_Term Two Assessed Assignment_ International Pre-Masters Programme 2009-2010 Business Management Assignment 3 New Product Development: Question 1: Estimated cost of finding one successful new product Question 2: Only 1 product in 4 passed the Concept testing stage. Then, this stage represents 8 products. Question 3: According to the chart below, the cost for the first stage of product development is 32 000 pounds. Also, the cost of the second stage of product development is 80 000 pounds. Then, the total cost is: 32 000 + 80 000= 112 000 pounds. Then, the total cost to the company of the first two stages of product development is 112 000 ponds. Question 4: According to the chart beside, the total cost is: 32 000 + 80 000 + 400 000+ 500 000+ 2,500 000 = 3 512 000 pounds Therefore, the total cost of developing the one successful product through the five stages is 3 512 000 pounds. Question 5: First, a New Product Development (NPD) is a process which is designed to develop, test and consider the viability of products which are new to the market with the aim to ensure the survival or growth of a company or organization. In other words, NPD is important for companies to keep up with changes in the market (maintain or increase market share by offering more choice) and because of new products are needed to replace products coming to the end of their cycle. Moreover, NPD could permit a company to create stars and cash cows, to maintain competitive advantages, and then to bring in new costumers. For example, to maintain its reputation as a leading edge company, Carrefour could create Sportswear products to diversify into a new market (appeal to a new segment) in order to fill gaps in this market. Finally, developing new products could improve relations with distributors, and make better use with the company’s resources. Question 6: a). Two industries where there is very substantial research and development of new