Trigger 5

* Why and when should a startup company gather secondary versus primary data to validate the business case?

http://www.managementstudyguide.com/secondary_data.htm

Secondary data is the data that have been already collected by and readily available from other sources. Such data are cheaper and more quickly obtainable than the primary data and also may be available when primary data can not be obtained at all.

Advantages of Secondary data

It is economical. It saves efforts and expenses.

It is time saving.

It helps to make primary data collection more specific since with the help of secondary data, we are able to make out what are the gaps and deficiencies and what additional information needs to be collected.

It helps to improve the understanding of the problem.

It provides a basis for comparison for the data that is collected by the researcher.

Disadvantages of Secondary Data

Secondary data is something that seldom fits in the framework of the marketing research factors. Reasons for its non-fitting are:-

Unit of secondary data collection-Suppose you want information on disposable income, but the data is available on gross income. The information may not be same as we require.

Class Boundaries may be different when units are same. 

Before 5 Years	After 5 Years
2500-5000	5000-6000
5001-7500	6001-7000
7500-10000	7001-10000

Thus the data collected earlier is of no use to you.

Accuracy of secondary data is not known.

Data may be outdated.

Evaluation of Secondary Data

Because of the above mentioned disadvantages of secondary data, we will lead to evaluation of secondary data. Evaluation means the following four requirements must be satisfied:-

Availability- It has to be seen that the kind of data you want is available or not. If it is not available then you have to go for primary data.

Relevance- It should be meeting the requirements of the problem. For this we have two criterion:-

Units of measurement should be the same.

Concepts used must be same and currency of data should not be outdated.

Accuracy- In order to find how accurate the data is, the following points must be considered: -

Specification and methodology used;

Margin of error should be examined;

The dependability of the source must be seen.

Sufficiency- Adequate data should be available.

Robert W Joselyn has classified the above discussion into eight steps. These eight steps are sub classified into three categories. He has given a detailed procedure for evaluating secondary data.

Applicability of research objective.

Cost of acquisition.

Accuracy of data.

_________________

A common classification is based upon who collected the data.

Primary data: Data collected by the investigator himself/ herself for a specific purpose.

Examples: Data collected by a student for his/her thesis or research project.

(In movies) The hero is directly told by the heroine that he is her “ideal man”.

Secondary data: Data collected by someone else for some other purpose (but being utilized by the investigator for another purpose).

Examples: Census data being used to analyze the impact of education on career choice and earning.

(In movies) The hero reads a fictional account of the heroine’s “ideal man” (written for a course in English composition) that seems to describe him accurately. He seeks confirmation from his friends, concluding that he is her “ideal man”. (He never asks her directly, but assumes the “facts” are correct).

Some Advantages of using Primary data:

The investigator collects data specific to the problem under study.

There is no doubt about the quality of the data collected (for the investigator).

If required, it may be possible to obtain additional data during the study period.

Some Disadvantages of using Primary data (for reluctant/ uninterested investigators):

The investigator has to contend with all the hassles of data collection- 

deciding why, what, how, when to collect

getting the data collected (personally or through others)

getting funding and dealing with funding agencies

ethical considerations (consent, permissions, etc.)

2.   Ensuring the data collected is of a high standard-

all desired data is obtained accurately, and in the format it is required in

there is no fake/ cooked up data

unnecessary/ useless data has not been included

* What secondary data do you need for your business idea?

Pollution,

 demand of fish in Finland.

Sea food restaurants in Finland

Groceries

Wages and salaries

Agricultural variables and practices (rainfall, crops, soil types, and uses, irrigation, etc.),

Economic situation

* How to gather secondary data for your business idea? List the links to your relevant sources of secondary data.

Stats.fi