design mix Flashcards
what are the three elements of the design mix?
aesthetic
economic manufacture
function
what does it mean if a product is aesthetic?
a product that appeals to the 5 senses
what is meant by economic manufacture?
business creates a product at the lowest price possible to sell for a low price
what is meant by function in the design mix?
a good quality product that is designed to work/ perform well
give an example of an aesthetic product
- michelin restaurants
- designer handbags
give an example of an product that focuses on economic manufacture
- own brand food
give an example of a product that focuses on function
- washing machine
LOA- benefit of focusing on aesthetic/ function
- business focuses on improving the aesthetic/ function of the design mix
- through r&d to improve functionality or market research to identify customer trends
- business can be more differentiating compared to rivals
-gain a competitive advantage - increase selling price without significant fall in demand
- increase sales revenue
- and gross profit margins
LOA- drawback of focusing on aesthetic/ function in the design mix
- to improve aesthetic/ function will require a high investment into r&d and market research
- increasing cash outflows
- if outflows are greater than inflows
- business will have a negative net cash flow
- placing a strain on cash reserves
- may struggle to pay suppliers
- may have to sell NCA
- disruption to business operations
LOA- benefit of focusing on economic manufacture
- business focuses on economic manufacture in the design mix
- for example by using less robust raw materials ( link to extract )
- reducing their cost of sales
- can pursue cost leadership according to porter
- gain a competitive advantage
- decrease selling price
- increase in demand
- increase in sales
LOA- drawback of focusing on economic manufacture
- business designs product with economic manufacture as a priority
- e.g through using less robust raw materials
- it may mean that the product they design becomes less robust
- damaging the business reputation
- consumers may switch to alternatives
- decrease demand
- decrease sales
- less profit to retain and reinvest
LOA- benefit of changing the elements of the design mix to reflect social trends
(must adapt to relevant social trend from extract)
- changing design mix go reflect social trends ( choose social trend and element of the design mix relevant to the business in question)
- product now aligned with social trends
- better meets customer wants and needs
- consumers more loyal to business
- can inc selling price without sig fall in demand
- increase sales revenue and gross profit margin
LOA- drawback of changing the elements of the design mix to reflect social trends
- to identify relevant social trends
- requires significant investment into market research
- to ensure data is valid must be collected from a large sample
- business needs to recruit specialist researchers to collect and analyse data
- increasing cash outflows
- placing strain on cash reserves
- less cash to pay for day to day operating
what is resource depletion?
using resources quicker than they are being replenished
LOA- benefit of adapting design mix to minimise resource depletion
- business may (adapt to business in extract) e.g stop using rare wood when making product
- swap to more sustainable wood
- changing aesthetic of product due to concern over resource depletion
- aligning with consumers values
- better meeting customers needs
- product more differentiated
- can increase selling price without sig fall in demand
- increase revenue
LOA- drawback of adapting design mix to minimise resource depletion
- adapting design due to concern over resource depletion (be specific to business in question)
- meaning the business needs to find alternative supplier for raw materials
- charge higher price for new materials
- increasing cost of sales
- reducing gross profit margins
- reducing operating profit margin
- less profit to reinvest
