O'Donnell & Tuomey's Belfast Architecture Dissertation

O'Donnell & Tuomey's Belfast Architecture - Dissertation Example Table of Contents Acknowledgements†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦..2 Introduction...............................................................................................................3 Context†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦..†¦.†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦7 Lyric Theatre. A mass of Light and modernism †¦Ã¢â‚¬ ¦......................................8 Influences and Philosophy of O’Donnell and Tuomey. †¦................................16 Aims, goals and ideals of O’Donnell & Tuomey.................................................19 Conclusion.................................................................................................................24 References.............. ....................................................................................................26 Introduction Dublin based architects Sheila O'Donnell and John Tuomey , who have been practicing together since 1991, have a thoughtful outlook and attitude of how they ply their craft, that can be summarized as – continuity and renewal, which will be the subject of this paper. This dissertation as a critical analysis of the Lyric Theatre will examine O'Donnell + Tuomey's architectural journey. I will re-trace their influences, attitudes and examine values and ideals as apparent in their 2007 Lyric Theatre in Belfast. O’Donnell + Tuomey appreciate tradition, and that traditions ought to be brought into the 21st Century and translated in order to retain meaning in the present day. This is how they approach and interpret each design brief. The inspiration of Aldo Rossi to Irish architects, who acknowledged that â€Å"in Venice, where although one may be interested in w hether a building is by Palladio or Longhena, it is first and always the stones of Venice,†1 is also an inspiration to O'Donnell + Tuomey. They, too, believe that the materials of the land are the materials that should be used in their buildings, which is why, for instance, their Lyric Theatre, which is the subject of this dissertation, uses the bricks which are commonly found in buildings throughout Dublin. On returning from five years in London in 1982 – where Sheila O’Donnell completed a masters degree at The Royal College of Art, and both she and John Tuomey worked with James Stirling – Sheila O’Donnell and John Tuomey returned â€Å"in search of a subject,† married, bought a house and thought about how they might go â€Å"in search of the soul of Irish architecture†. Their role as studio teachers at UCD has involved not only educating a generation of Irish architects that are now gaining international recognition (Tom De Paor bein g the most prominent); they could also be said to have saved Irish architectural culture from the cults of technology and critical theory that afflict British architectural education. O’Donnell and Tuomey architects (O’D+T) can reasonably be considered to have cared for the soul of Irish architecture over the past few decades.2 It is impossible to think about the past two decades of Irish architecture without considering O’Donnell + Tuomey. Indeed without their involvement with Group ’91, alongside Grafton architects, Paul Keogh and others, there would be no Temple Bar or Lyric Theatre, and, he suggests, no internationally recognisable image of modern Ireland for young

People's management of stress Essay Example | Topics and Well Written Essays - 750 words

People's management of stress - Essay Example As it is, stress was reported not to be classified as an illness. However, when people are persistently and constantly challenged by mental or emotional pressures over a long term, the effects could actually lead to serious illnesses (NHS 2012). The article by Allen (2011) published in The Guardian reveales that from a survey conducted by the Chartered Institute of Personnel Development (CIPD), stress has been identified to be the commonest cause of long-term sick leave in organizations. In this regard, the aim of the current study is to present the results of a survey conducted at the Sheffield City Centre where 100 adult people, both male and female, were asked five (5) questions related to stress. The method used was a questionnaire-survey through interview. The results would hereby be presented and appropriate recommendations in the concluding portion would be suggested. The purpose of the questionnaire was to determine the major responses to concerns such as frequency of stress, causes, ways of managing stress through relaxation, taking time off work due to stress, and who to confide in when in stressful situations. They were asked five questions and their responses were tabulated and percentage results were revealed. The five questions asked are as follows: When asked how often do they feel stressed, the following pie chart shows that 45% of the respondents indicated occasionally (a few time a week), followed by sometimes (about half the time) at 20%. The least percentage was 5%, both answered by the 5 respondents as all the time and also 5 respondents as never. For those who responded that they are stressed, the major cause of stress was dominantly exhibited as relationships with family and friends at 25%, followed by money at 20%, fast pace of modern life and others, both at 10%, and only 5% indicated work. As such, the findings indicate that majority or 35 of the 100 people surveyed indicated that watching TV is their means of

Pricing Options using Binomial and Trinomial Methods

Pricing Options using Binomial and Trinomial Methods Published in the 1970s, the Black-Scholes-Merton model provided an entirely new definition for the financial option market, half a century later the Binomial tree option pricing model was published, and that is the true key that allows the option market to be generalized to the world. Based upon the Binomial model, the Trinomial option pricing model was built to reduce possible errors and persons thus expected it to be a better approach. Still how much better is the Trinomial model, and is it worth spending the time on calculations? These will be the key comparisons provided in this dissertation. The comparisons are based upon computer calculating time used, and approximation error. An illustrative example is used to build the data base for further comparison of the convergence speed of these two models. All the values are calculated using the Matlab program and Casio calculators in order to provide examples of the assumption that the Trinomial option pricing model is a better model in reducing the approximation error, but takes much longer than the Binomial tree model to get the results. Chapter 1 introduction The emergence of financial derivatives in the 1970s marked a highly significant and exciting event in the history of finance. Options trading began in the United States and European markets in the late eighteenth century, and over the last 20 years, options played a key role in all financial derivatives. The option price was an old question for the financial world. Back in the 1900s Louis Bachelier published his academic dissertation ThÃÆ' ©orie de la speculation (Theory of Speculation), which became known by the public as the milestone of modern finance. The random walk theory, which built a random model of the stock prices changing pattern and how it follows in the stock market, was first applied in his paper. In 1964, Paul Samuelson (Nobel Prize in Economic Science winner) revised L.Bacheliers model, and instead of the stock price he used stock returns to eliminate the negative figures which might occur in L.Bacheliers model. Based upon this new model P.Samuelson also studied the Call Option pricing problem, and built a pricing equation for it. Although the equation was quite a beauty to watch, it could not be used in real world dealings since two of the main factors depended upon the investors personal predilection. Futures and options are traded actively on many exchanges throughout the world. Before any certain systematization models of the option had been created it was impossible for people to evaluate any kind of option price in a common way. Any approximations of the price based traders personal experience would well likely result in mistakes. The only method to maximize the good of the option price would be to build a standard and systematization model and find the quantification of the option trading. This was an important event in the financial world at that time. Since the emergent of option trading, and especially of securities options trade, researchers have been busy in the studies of options pricing. In 1973, Fischer Black and Myron Scholes published The Pricing of Options and Corporate Liabilities at the University of Chicago, where they presented the famous Black-Scholes model for options pricing (B-S model for short). They derived a partial differential equation, which governs the price of the option over time. Once it has been published, the B-S model received strong responses and gained a breakthrough in this field. While some researchers conducted thorough tests on the models accuracy, many others presented various opinions on the problems in the model and expanded on them for the purposes of improvement and extension. Because of this glary partial differential equation and all of the contribution that it had created, M.Scholes and R.Merton (F.Black was deceased) both won the Nobel Prize for Economics. In 1979, Cox, Ross and Rubinstein published a paper called Option Pricing: A Simplified Approach, and in a simple manner obtained the pricing formula using the Binomial model, which was applied widely. This is the event that really changed the option trading market because it made option trading more transparent to most traders, and advanced the improvement of the market. During the option, the trading market developed more and more different sorts of option models, with the most famous and widely used models being the European option and American option. As these two options were named, they were mainly applied in Europe and America and the main difference between the two options is when the option will be fulfilled (I will fully explain this at a later stage). The Binomial option pricing model is essentially a Binomial Tree which shows possible values that an underlying asset or stock initial stock price can take, and the resulting value of the option price at each individual stage of the asset. The main idea of the tree is constructed by assuming that the stock can only go up or down by a factor related to the length of time period, and volatility of the stock. Trinomial model was developed by Prelim Boyle in 1986; it is an adjusted and improved version of the Binomial Tree. Instead of assuming the stock can only go up or down, the Trinomial Tree allows a third choiceà ¢Ã¢â€š ¬Ã¢â‚¬ the stock remains constant. Compared to the Binomial and Trinomial tree model, the Black-Scholes model is a more mathematical and theoretical model: V = SN (d1) N (d2) (Will be explained at later stage) Although the binomial option pricing model and trinomial tree values converge on the Black-Scholes formula value as the number of time steps increases. With these two simplified methods the option pricing theory and option market became more generalized and easier for the public. With the time flows, the option market began to prevail all over the world, and therefore more and more specific different types of options were created to adapt to the disparate country. In this dissertation I will mainly study and present the relation and difference between the Black-Scholes model, the Binomial Option Pricing model and the Trinomial Tree model, in both a mathematical and financial way. Chapter 1: This chapter is mainly about the Black-Scholes models differential equation, including every valuable deduction I provide a few interesting examples to give a straight forward view of this method. Chapter 2: In this chapter I will explore the Binomial pricing model with European and American options. By presenting the formulas and equations I will study how to calculate the option price and explain some basic financial terms. At the main time I will also compare the results of the Binomial Tree model to the Black-Scholes model. Chapter 3: In this chapter I will demonstrate the Trinomial model with examples and large amount of figures by using the Matlab software. The European and American options will be compared with the Trinomial model. Chapter 4: In the last chapter in my dissertation I will look at how effectively the Trinomial tree model is improved based on the Binomial model. The Matlab code I wrote will help me process this comparison up to a million steps. This will be my thesis of this dissertation and this project. 1.1 Risk Many of the valuation and risk management principles apply across all financial options. In this section, I will first briefly introduce some basic concepts and features of risk management and financial derivatives, especially the option pricing problems. RiskUncertainty of the result The risks obtained and a persons unexpected profit is the same as bringing loss or even damage to a person. In the financial market, risk is ubiquitous with: asset risk (stock), currency risk (exchange rate): credit risk, and so on. There are two ways of facing the risks. Risk Avoidance Risk-taking The process of selecting investments with higher risk in order to profit from an anticipated price movement, is called speculation. Financial derivatives are types of risk management instruments whose payoff depends upon the behaviour of the underlying assets. The most common derivatives are forward contracts, futures and options. Forward contract: A cash market transaction in which delivery of the commodity is deferred until after the contract has been made. Although the delivery is made in the future, the price is determined  on the initial trade date. The party agreeing to buy the underlying asset in the future is called a long position, and the party agreeing to sell the asset in the future is called a short position. The value of a forward position at maturity depends upon the relationship between the delivery price (K) and the underlying price (ST) at that time. For a long position this payoff is: fT = ST à ¢Ã‹â€  K For a short position, it is: fT = K à ¢Ã‹â€  ST Forward contract is normally traded over-the counter, OTC. Futures contracts are very similar to forward contracts, except they are not exchange-traded or the contract is standardized, and thus does not have the interim partial payments due to marking to market. Before studying the Binomial Tree method, I will look at what options are. 1.2Options An option is a derivative financial instrument that gives the buyer or holder the right, but not the obligation, to buy or sell an underlying financial asset or commodity. The buyer of the option gains the right, but not the obligation, to engage in some specific transaction on the asset. An option which conveys the right to buy something is called a call option, and an option which has the right to sell is called a put option. The reference price at which the underlying may be traded is called the exercise price or strike price. Most options have an expiration date. The process of activating an option is called exercise. If the option is not exercised by the expiration date, it becomes void and worthless. The options and related concepts can be classified into the following types: 1. Exchange-traded options Exchange-traded options (also called listed options) are a class of exchange-traded derivatives. Exchange traded options have standardized contracts, and are settled through a clearing house with fulfillment guaranteed by the credit of the exchange. Since the contracts are standardized, accurate pricing models are often available. Exchange-traded options include:[4][5] stock options, commodity options, bond options and other interest rate options stock market index options or, simply, index options and options on futures contracts callable bull/bear contract 2. Over-the-counter Over-the-counter options (OTC options, also called dealer options) are traded between two private parties, and are not listed on an exchange. The terms of an OTC option are unrestricted and may be individually tailored to meet any business need. In general, at least one of the counterparties to an OTC option is a well-capitalized institution. Option types commonly traded over the counter include: Interest rate options Currency cross rate options, and Option on swaps or swaptions. 3. Option styles Some options with complex financial structures are called exotic options, and these include: Barrier option any option with the general characteristic that the underlying securitys price must pass a certain level or barrier before it can be exercised. Double barrier option-A double barrier option involves a mechanism where if either of two limit prices is crossed by the underlying, the option either can be exercised or can no longer be exercised. Cumulative Parisian barrier option -A cumulative Parisian barrier option involves a mechanism where if the total amount of time the underlying asset value has spent above or below a limit price, the option can be exercised or can no longer be exercised. Standard Parisian barrier option-A standard Parisian barrier option involves a mechanism where if the maximum amount of time the underlying asset value has spent consecutively above or below a limit price, the option can be exercised or can no longer be exercised. Binary option-A binary option pays a fixed amount or nothing at all, depending on the price of the underlying instrument at maturity. An Asian option is an option where the payoff is not determined by the underlying price at maturity but by the average underlying price over some pre-set period of time. Bermudan option an option that may be exercised only on specified dates on or before expiration. For a cleaner view, I summarized various types of options in to a table below: standard of classification Types of options Option buyers right Call option and put option Excises time of option buyers. European option and American option intrinsic value In the money options, out of the money options and at the Money options Trading place Exchange-traded options and OTC options(Over-the-counter) Structures of options exotic options and vanilla options Margin of option. Unsecured and secured options There are two main reasons why investors would use options: to reduce risk and to gain more profit such as to speculate and to hedge. These will be discussed later. There are two main types of options, one is the European option the other is American option. The European option can only be exercised on the expiry date, while the American options may be exercised at any time before or on the expiry date. Assume k is the strike price; T is the expiry date, and the payoffs Vt: Vt = (St-K) + (call option) Vt= (K-St) + (put option) In this case, S is the spot price of the underlying asset. (t=T) Next, I will discuss the option pricing problems. Options are a type of bond derivative; its price depends upon the movement of underlying assets. The change of price of underlying assets is random because it is a kind of risk asset. Once the price of underlying assets is confirmed, then the option price can be confirmed too. This is saying that at the time the price of the underlying asset is St, the option price will be Vt and there exists function V(S, t) so that Vt= (St, t). At the expiry date, the value of option VT is the payoffs. VT = (ST-K) + (call option) VT= (K-ST) + (put option) The option pricing problem is to calculate V=V(S, t), (0, V(S, T) = Especially when t=0, and let the stock price is S0, what is the premium? p=V (S0, 0) =? Therefore, the option pricing problem is a working backward problem. 1.3 Types of investors. Now, I will look at three types of people in the stock market Hedger: An individual who enters into hedging trades. Hedging is a way of reducing risk. Hedgers want to avoid exposure to adverse movements in the price of an asset. For example: A Chinese company needs to pay a British supplier one million pounds after 90days.The company is facing the risk of fluctuation of exchange rate. If there is a big exchange-rate rise, this will affect its anticipated profit because of the extra cost. If the exchange rate is 12.5 Yuan / pound. The company considers two Hedging plans in view of the probability that the exchange rate may rise. Plan 1. Buy a forward contract stated to use 12625000 Yuan to purchase one million pounds after 90days. Plan 2. Buy a call option contract stated to use 12500000 Yuan to purchase one million pounds after 90days and pay a 250000 Yuan premium (as 2%). I now list the two hedging strategies in the table below: Spot exchange rate (Yuan/pound) 90dayslater exchange rate(Yuan/pound) Without hedging Forward contract Purchase call option contract 12.5 Increase to13 13million Yuan 12,625,000 Yuan 12,750,000 Yuan Decrease to12 12million Yuan 12,625,000 Yuan 12,250,000yuan According to the statistics provided, it can be seen that there will be extra costs when the exchange rate rises if the company does not use any hedging strategies. The costs are fixed after90days if they choose the forward contract but they may miss the chance that if the exchange rate goes down, they will gain from unforeseen profit .Meanwhile the company will prevent extra costs (rise in exchange rate) and gain profits (decrease in exchange) if they choose to purchase the call options contract, but they have to pay the premium. Speculator: An individual who is taking a position in the market. Usually the individual is betting that the price of an asset will go up or that the price of an asset will go down. Options like futures provide a form of leverage. For a given investment, the use of options magnifies the financial consequences. Good outcomes become very good, while bad outcomes may cause the whole initial investment being lost. For example, assume the stock price of X at 30th of April is à ¯Ã‚ ¿Ã‚ ¡666. The stock price may go up in August, and there are two investment strategies that investors may take. Investors spend à ¯Ã‚ ¿Ã‚ ¡666000 cash on 1000 shares of stocksà ¯Ã‚ ¼Ã¢â‚¬ º Investors purchase a call option contract which ends on 22nd of August: strike price is à ¯Ã‚ ¿Ã‚ ¡680, 1000shares, assume investors paid à ¯Ã‚ ¿Ã‚ ¡39000 premium for that. We now analyze the investors investment return in two different situations. (Ignore the interest rate) Case 1.If the stock price rises up to à ¯Ã‚ ¿Ã‚ ¡730 on 22nd August. For strategy A: The investor sells stocks on 22nd August to get à ¯Ã‚ ¿Ã‚ ¡730000 in cash. Return = (730000-666000)/666000=9.6% For strategy B: The investor exercises his option and gets profit: Profit=730000-680000=à ¯Ã‚ ¿Ã‚ ¡50000 Return = (50000-39000)/39000 Case 2.If the stock price drop to à ¯Ã‚ ¿Ã‚ ¡660 instead of rise on 22nd August. Strategy A: Loss =666000-660000=à ¯Ã‚ ¿Ã‚ ¡6000 Return= (660000-666000)/666000 Strategy B: The investors profit is=0 He will lose à ¯Ã‚ ¿Ã‚ ¡39000, and the percentage loss is 100%. Arbitrageur An individual engaging in arbitrage. Arbitrage A trading strategy that takes advantage of two or more securities being mispriced relative to each other. Arbitrage opportunities cannot last for long. As arbitrageurs interfere in the market, the forces of supply and demand will bring the market back to equilibrium. Therefore, in my project most of the arguments concern financial derivatives such as option prices, and, forward contracts will be based on the assumption that no arbitrage opportunities exist. 1.4 The Black Scholes Merton model There are seven important assumptions we use to derive the Black Scholes Model: It assumes that percentage changes in the stock price in a short period of time are normally distributed. It is defined as expected return on stock per year and as volatility of the stock price per year. This assumption suggests returns on the underlying stock are normally distributed, which is reasonable for most assets that offer options. It is possible to buy and sell any amount of stock, this includes short selling. There are no transactions costs , taxes or other fees. The stock pays no dividends during the options life. There are no arbitrage opportunities. Markets are efficient and Security trading is continuous. The risk free interest rate is constant and known.(

Red Badge of Courage :: essays research papers

Is it Sweet and Fitting to Die for One’s Country?   Ã‚  Ã‚  Ã‚  Ã‚  Stephen Crane’s The Red Badge of Courage is truly a unique book because it challenges the common perceptions of the Civil War. The fight for freedom and the American way of life were how writers such as Fredrick Douglass and Walt Whitman portrayed the Civil War. Crane challenges these principles by concentrating on the day-to-day reality the regiments of the North faced. Since the North’s main goal was to abolish slavery, they are remembered to be a group of men who were well equipped and prepared for battle because they represented the morality of the war. However, the North is shown through Crane to be a group of amateurs who are untested, lack discipline, and do not appreciate the opportunity to fight for their country and their way of life. In this sense, The Red Badge of Courage relates to life for how it is instead of how people want to remember it to be. Contrary to Crane, Cicero once wrote â€Å"Dulce et decorum est pro patria mori† (I t is sweet and fitting to die for one’s country). Stephen Crane’s The Red Badge of Courage begins as a validation of these sentiments of Cicero: although, the rationale of the sentiment is challenged throughout the story, Cicero outlook is ultimately shown to be true in the last battle scene.   Ã‚  Ã‚  Ã‚  Ã‚  In the beginning of The Red Badge of Courage, the main character, Henry, has preconceived ideals of war that lead him to believe that â€Å"it is sweet and fitting to die for one’s country.† â€Å"The young soldier† and â€Å"the youth† are nicknames for Henry and are used throughout the novel to convey the characteristics of his youth. Henry had a false sense of what war is really like because his lack of experience causes him to compares war to epic ancient battles. He idealistically thinks that his first battle will be â€Å"one of those great affairs of the earth (45).† Henry desperately wants to follow in the footsteps of Ancient Greek heroes and become a hero himself. He naively believes in the traditional forms of honor and courage. Dreams of the image of a dead soldier being laid upon his shield, following the Greek tradition of dying in battle, fill Henry’s head. He lacks experience in war so he can only imagine w hat it is truly like. The lack of experience makes Henry over zealous for battle and makes his belief in his inevitable greatness seem vain and self-centered.

Barack Obama’s “Inaugural Address”

President Barack Obama plays an important role not only for being elected as the first African-American head of state in the United States of America but also because he is greatly responsible in the fate of the Americans during this time. One of the most important speeches that a president could give to the citizens that he will govern is his or her inaugural address. This could be attributed from the reason that this speech is recognized as his or her first official way of communicating with the public. It is his or her way of informing them of the course of action of his or her administration.This kind of adage is greatly exemplified by the inaugural address of President Barack Obama wherein one of the most important and even controversial lines that he said are, â€Å"Less measurable but no less profound is a sapping of confidence across our land – a nagging fear that Americans decline is inevitable, and the next generation must lower its sights† (Obama, 2009). This abovementioned statement made by President Obama points out the fear that most Americans are experiencing because of the different problems that they are facing including issues on terrorism and the current economic crisis.These problems are threatening the security of the United States to the point that some critics are saying that this could cause the weakening of the country. As such, President Obama discussed in his inaugural address that these contemporary problems that the country are facing tend to leave some Americans with the fear that their country is not as powerful as compared before, which creates a sense of insecurity among the people. The future generations of America is also said to be capable of only dreaming less as compared to the grand goals of their forefathers because they need to lower their sights in order for it to be attainable.Nevertheless, President Obama assured the American people that the challenges that they are facing would be addressed. As such, he is assuring the people that in his administration, he would do something in order to address these issues and Americans would need not to worry of settling for anything less than what they need and what they deserve. Being the case, the fear of the country’s declining power and lowering their sights should not be the case anymore. The idea of the American dream is also greatly related with the statement made by President Obama.Some critics are asserting that achieving the American dream is quite impossible nowadays especially with the challenges that the country is facing. However, on my personal point of view, I still believe that the American dream is still attainable today, as the history of the country is a proof in itself that the United States of America could emerge stronger after this crisis. The critics of the United States have a declinist view about almost every problem that the country has to address.However, the Americans have proven that they could emerge victo rious even in the most difficult situations. This could be best exemplified by the end of the First World War wherein European countries are regarded as the dominant power in the world. Nevertheless, the United States started to take a bolder role in international affairs to the point of even participating in the Second World War. In line with these, it was also the United States that helped some of the most devastated countries after the war.Moreover, during the time of the Cold War, there are also some criticisms that this could be the downfall of America but the exact opposite took place. The United States was able to reign supreme in the Cold War which eventually paved the way for their global domination (Haas, 2009). â€Å"History repeats itself;† as this saying goes, I believe that in the case of America, this still holds true. The American dream is still attainable because the country could be able to surpass the challenges that they are facing right now.Electing Presi dent Barack Obama also shows how America is changing its traditional views in order to become open to changes. This is great evidence that they could surpass the problems that they have now. Sooner or later, the United States will once again prove that the American dream was, is, and will be attained. References Haas, L. J. (2009). Don’t Bet on America’s Decline. Retrieved August 3, 2009, from http://www. democratiya. com/review. asp? reviews_id=252. Obama, B. (2009). The Inaugural Address of President Barack Obama.

Nestle Distribution Channel

Table of Contents Sr. No. | Title| Page Number| 1| Introduction| 2| 2| Distribution Channels Structure| 2| 3| Terms of Appointment and Incentives for Distribution Channels| 3| 4| Reporting, Control and evaluation system for their sales force| 5| 7| Recommendations and Conclusion| 5| 8| References & Bibliography| 6| Introduction: Success toady in the competitive world has become very difficult. This is because it does not solely depend on basic factors but on all the factors related to the organisation.Earlier it was possible for an organisation to dominate in the market but today due to lot of different methods, channels and modern tools for marketing and functioning of the organisation, the world has become very competitive. In this assignment the author is concentrating on two major players in this competition, the distribution channels and the sales force. The company in discussion here is Nestle UK and the product for narrow research is Nestle’s own most successful bra nd â€Å"Kit Kat†.Nestle homes itself in Switzerland since 1867 today is one of the world’s most successful organisation in the FMCG category. www. total-logistics. eu. com, accessed 08 August 2010) It started its UK activities around 100years before and started their own manufacturing unit. Today Nestle has 8 manufacturing plants in UK with two head offices in Croydon and Dublin. (www. nestle. co. uk, accessed 08 August 2010) Distribution Channels Structure: According to Brassington and Pettitt, a channel structure is a route selected in order to move the product to the market through different intermediaries. This is the distribution channel structure which proves vital for the smooth movement of the product and making it available to the end consumer.Distribution Channel Structure forms the fourth element of the Marketing mix for any product. The ‘Place’ element, and therefore it becomes an important factor. There are various channels of distribution ad opted by various companies according to their product requirement and strategies. Apart from the above said vital function of a distribution channel, it has various other functions like: 1. Gathering market information which includes market research that helps future market planning. 2. Searching potential buyers and communicating them. 3. Doing promotional activities. 4. Achieving buyer specific demands and requirements. 5.Deciding on offers and pricing issues. 6. Storage and transportation of goods. 7. Managing funds required for functioning of the distribution channels. (www. tutor2u. net) Nestle adopted a strategy that their products should be made available in all the parts of UK and that they should not be falling behind for the supply, basically called as the ‘whenever’, ‘wherever’, ‘however’ strategy of distribution. In order to achieve this they needed a strong distribution network which supported their strategy and was cost effective. According to marketing department of Nestle UK they had analysed the following different channels of distribution.Single Tier Distribution Network: Producer – Retailer – Consumer Two Tier Distribution Network: Producer – Distributor – Retailer – Consumer Multi-Channel Distribution Network: Producer – Distributor – Regional Distributor – Wholesaler/Retailer – Consumer (www. nestle. com, accessed 08 August 2010) Owing to the huge retail market in UK the single tier distribution was almost impossible for Nestle to adopt as the distribution for Nestle directly would have become very complicated and the product strategy could not have been achieved.So they opted for multi-channel distribution network and appointed their own major distribution points at Bardon in Leicestershire and York in North Yorkshire. Bardon handles the food and beverage industry of Nestle in UK and York handles the confectionery industry of Nestle. The product in discussion here is Kit Kat which is distributed from York distribution centre. The physical distribution is done by trucks carrying composite palettes. The transportation is appointed by Nestle and is dedicated only for Nestle. York is a huge hub of confectionery and has heavy storage capacity to cater the market needs.Kit Kat being highly popular in the market there is continuous distribution running round the clock for Nestle. The demand in the market though fluctuating is handsome and so Nestle deals with it very efficiently. This generates high profit for Nestle as compared to other products. Nestle has their own regional distribution depots which are so placed that they cover the whole of UK. Kit Kat is transported from the national distribution centre at York to the regional depots as and when the requirement is put on. These regional depots then supply pallets of Kit Kat to the whole sellers in the market.In UK Asda, Tesco, Sainsbury’s, Waitrose, Morrisons, etc. are the major wholesalers those purchase huge stock from Nestle. (www. nestle. com, accessed 08 August 2010) All this is supplied from the regional depots. These whole sellers are direct retailers as well. So Kit Kat reaches the consumers from them as well as from small off license and small retailer shops. Terms of Appointment and Incentives for Distribution Channels: The distribution channels and its elements are all a part of the distribution strategy for any product.In order for the smooth functioning of the channel there are some terms and conditions between the company and the distributor. This is an agreement between the two over the products. The following are the mainly considered point in the appointment of any distributor as per UK law. 1. The Parties: are the guarantors needed for any obligations of the distributor 2. Territory/Products: The place and its boundary that the distributor is allotted for sale. The products the distributor is allowed to sale and many tim es the clause of new products that they get added automatically or new agreement has to be done each time. 3.Nature of Appointment: The company may reserve right to sell the product directly in the same territory or if needed can appoint a new distributor in the same territory. This point can be a complete no or flexible. 4. Duration of Appointment: The length of agreement or contract between the company and the distributor, as in fixed term or short term. If the contract is short term then the notice period has to specified, if it is a fixed term then the exact duration needs to be specified. There can be a linkage of the duration to the distributors performance say above a certain level then certain duration if not then discontinue.There also can be a probation period allotted for the distributor wherein the performance can be evaluated and then agreement can be decided. 5. Obligation of or restrictions on distributor: These are generally related to the sales, promotion and advert ising of the product. The rights can be kept by the company or can be given to the distributor. This point also refers to any requirements for sales in the territory say government licenses, quality certificates, pollution certificates, food and drug licenses, etc. The agreement also clearly states the cost bearer of all these permissions and licenses e. . the company or the distributor. This also covers for any taxes or duties that need to be paid for any particular territory, etc. 6. Intellectual Property: This point in the agreement covers for any patents, trademarks, particular registered designs, technical know-how, and other product related factors held by the company. This point covers for the permission needed if any by the distributor to use product factors for selling. Also the need of any license to use certain elements that the distributor needs to take before taking the distributorship.In some cases like if the trademarks are owned by the company the distributors are ap pointed as the registered users. 7. Termination: This covers the termination period and conditions in which termination can take place from both sides the company and the distributor. The notice period before the termination, if termination is due to some underperformance then any rectification time that is allotted to improve, etc. is a part of this clause. 8. Effect of Termination: In case of termination of the agreement the effect of it on the existing orders, stock already at the distributor, etc. elated information comes under this clause. If the distributor needs to sale the stock back to the company, what will be the cost at which he can sale? All these terms are covered under this point. 9. Notices: In some cases the headquarters are not in UK, so the jurisdiction of the territory may need a UK address for the notice. This is cleared under Notices point. 10. Arbitration: This applies only if needed. And if needed, the language and the place of arbitration are clearly mention ed in the agreement. 11. Relevant Law: This covers for any specific laws those required for the agreement.The jurisdiction of the territory is fixed. Many times the parent company is in other jurisdiction or vice versa, so the binding jurisdiction is decided and clearly mentioned in the agreement. 12. Notification: Some territories may require additional registration or notification in the local registering bodies; this is also mentioned in the agreement. (Weise, 2007) These are some standard and basic points covered in any appointment of distributorship. Nestle also follows the local law and has these sort of agreements are done with their distributors.Nestle incentives are very tempting for its distributors as nestle opts for win-win situation strategy. This helps them to keep the product moving always. Majorly two types of incentives are given to the distributors. Sales based commission in percentage of sales target achieved and holiday packages to exclusive tourist locations. (D emirag, 2010) The first one is major of the two as it depends on the performance of the distributor, the more the sales the more the commission. This is purely in the hands of the distributors so it is easy for them to achieve more incentives.These incentives affect major sales of any product. Reporting, Control and evaluation system for their sales force: Salesforce plays another vital role with distribution channels because it is a major element of the distribution network that works individually. Any organisation should have a proper channel of reporting, control and evaluation of the sales force. Salesforce management is of utmost importance as they face the customers directly and hence the reputation of any company is somewhat dependent on them.Success or failure is somewhat directly related to salesforce performance (Venugopal, 2006), therefore proper reporting, control and evaluation of the same needs to be very strong and clear in any organisation. (Muczyk and Myron, 1987, e t al cited Venugopal, 2006). Reporting of sales force is completely dependent on the hierarchy of the organisation and it differs from country to country and organisation to organisation. The reporting is from daily to weekly to monthly basis. Reporting is done by filling forms or computer generated sheets, emails and now a days through software.Reporting is usually to the regional managers in the sales department. (Marks, 2008) Software’s are becoming popular as the data can be available for the senior management to evaluate and check anytime they want. Salesforce performance needs to be evaluated through various methods in order to achieve maximum sales. Marks in his book explains’ about the evaluation techniques and methods of salesforce. Monthly audits and performance mapping of individual person in the sales team gives a clear idea of the performance of each individual. This helps the sales manager to design his team and decide the future actions and plans.Target setting also can be done with useful data from evaluation process. Based on this evaluation the salesforce needs to be compensated with rewards. This serves as motivation to work more efficiently. Regular training and meeting with senior and experienced staff helps improve selling methods and way of work. For Nestle the sales team has monthly orders from the big wholesalers like Tesco, Asda, Sainsbury’s, Waitrose, etc. Kit Kat being highly popular it comparatively easy for the sales team to achieve the set target due to high demand as a result of the popularity.They work on credit accounts that are opened initially after a small credit check and then the terms of credit period and payments are decided. Recommendations and Conclusions: Overview of Nestle UK concludes at a point that they have one of the best practices in the functioning of the product process in the market for Kit Kat. The only recommendation is that use of the railway network in UK in order to fast supply of the goods and reduction in time factor. This will improve their efficiency in the market and they can achieve the target sales smoothly without any shortages.In order to have a healthy business salesforce need to be motivated and kept happy. They are the major players in getting the business for any organisation. (Zoltners, Sinha, Lorimer, 2004) Any organisation selling product is complete only if they have a proper distribution structure and effective and efficient sales team. (Johnston and Marshall, 2010)