Business PPE UNIT 1 Revision

What is a Business?

= Organisation that's purpose is to produce Goods and Service that meets Customer Needs.

A business might buy goods from suppliers then sell it to Customers

Customers= Person/ Organisation that buys Product/ Service

Consumer= Someone who uses the product

What do businesses think when Setting Up?

1. Is there an Opportunity?

2. What Products should be Produced and Sold to Whom?

3. How will it be Financed?

Understanding Customer Needs:

= Growth+ Survival

Market Research can tell business:

1. What Features Customers want

2. Competition

3. How much Customers are Willing to Pay

4. Where Customers Shop

These can be answered by doing Primary and Secondary Research

Primary Research= Collecting New Data which has Not yet been Collected

1. Questionnaires

2. Focus Groups

3. Observations

Advantage:

1. Up to Date

2. Direct Customer Contact

3. Specific to Needs

Disadvantage:

1. Customers May Not be Cooperative

2. Time Consuming

Secondary Research:

= Collecting Existing Data

1. Local Newspaper

2. Government Stats

3. Market Reports

Advantage:

1. Less Time Consuming

2. Effective at Collecting Quantitative Data

Disadvantage:

1.

Qualitative Data= Opinions & Judgements

Quantitative Data= Statistics

Market Mapping:

- Helps business to:

1. Identify Gap in Market

2. Identify Posistion of their Product 

3. Identify Market Segment

Market Segments= Group of People with Similar Buying Habits

1. Age

2. Gender

3. Income

4. Lifestyle (Newlyweds)

Market Segmentation- Helps business to:

1. Meet Customer Needs

2. Differentiate Products

3. Focus on Specific Group of Customers

Competition:

Analyse Competition's Strengths + Weaknesses= Aid Business to Improve their Strengths + Weaknesses+ Not have Competitions Weakness to cause their Downfall

Ways to Compete:

1. Differentiate

2. Brand/ Reputation

3. High Quality

4. Wide Range

Sometimes Businesses might NOT Compete Head to Head BUT Help each other by: Business having Higher Quality than Competition + Competition having Better Customer Service than Busines= Both Businesses Attract Customers

Added Value:

= Increased Worth a Business Creates for a Product

Why is it Important?

1. Cover up Costs

2. Higher Chance of Growth + Survival

Ways to Add Value:

1. Differentiate Products (Design, Features etc.)= Customers Willing to Pay Higher

2. Better Quality= Customers Willing to Pay Higher

3. Improved Service Quality

4. USP

5*. Lower Costs

USP= Unique Selling Point

Franchising:

= Right Given to a Franchisee to Sell Franchisor's Products using their Name.

Advantage to Franchisee:

1. Established Reputation + Brand Name

2.Training++ Support Provided

3. Higher Chance of Surival

4. Access to Tried + Tested Goods

Disadvantage to Franchisee:

1. High Start Up Costs

2. Lack of Control

3. If another Franchise of Chain has Bad Reputation= Same to yours

4. Cannot Make Decision on your Own

Enterprise=

Enterpreneur= Individual who runs a business that shows Initiative, Willing to Undertake New Ventures & Risk Taking

 Enterprise Skills:

1. Show Initiative

2. Undertake New Ventures

3. Risk Taking

Importance of Risk:

Chance of Not Surviving so Entrepreneures Risk their Own Time, Livelihood + Money

Entrepreneure's Skills:

Please Don't Tie My Lace

1. Planning

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