergrad

Postgraduate

Total

13

15

11

40

32.5

37.5

27.5

100.0

Average 10000-20000

Income 20001-30000

300001-40000

Total

22

10

8

40

55.0

25.0

20.0

100.0

Source: Authors Construct. 2015

Table 2. Shows the number of respondent who answered each questionnaire and these two tables

therefore give a representative values of the questionnaire.

Analyzing table 2., it can be realized that of the 40 respondent who answered the questionnaire,

15 percent were 18 years and below. 35 percent were between the age range 18-30 years and 50

percent were between the ages of 31-50 years. Accordingly there were more female than male.

Thus 14 were male and 26 were female. Moreover 40 percent were students, 27.5 percent were

teachers, 25 percent were Bankers and the remaining 7.5 were sales attendants. These were the

occupations of the respondents.

Additionally, the average income of the respondents were also analyzed and it came to light that

55.0 percent indicated that their average incomes is between 10000 and 20000 per annum.

Accordingly 25 percent indicated their average income is between 20001 and 30000. 20 percent

also said their average income was between 300001 and 40000

2.2 Analyse the results to draw valid conclusions in a business context

This section explains the table 1 which relates to the statistics obtained. The mean, median and

mode are thus explained.

From table 1. and considering the questionnaire that relates to the kind of Starbucks product they do

use, it showed a mean of 1.38, median of 1 and mode of 1.

The mean of 1,38 means that on the average respondents tend to use more of the coffee product of

Starbucks than any other product.

The mean sometimes is affected by outliers. These extreme cases therefore misrepresent the data been

analyzed. The medium therefore becomes a good measure. In this data, the median is 1 and this means

that 50% (that is half) of the respondents indicated they do use coffee products than any other

products of Starbucks

The mode is the most frequently occurring digit. The mode in this case is the 1. That is means

that customers of Starbucks product use the Coffee products more frequently than any of the

other products.

Additionally, if we consider the questionnaire that relates to the income level of respondents, it

showed a mean of 2.65, median of 2 and mode of 2.

The mean of 2.65 which means that the average income of respondents is between the income brackets of

200001 and 30000.

The median is 2 which is the middle number in the sequence of numbers and it’s used to inform capacity

planning. Here the middle income level of the respondent is 10000-20000

The mode in also 2 which means that the most frequently occurring income level of respondent is

between 10000 and 20000.

2.3 Analyse data using measures of dispersion to inform a given business scenario

Measures of dispersion refers to how spread out a set of data is. And the most commonly used

ones are the variance, standard deviation and percentiles.

From table 1 and considering the question that relates to ‘how do you judge Starbucks product?’

Standard deviation and the variance are 0.506 and 0.256 respectively. Accordingly, the 25 th, 50th,

and the 75th percentiles are 1.00, 2.00, and 2.00 respectively.

The standard deviation which is 0.506 shows how spread out responses vary or deviate from

the mean. Since the mean is 1.53 for this question, then the deviation of responses from the mean

is two times. It is thus said that if observations vary greatly from the mean, the standard

deviation is big; and vice versa. In this case the standard deviation does not vary greatly from the

mean as such responses are not widely spread out.

The variance is 0.256 which also indicates how spread the responses are. It is the square root of

the standard deviation.

Percentiles are also good measures of dispersion. The 25th percentile is 1.00 which indicates

that consumers do judge or consider Starbucks product as very good. Accordingly the 50 th and

the 75th percentiles are all 2.00 which indicates that consumers judge or consider Starbucks

product as ‘Good’. This is also depicted in the table 3.

Table 3. How do you judge Starbucks Product?

Frequency Percent

Very Good

19 47.5

Good 21 52.5

Total 40 100.0Source: Authors Construct. 2015

From table 3 it could be seen that when respondents are asked to judge Starbucks product, 47.5

percent indicated that Starbucks product are very good and 52.5 percent indicated that their

products are good. None of them said Starbucks product are bad.

2.4 Explain how quartiles, percentiles and the correlation coefficient are used to draw

useful conclusions in a business context

Quartiles are useful concept in statistics. Quartiles describe a division of observations into four

defined intervals based upon the values of the data and how they compare to the entire set of

observations. From table 1 and based on the question that relates to why people buy Starbucks

product, we thus calculate the lower, upper and the interquartile range.

Thus the lower quartile (Q1) is given as

Since n is 40, per calculations we get Q1 = 10.25th position. And this corresponds to product

quality. This therefore means that the first 25% of an ordered set of data tend to purchase

Starbucks product based on the quality of the product.

The upper quartile (Q3) is the median of the upper half of the data set. This is also calculated as

So per calculations, Q3 = 30.75th position. This corresponds to Price of the product. This therefore

means that the 75% of an ordered set of data tend to purchase Starbucks product based on the

price.

The interquartile range (IQR) is the spread of the middle 50% of the data values. It is

calculated as Q3-Q1 and this gives us

20.5th position which also means that the purchase of Starbucks product are as a result of Brand

Image.

The 25th Percentile is 1 and it means that people buy products of Starbucks do to its quality.

The 50th Percentile is 2 which shows that other people buy their products due to the brand image

The 75th Percentile is 2.75 which could be approximated to3 meaning that people purchase

Starbucks products due to the price.

Correlation describes the degree of relationship between two variables. Correlation is therefore

calculated as

So per calculations the correlation is -0.091 which means that there is a weak negative

relationship between respondent’s age and the type of Starbucks they use. Thus as people

increase in age they tend to purchase more of Starbucks coffee and a bit less of Starbucks food.

This is again shown in table

Table 4. What is your age? * What kind of Starbucks product do you use? Crosstabulation

What kind of Starbucks product do you use?

Total

Coffee Food Nutrition

What is your age?

up to 18 3 3 0 6

18-30 10 4 0 14

31-50 15 2 3 20Total 28 9 3 40

From the table, it could be realized that people between the age bracket of 31 and 50 tend to

purchase more of coffee whiles those between the ages of below 18 and up to 30 purchase more

of Starbucks food.

3.1 Produce graphs using spreadsheets and draw valid conclusions based on the information derived

From the figure, the horizontal axis show the income level and this has been denoted as 1, 2 and

3 to represent the income levels 10000-20000, 20001-30000 and 30001-40000 respectively. The

figure shows that those with income level between 10000 and 20000 tend to purchase Starbucks

product because of quality. Accordingly those within the income bracket of 20001 and 30000

tend to focus on brand image to make their buying decisions. And those within the 30001 and

40000 also tend to focus on quality of the product.

Figure 1. Level of Income and Reasons why people buy Starbucks product

Authors Construct, 2015

3.2 create trend lines in spreadsheet graphs to assist in forecasting for specified business information

Figure 2

Authors Construct, 2015

EXPLANATION OF THE TRENDS- Does Ones income level affect his buying behavior.

The trend in this figure is in relation to the price. It shows that as peoples income increases they tend to

focus less on price when buying Starbucks product. Thus in trying to forecast, Starbucks Ltd. should

however focus not so much on the price in areas where incomes levels of households are high. However

prices should also not be raised too much in order for competitors to take advantage.

3.3 Prepare a business presentation using suitable software and techniques to disseminate information effectively

3.4 produce a formal business report

Appendix

1. What is your age?

a] Up to 18 b] 18 - 30 c] 31- 50 d] 50 above e] other

2. What is your sex?

a] Male b] Female

3. What is your education level?

a] Primary education b] High school c] Undergraduate d] Postgraduate e] other

4. What is your occupation?

a] Student b] Teacher c] Nurse/Doctor d] Electrician e] Other (Please specify)

5. What is your annual income level?

a] Below 10000 b] 1000-20001 c] 20001-30001 d] 30001-40000 e] other (Please specify)

6. What kind of Starbucks category of product do you use?

a] Coffee b] Food c] Nutrition d] Other

7. Why do you buy Starbucks product?

a] Quality b] Brand image c] Good Customer Service d] Less Expensive

8. How did you get to know about Starbucks?

a] Family and Friends b] Internet (Please specify) c] Advertisement d] other

9. How do you judge Starbucks product?

a] Very good b] Good c] Normal d] Very Bad

10. Do you prefer products of other company’s apart from Starbucks even though Starbucks sells

the same product?

a] Yes b] No

11. If Yes why do you prefer products of other companies to Starbucks?

a] Price b] Quality c] Good Customer Service d] Closeness to Office e] Other (Please

Specify)

12. Again, if Yes which companies do you buy from?

a] McDonald’s b] Nestle c] Dunkin d] Other (Please specify)

13. What do you think about the price of Starbucks product you buy?

a] Very Expensive b] Expensive c] Reasonable d] Cheap

14. Will you introduce Starbucks product to any other person??

a] Sure b] Maybe c] Uncertain d] Never

15. What do you think Starbucks should do to get more customers

a] Reduce Price b] Employ more workers c]