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C.

Demand
Kinect Game Hub is a new business that offers a unique kind of entertainment. Its
demand would be computed based on different factors. The population of target market
and its growth rate, gross market acceptability, acceptable target market, and annual
frequency are considered in projecting the demand for five years.
POPULATION OF EMPLOYEES
Given that Kinect Game Hub is within the Poblacion District, the population
within the range of 20-30 years old of the district for the past five years was determined.
Since, there is no available data for the employment rate per district; we used the rate for
the entire Davao City to solve for the Population of Employees.
YEAR

POPULATION
(20-30 Y.O)

EMPLOYMENT
RATE

POPULATION
(EMPLOYEES-20-30 Y.O)

AS % OF PRIOR
DEMAND

2007
2008
2009
2010
2011

30,133
31,097
32,092
33,119
34,179

95.1%
95.7%
93.8%
93.9%
93.9%

28,656
29,760
30,102
31,099
32,094

3.85%
1.15%
3.31%
3.20%

Table 1: Population of Employees for the past 5 years


TOTAL11.51%
AVERAGE GROWTH RATE 2.88%
The population of employees for the last five years is increasing. Even though the
employment rate is inconsistent, the population of employees is still increasing because of the
increasing population of people with ages 20-30 years old.

Table 2: Projected Population of Employees for the next 5 years


(Prior years demand plus 2.88% thereof)
YEAR

POPULATION
(Employees-20-30 y.o.)

2016
2017
2018
2019

36,990
38,055
39,151
40,278
41,438

2020

Given this projected population of Employees, Kinect Game Hubs demand will have a
potential increase in the future.
ACCEPTABLE TARGET MARKET
Table 3: Computation of Acceptable target market

YEAR

POPULATION
OF EMPLOYEES

GROSS MARKET
ACCEPTABILITY

ACCEPTABLE
TARGET
MARKET

2016
2017
2018
2019
2020

36,990
38,055
39,151
40,278
41,438

59%
59%
59%
59%
59%

24,413
25,116
25,840
26,584
27,349

The Acceptable Target Market can be computed by multiplying the population of


employees ( from table 2) to the gross market acceptability. The gross market acceptability can
be based on the proponents market survey on who are willing to avail of the service offered by
Kinect Game Hub in the future. Out of 195 respondents, 177 said yes thus arriving at 91%. Then

out of the 177 respondents who said yes, we narrowed down the percentage by counting the
respondents who said that they are willing to spend Php 240 per hour for a game room with a 4
person-capacity, thus getting the gross market acceptability of 115 respondents or 59%.
Table: Computation of Annual Frequency

RESPONDENTS
(a)
3
48
30
2
57
37
177

FREQUENCY
Everyday
Once a week
Twice a week
Thrice a week
Once a month
Twice a month
TOTAL

ANNUAL
EQUIVALENT
(b)
360 days
52 weeks
104 weeks
156 weeks
12 months
24 months

ANNUAL
FREQUENCY
in average per
person
(a*b)
1080
2496
3120
312
684
888
8580

Annual Frequency = ANNUAL FREQUENCY in average per person


Total number of Respondents (Willing to avail)
= 8580
177
=

48

The Annual Frequency can be based on the market survey done by the proponents. The
number of respondents for each kind of frequency is multiplied by the annual equivalent to get
the Annual Frequency in average per person. The annual equivalent is the corresponding number
of days, weeks, or months for a year depending on the kind of frequency. Then, the total Annual
Frequency in average person computed previously is divided to the total number of respondents
who are willing to avail of the service offered by Kinect game hub. The annual frequency for
Kinect game Hub is 48 times.

DEMAND FOR KINECT GAME HUB


Table: Demand for Kinect Game Hub

YEAR

ACCEPTABLE TARGET
MARKET

ANNUAL
FREQUENCY

ANNUAL
DEMAND

2016

21,824

48

1,047,552

2017

22,452

48

1,077,696

2018

23,099

48

1,108,752

2019

23,764

48

1,140,672

2020

24,449

48

1,173,552

In finding the Projected Annual Demand for five years, the proponents considered the
population of employees, gross market acceptability, acceptable target market and annual
frequency. But in the table above, only the acceptable target market and annual frequency are
shown for simplicity given that other factors not shown above were already computed in the
previous tables. The acceptable target from table 3 is multiplied to the annual frequency from
table 4 to get the annual demand for each year. As a result, Kinect game Hub will have the
annual demand for the year 2016 of 1,047,552 persons and so on.
The projected annual demand of Kinect Game Hub can still be affected by many factors.
One of such is the major expenditure items to which their income translate to. An example would
be expenses on food, transportation, house rent and utilities. Another is the

http://www.numbeo.com/cost-of-living/city_result.jsp?country=Philippines&city=Davao