What are the advantages of separate research department?
Generally, big companies required to organize a separate research department because this system has its own advantages and limitations. Let us consider the advantages of initiating separate research departments.
1. Marketing Strategy
After producing a commodity, company’s next target is generally marketing the commodity. Thus, a perfect marketing strategy is very much necessary and it depends on the information, analysis of marketing research organizations. A separate research 128 department of a company generally holds this responsibility and helps in planning a proper marketing strategy.
2. Changes in Market
Market changes occur due to changes in income, price, taste and preferences etc. Each commodity’s market varies differently with the above changes. The research department of a company understands the cause and effect and provides solution accordingly.
3. Timely Information
Most important advantage of a separate research department is, knowing the market in proper time. Whatever the market condition i.e. favorable or unfavorable are intimated in time hence, the loss is minimized.
4. Minimization of Risk
When a company introduces new product or in new market there will be uncertainty of demand for the product. This creates risk while selling the product. Hence the risk factor could be minimized with the help of detailed information of market which is provided by the concerned research organization of a company.
5. Innovative Approaches
Innovative approach is primary factor for the profitability of a company. Innovative approach means introduction of new product, new market, new production method, new raw materials etc. But it also includes risk and uncertainty of market. Thus, proper market research before implementing these innovative ideas helps the company to reduce the risk and uncertainty.
6. Profits
Profitability of company depends on various factors. One of the important factors is marketing. Both production and marketing of the commodity are equally essential to attain profits. Marketing research organization of a company targets this specifically and enhances the profitability of company.
7. Competition
Similar products are produced by many companies in the economy. There is a competition among these products. Except monopoly and perfect competition, companies have to face competition in the markets. The separate research organization gathers information and analyses it and provides right solutions.
8. Demand Variations
A separate research department of a company works with certain specified goals. One of the significant goals is to understand the consumer behavior. Consumer behavior varies with the 129 changes in income, price, substitute goods prices etc. The research department collets the necessary data, analyses it and follows the changes in consumer behavior. This awareness is required to the company in planning marketing strategy.
9. Market Information
One of the key factors in selling the product is information. Information about the product, market, price is essential for both producers and consumers. The research department provides information about the above said factors to the company. The company management can adopt proper marketing strategy with the help of information provided by the research department.